Sephora claims it respects consumer privacy and “strives to be
transparent about how their personal information is used” to improve
customer experience.
The world’s leading cosmetics and beauty products manufacturer
Sephora will pay a fine of $1.2 million to settle claims with a
California district court.
The fine was brought under the California Consumer Privacy Act (CCPA)
2018 after more than a hundred retailers were examined for compliance
with the act. The law was implemented primarily to ensure consumers can
control the kind of data businesses can collect.
The Accusation
The company allegedly breached the California Consumer Privacy Act by
ignoring to inform its customers that it sold their data. The company
also failed to honor consumer requests to avoid selling their data by
using the opting-out feature on its website.
Furthermore, Sephora ignored customers’ requests who signed through a
Global Privacy Control supporting browser/extension and didn’t want to
sell their private data. Instead, it allowed third-party firms,
including marketing, advertising, and data analytics companies, to
access its customers’ online activities in exchange for their services.
To do so, third parties created profiles of customers and accessed
personal data like their shopping cart items, device details, and
location, court documents revealed. The court was further informed of the following:
“Consumers are constantly tracked when they go online. Sephora, like
many online retailers, installs third-party companies’ tracking software
on its website and in its app so that these third parties can monitor
consumers as they shop. Third parties track all types of data; in
Sephora’s case, third parties can track whether a consumer is using a
MacBook or a Dell, the brand of eyeliner that a consumer puts in their
“shopping cart,” and even the precise location of the consumer.”
“Some of these third-party companies create entire profiles of users who
visit Sephora’s website, which the third parties then use for Sephora’s
benefit. For example, the third party might provide detailed analytics
information about Sephora’s customers and provide that to Sephora, or
offer Sephora the opportunity to purchase online ads targeting specific
consumers, such as those who left eyeliner in their shopping cart after
leaving Sephora’s website. This data about consumers is frequently kept
by companies and used for the benefit of other businesses, without the
knowledge or consent of the consumer.”
Sephora’s Response
However, Sephora claims it respects consumer privacy and “strives to
be transparent about how their personal information is used” to improve
customer experience.
“Sephora was not the target or victim of a data breach, and this
agreement with the California Office of the Attorney General (“OAG”)
does not constitute an admission of liability or fault by Sephora. We
have always cooperated fully with the OAG and Sephora’s practices are
already in compliance with the CCPA.”
Furthermore, Sephora explained that it uses data “strictly for
Sephora experiences” and that the CCPA doesn’t define SALE in its
conventional sense. That’s because traditionally, Sale entails
industry-wide implemented standard practices like cookies that allow the
company to provide its customers “more relevant Sephora product
recommendations,” customized shopping experiences, and advertisements.
Consumers can simply opt-out of this by “CA- Do Not Sell My Personal
Information. The link is available on the Sephora website footer, the
company said.
According to Segev, “Business leaders are tasked with finding ways to
leverage data to create new revenue streams. Especially with the shift
to remote work, permissive access and applications like Google Drive or
Slack make it easy to access and spread information across a business.”
“The people or teams involved may have believed they were permitted
to monetize this data. How many businesses are prepared for this kind of
action? Security and risk teams need a simple way to answer basic
questions like What data do I have? Where is it now? Who is accessing
it? How should it be governed and secured? Those are questions you need
answers to at your fingertips, not something to be found after a lengthy
audit process following a security incident,” Segev emphasized.
CCPA Details
The law entails that Californian consumers are entitled to know what
information a business can collect, how they can use it, and the option
to delete the data a company collected from them.
For your information, the act applies to for-profit retailers doing
business in California earning gross annual revenue of more than $25 million
and also to companies that buy, sell, or receive the personal data of
50,000+ devices, residents, and households in California and derive over
50% of their annual revenues from selling the residents’ private data.
The settlement resulted from a year-long Enforcement Sweep channeled
by California Attorney General Rob Bonta. He investigated Sephora and
many other businesses to check if any of them breached the CCPA.