Do customers really value privacy—or will they trade it for a coupon code? In this episode of Marginally Better, Joe Taylor, Jr. unpacks the “privacy paradox” where 86% of people claim to care about data protection, but most will hand over personal details for even the smallest convenience. We’ll explore why privacy is becoming a luxury good, how small businesses are winning with trust-first strategies, and the economic realities behind “free” services. Plus, practical tactics for delivering user research that challenges leadership’s pet projects—without killing your career. It’s an eye-opening conversation about trust, transparency, and telling the truth in business.
Episode Links:
- Design in a World of Change: Why UX is Not Enough Anymore
- Designing AI User Interfaces That Foster Trust and Transparency
- Your Customer Experience Isn’t Broken – It’s Just Unclear
- Your Online Privacy Is Not a Luxury, It’s a Commodity
- Meta’s Overpriced Ad-Free Subscriptions Make Privacy a Luxury Good
- Online Privacy Is a Right, Not a Luxury
- Why Privacy Is the Real Luxury in Our Modern Era
- Why Stakeholders Don’t Vibe with User Research
- It’s Incredible How Many Bad User Experiences Are Still Out There in 2025
- How Design Leaders Win Over Organizations That Don’t Trust UX
Transcript:
Announcer: From the global headquarters of Johns and Taylor in beautiful New Jersey, it’s Marginally Better. Here’s your host, Joe Taylor, Jr.
Joe Taylor, Jr.: On the show this week, here’s a riddle for you: What do customers say they want more than anything but will happily trade for a 10% discount coupon? If you guessed privacy, you’re paying attention.
We’ll explore how companies are navigating the bizarre reality where 86% of consumers say they care about data privacy, yet 74% will hand over personal information for the smallest convenience. We’ll dive into whether privacy has become a luxury good only the wealthy can afford, and reveal how some businesses are turning privacy protection into their biggest competitive advantage.
Plus, what happens when your user research proves your CEO’s pet project is a disaster? We’ve got strategies for delivering bad news without losing your job.
That’s all coming up after the break on Marginally Better.
Welcome to Marginally Better, a show about business, innovation, and the American economy. I’m Joe Taylor Jr.
If you’re a designer right now, you might be feeling a bit like a tightrope walker during an earthquake. The ground keeps shifting, the tools keep changing, and somehow you’re supposed to maintain perfect balance while everyone watches.
A designer writing in Design Bootcamp – and we’ll have the link in our show notes – recently captured what thousands of UX professionals are feeling. They wrote about sitting in yet another meeting where executives demanded they design for “trust” and “transparency” while simultaneously asking them to implement dark patterns to boost conversion rates.
“Design in a world of change,” they argue, “means UX is not enough anymore.” The traditional toolkit – wireframes, user flows, usability testing – that’s table stakes now. Today’s designers need to be ethicists, psychologists, and fortune tellers all rolled into one.
They share a haunting example: A fintech app they worked on that promised “complete transparency” in its marketing, then buried fees in micro-text and used confusing language to obscure interest rates. The designer pushed back, was told it was “industry standard,” and watched as customer trust scores plummeted within six months of launch.
The kicker? The company then hired consultants to figure out why customers didn’t trust them.
Over at UXmatters, researchers are documenting something fascinating about AI interfaces. Users desperately want to trust AI tools – they want the convenience, the efficiency, the magic. But they also want to understand what’s happening with their data.
The research, published this April, found that users need three things to trust an AI interface: They need to know what data is being collected, how decisions are being made, and most critically, they need an escape hatch – a way to opt out that actually works.
One designer they interviewed had worked on a healthcare AI that could predict patient readmission rates with 85% accuracy. Impressive, right? But when they made the AI’s decision process transparent – showing exactly which factors influenced each prediction – something unexpected happened. Doctors trusted it less.
Turns out, sometimes transparency reveals that the sausage-making process isn’t very appetizing. The AI was weighing zip codes heavily in its predictions, essentially encoding socioeconomic bias into medical decisions. Full transparency exposed an uncomfortable truth.
Mark Bridges, writing on Medium, puts it bluntly: “Your customer experience isn’t broken – it’s just unclear.” He argues that most businesses are trying to solve the wrong problem.
He tells the story of an e-commerce site that spent $2 million on a redesign because conversion rates were dropping. New colors, new layout, new everything. Conversion rates dropped further.
Then they did something radical: They rewrote their product descriptions to actually explain what they were selling. No design changes, just clarity. Conversions jumped 34%.
“We’ve become so obsessed with reducing friction,” Bridges writes, “that we’ve forgotten users need to understand what they’re agreeing to. A smooth path to confusion isn’t good UX.”
What’s emerging from all this chaos is a new understanding: Trust isn’t something you design. It’s something you earn through thousands of small, honest interactions.
The companies succeeding aren’t the ones with the slickest interfaces or the most sophisticated AI. They’re the ones brave enough to be boring – to say exactly what they do, exactly what they collect, and exactly what happens next.
