Better Business Bureau gives nod to Lowe's - Brief Article

Home Channel News, May 1, 2001 by Jason Gonzalez

DIY retailer may be first in industry to be honored for its online privacy policies

WILKESBORO, N.C. -- Lowe's has received official recognition for its online privacy policies from the Better Business Bureau's Internet division and in doing so may have become the first home-improvement retailer to be awarded the BBBOnLine Privacy Seal.

BBBOnLine grants its Privacy Seal to companies it believes have made a concerted effort to protect customer privacy online. To be eligible for the seal, Lowe's had to apply to participate in the program -- a process that involves payment of a substantial fee -- and agree to allow BBBOnLine to conduct an extensive review of its policies for handling its customers' personal information.

"Businesses that qualify for the BBBOnLine Privacy Seal are demonstrating to their customers care and respect for the treatment of personal data," said Ken Hunter, president and CEO of the Council of Better Business Bureaus, the umbrella organization that oversees the country's 129 BBB units as well as BBBOnLine.

While Lowe's was the only DIY-oriented retailer of the 700 firms listed in BBBOnLine's database of Privacy Seal recipients as of mid-April, the agency said that several hundred additional companies are in the process of applying for a Privacy Seal; it was not possible to determine if any of those were home improvement retailers.

There are more than a half-dozen home centers, hardware stores and lumberyards that participate in BBBOnLine's other certification endeavor -- the Reliability Seal Program -- which grants a Reliability Seal to companies that meet three criteria: they are regular bureau members, they have been in business for a minimum of one year and they have been judged to be truthful advertisers. Among the companies to receive Reliability Seals are Home Depot, Do it Best Corp., Houston-based Bering's Home Centers and Pella, Iowa-based Kooyman Lumber

Criteria for Privacy Seal award recognition are more demanding. Companies applying for the Seal must open their sites to full review by BBBOnLine compliance officers. To be found in compliance, a company must post a privacy policy that is, according to BBBOnLine, "easy-to-find, easy-to-read and easy-to-understand." The posted policy must also include product information, data access, site security and third-party transfer information -- perhaps the primary concern among consumers and privacy advocates.

Another significant component of the application process is the ability to pay several thousand dollars to BBBOnLine. Costs consist of a $75 processing fee and an annual evaluation fee that ranges from $200 to $6,000. For a company comparable to Lowe's size -- revenues of $18.8 billion last year -- the annual fee is $6,000.

Lowe's said it applied for the seal because it believed its online customers want to know the retailer is committed to privacy.

"We view the seal as a way to assure our customers and site visitors that we care about their privacy and [that] we will treat their personal information in a responsible way," explained Meg Armstrong, director of business development and marketing for Lowe's Internet business group. The retailer plans to promote its BBBOnLine recognition by displaying the seal on its Web site, posting an online notice and possibly including the seal in certain mailings.

Armstrong said that the entire process -- application, review, Web modifications suggested by BBBOnLine and seal receipt -- took less than a month. As part of the program, however, the retailer must keep its privacy policies up to date with evolving Internet protocol.

It also must agree to participate in the program's dispute-resolution system, which seeks to provide a "customer-friendly" dispute settlement process. Non-compliance with this component of the program could lead to consequences ranging from seal withdrawal to referral of customer complaints to government enforcement agencies.