As a business, every day, people share data with you. When they visit and explore your site, they leave digital footprints that can be traced back to them with you. When computed and analysed, this data can provide specific information about the client.
With each degree of data, customers have to share, they get extra careful and can begin to ask questions about how their data is used. This is due to the amount of exposure it can give them.
For instance, if you require just the first name of customers, they might not worry, but when you ask for their full name, date and place of birth, account details, and next of kin, they want to understand why you need that data and what will happen to it. Of course, no one wants such info about them flying around. It could compromise their account and physical security. Even when there is no threat, some people are private and don't want such details about them flying around.
But I Don't Need Personal Info
While you may not need customer data for your service delivery, their contact information is something you must have for marketing and follow-up purposes. Some sites require visitors to give their contact info even if they don't sign up or make a purchase. Why? To follow up with them. Customer acquisition to loyalty is a process greatly enhanced by customers' contact database.