Because here’s the truth: In a world where everything is changing at light speed, the most radical thing you can do is be consistently, boringly trustworthy. No surprises. No gotchas. Just clarity.
And that might be the hardest design challenge of all.
Sarah Chen thought she was being smart. The 34-year-old marketing manager from Phoenix had read all the articles about data privacy. She used a VPN. She’d deleted Facebook. She even paid for ProtonMail instead of using Gmail.
Then her daughter’s school sent home a permission slip for a “free” educational app that would help with math homework. It promised personalized learning, progress tracking, and adaptive lessons. All free. Forever free.
Sarah hesitated. She read the privacy policy – all 47 pages of it. The app would collect her daughter’s name, birthdate, school performance data, location, device information, and something vaguely described as “interaction patterns for improvement purposes.”
She thought about saying no. Then she thought about her daughter falling behind in math. About the other parents who’d probably all say yes. About how it was just math homework, after all.
She signed the permission slip.
Sarah’s dilemma, reported by ABC15 in Phoenix and echoed in investigations across the country, represents a new form of economic inequality: privacy as a luxury good.
“Your online privacy is not a luxury, it’s a commodity,” ABC15’s investigation found. But that commodity has a price most people can’t afford.
Consider the Meta lawsuit in Europe, covered by Ars Technica. When European privacy laws forced Meta to offer an ad-free version of Facebook and Instagram, they priced it at €9.99 per month. For a family of four, that’s nearly €500 per year just to keep one company from harvesting your data.
The European Consumer Organisation called it what it was: making privacy a luxury good. As their lawsuit stated, Meta was “forcing consumers to choose between paying a fee for privacy or giving away their personal data.”
But let’s put real numbers on what “free” actually costs. According to research cited by PC Magazine, the average American has 12 paid subscriptions. To get privacy-respecting alternatives to all the “free” services we use? You’re looking at: Email: $5-10/month, Cloud storage: $10-20/month, Social media: $10-15/month per platform, Search: $5-10/month, Maps and navigation: $5-10/month, Video platforms: $15-20/month, News and information: $20-40/month.
Add it up, and privacy costs a middle-class family $1,200 to $2,000 per year. That’s a car payment. That’s two months of groceries.
As one privacy advocate told PC Magazine, “When privacy becomes something only the wealthy can afford, surveillance becomes a tax on poverty.”
Here’s where it gets interesting. Companies are discovering that the privacy paradox isn’t really a paradox at all. Customers aren’t confused – they’re making rational economic decisions with imperfect information.
A Medium piece by Bottomline Conversations explored this through the lens of luxury brands. When Apple made privacy a core selling point – “What happens on your iPhone stays on your iPhone” – they weren’t just selling privacy. They were selling status.
The iPhone became what economists call a Veblen good – something that becomes more desirable as it becomes more expensive. Privacy wasn’t just a feature; it was a signal that you could afford to pay for your technology rather than be the product.
One venture capitalist quoted in the piece put it starkly: “In Silicon Valley, using Gmail is starting to look like shopping at Walmart. It’s not that it doesn’t work – it’s what it says about your economic status.”
But here’s the plot twist: Small businesses are finding opportunity in this privacy divide.
Take Fathom Analytics, a tiny company competing with Google Analytics. They charge $14 per month minimum. Google Analytics is free and processes data from 85% of all websites.
You’d think Fathom would be dead on arrival. Instead, they’re growing 40% year over year. Why? Because they can promise something Google structurally can’t: “We’ll never sell your visitors’ data because we don’t even collect it.”
For privacy-conscious businesses – law firms, healthcare providers, financial advisors – that promise is worth far more than $14 a month. It’s worth their reputation.
But perhaps the most troubling aspect of the privacy paradox shows up in generational data. Younger consumers, those who grew up with “free” services, have essentially given up.
One 22-year-old college student quoted in the ABC15 investigation summed up her generation’s resignation: “I assume everything I do online is being watched. The question isn’t whether they’re collecting my data – it’s whether I get anything in return.”
This learned helplessness creates what researchers call a “privacy spiral.” The less people value their privacy, the less companies need to respect it. The less companies respect it, the more normalized surveillance becomes.
So how do businesses thread this needle? How do you respect privacy while staying competitive with “free” alternatives?
The answer might be counterintuitive: Stop trying to compete on price.
A small email marketing company called ConvertKit faced this exact challenge. MailChimp offers a free tier. ConvertKit starts at $15/month. Instead of racing to the bottom, ConvertKit made a radical decision: They would be expensive and proud of it.
Their pitch? “We’re expensive because we don’t sell your data. We’re expensive because when you call, a human answers. We’re expensive because your subscribers’ information stays yours.”
Revenue last year? $38 million. Not bad for a company that refuses to offer a free plan in a market dominated by free alternatives.
Back to Sarah Chen and that math app. Six months later, she got a notification. The app’s parent company had been acquired. The new terms of service? Her daughter’s learning data could now be used to “improve educational products across our portfolio.”
Sarah did the math. The “free” app had collected six months of her daughter’s educational data – her strengths, weaknesses, learning pace, attention patterns. What was that worth? What could it become worth in five years? Ten years? When her daughter applied to college? When she looked for her first job?
The free app, Sarah realized, might end up being the most expensive thing she ever signed up for.
The privacy paradox isn’t that customers don’t understand the trade-off. It’s that the true cost only becomes clear when it’s too late to get your data back.
Picture this scene: You’re a UX researcher. You’ve just spent three months and $50,000 on comprehensive user testing. The results are in, and they’re crystal clear. The CEO’s revolutionary new feature – the one they’ve been talking about at every all-hands meeting, the one named after their dog – tested about as well as a screen door on a submarine.
Now you have to present these findings. Tomorrow. To the CEO. Who named the feature after their dog.
Welcome to what one researcher calls “the killing fields of user experience.”
Writing in UX Planet, a researcher who goes by the handle “Surviving UX” shares a story that’s become legend in design circles. They’d been hired to test a new authentication system that a senior leader had personally designed. It required users to draw a shape, then tap a pattern, then enter a code.
“It’s unhackable,” the CPO proclaimed. “Three-factor authentication!”
It was also unusable. Test users couldn’t remember the shape they’d drawn five minutes earlier. The pattern grid was too small for anyone over 40 to tap accurately. And the code? It expired so quickly that slow typists couldn’t enter it in time.
The success rate was 23%. For logging in. To check your account balance.
But here’s where it gets interesting. Instead of presenting this as failure, the researcher reframed it as discovery. They didn’t say, “Your baby is ugly.” They said, “We’ve discovered something fascinating about user memory under stress.”
They presented the data as a journey: “Users loved the security concept – 89% said they wanted better protection. But we found an opportunity to achieve the same security with 75% less cognitive load.”
The leader’s response? “Show me how.”
Another piece on Medium asks a question that haunts every designer: “How are there still so many bad user experiences in 2025?”
The author’s answer is brutal: Because the people making decisions aren’t the ones feeling the pain.
They share the story of a banking app where board members each had dedicated relationship managers who handled their transactions. The board literally never used the app they were approving. When forced to try it during a workshop, one board member couldn’t figure out how to check his balance. His response? “Well, I’d just call Jerome.”
Jerome was his relationship manager. The other 5 million customers didn’t have a Jerome.
Perhaps the most insightful piece comes from UX Design, exploring how design leaders win over organizations that don’t trust UX. The author, who successfully transformed design culture at three Fortune 500 companies, shares their playbook.
First, they never use the phrase “user experience.” Why? Because it implies the current experience is bad. Instead, they talk about “customer success metrics” or “conversion optimization.” Same work, different framing.
Second, they start with the money. Not “users are frustrated.” But “we’re losing $1.2 million per month to cart abandonment, and I can show you exactly where.”
Third, and this is crucial: They make allies before they make arguments. They found the one executive who’d been burned by bad UX at a previous company. That person became their champion, translating user research into boardroom language.
But my favorite example comes from a designer who calls themselves “The Stakeholder Whisperer.” They were hired to redesign an internal tool at a large insurance company. The tool was universally hated. Productivity studies showed it added 3 hours to every claim process.
The problem? The SVP of Operations had personally overseen its development five years earlier. It was his “legacy system.”
Instead of attacking the system, the researcher positioned themselves as its historian. They interviewed the SVP about his original vision. What problems was he trying to solve? What constraints did he face?
Then they presented their research as “Realizing the Original Vision: How Technology Advances Now Make Your Ideas Possible.”
Every criticism was reframed as technological evolution. “In 2019, you couldn’t do real-time validation. Now we can.” “The infrastructure you needed didn’t exist. Now it does.”
The SVP became the biggest champion for the redesign. At the launch, he gave a speech about how “good ideas sometimes need to wait for technology to catch up.”
Here’s what all these stories have in common: They recognize that being right isn’t enough. You need to be right in a way that lets others be right too.
As one design leader puts it: “Your job isn’t to prove stakeholders wrong. It’s to help them be right in a better way.”
Because in the end, user research isn’t about winning arguments. It’s about building bridges between what stakeholders want to be true and what users need to be true. And sometimes, just sometimes, you find they want the same thing.
They just need help seeing it.
Joe Taylor Jr.: That’s our show for today. Whether you’re protecting privacy, designing for trust, or delivering difficult truths, remember: The best customer experience isn’t about having all the answers. It’s about asking the right questions and being honest about what you find.
Thanks for listening to Marginally Better. If you like what you heard, please help us out. Leave a quick review on Apple podcasts. It will help us spread the word about the show to people like you who care deeply about great customer experiences.
If you want to get behind the scenes notes from me and the rest of the team, go to marginallybettershow.com or follow the link in our show notes.
Marginally Better is a Calufrax radio production. Our producer is Nicole Hubbard with research by Connie Evans.
I’m Joe Taylor, Jr.
Joe Taylor Jr.
After a decade in broadcast media, Joe developed early online platforms for NPR, PBS, and AOL. Today, he helps our clients tell compelling brand stories through audio, visuals, and software.