The long awaited General Data Protection Regulation (GDPR), passed by the European Parliament, has been in effect for a few months now and it presents a pivotal moment in our modern-day era of digital transformation and data privacy.
Establishments are facing the test of the most radical overhaul of data regulation measures in a generation. Data protection laws haven’t been updated since the 90’s. Since then, we’ve seen the evolution of data collection into a science. Data collected is used across industries to better understand past user behaviour thereby enabling businesses to predict future trends with a greater level of accuracy.
We have a digital focused economy today that was inconceivable in the 90’s. Technological advances over the years along with a convergence of legislations in our global economy requires new reforms to take into consideration the proliferation of big data, technological developments and evolving consumer expectations. Consumer trust is ever more crucial to the private as well as the public sector. Enter GDPR, which puts the power back into the hands of the consumers, giving them greater control of their personal data.
The new directive is a monumental step in the realm of data regulation as it has implications for businesses across the EU and beyond. All organisations processing personal data about customers resident in the EU will need to abide by the law. While it is vital for businesses to comply with the changes to the data protection infrastructure, the key question facing marketers is whether they can continue to thrive in this new landscape.
For us marketing and ad tech professionals, it boils down to knowing our audience well and being agile enough to tailor the user experience as much as possible.”
Marketers should essentially be concerned with GDPR’s immediate impact on two key topics: big data and personalisation at scale.
One of the biggest pain points of the new law is the potential loss of data. The hypothesis is that the overall volume of first-party data will shrink as users exercise their right to keep personal data to themselves. By requiring companies to obtain explicit consent for all data points, existing and new, the regulation significantly increases the costs associated with collection, storage and processing.
Overall costs, along with the novelty of the law, could mean that a lot of companies could end up deleting far more dark data (data of unknown value) than necessary in the process. This could radically diminish data pools of valuable information worth billions of dollars.
In addition to the fate of first-party data, the fate of third-party information has perhaps been the most debated GDPR subject. While many perceive third-party data to be so deep-rooted within the digital marketing ecosystem that it is too stable to fail, a significant number of people also see it being the biggest casualty of GDPR. One of the most popular hypotheses is that, due to third-party businesses being the most convoluted of all data entities, companies may shy away from sharing their data altogether, thereby shrinking overall access to third-party data. Anyone who has run a programmatic campaign or leveraged a DMP can understand the drastic repercussions of this on his or her campaign strategy. That being said, if data is cleaned and processed the right way, GDPR may serve as just a temporary hiccup, slowing down big data only for the time being. However, in the long run will provide a better standard for more focused and high fidelity first-party and third-party party data.
While some advocates of GDPR believe that access to cleaner and more focused data will only improve the user experience and provide more qualified leads, this in fact is a real-life A/B test that will only reveal the outcome in due time.”
It is evident that we have now entered a highly sensitive era of consent. Most consumers were already treating the recent spate of GDPR related email opt-ins as a spring-cleaning of their inboxes. Many marketers therefore fear the potential loss of data will cripple behavioural targeting and annihilate most cookie data. As a result, one of the probable consequences is that email marketers will be the worst hit entities due to the potential loss of customer email IDs, which are the life force for their lead generation campaigns. I also see this having the greatest impact on e-commerce and lower-funnel industries such as airlines, hotels and telcos, which rely heavily on personalised targeting capabilities to drive greater ROI.
The potential implications for businesses therefore entail coming up with innovative ways to hone customer trust. It’s every marketer’s dream to leverage the treasure troves of data to increase overall efficiencies and personalisation at scale. Ultimately a business’s end goal is to drive revenues while a consumer’s end goal is to have a seamless experience that’s least disruptive to their consumption habits. For us marketing and ad tech professionals, it boils down to knowing our audience well and being agile enough to tailor the user experience as much as possible. However, by relying more on macro data and less on personalised, cookie-based targeting strategies, targeting capabilities could essentially regress back into the dark ages, leading us into an era of diminished personalisation. Less relevant ads may start to disrupt consumers’ user experience, while brands may start to see purchase intent drop as a result. All these predictions are assuming that previous access to data was of a decent standard and fidelity. We will therefore need to rely more and more on innovative ways to catch user attention and provide greater value to our customers. I foresee media ad buying scales tipping towards contextual buys versus audience buys, with brands reassessing the way they target users. Sophisticated content creation, collaborations with premium publishers and influencers and advanced semantic analysis tools might start to take a front seat when it comes to digital marketing. As a result, we need to change the way we create and offer content to our consumers.
While some advocates of GDPR believe that access to cleaner and more focused data will only improve the user experience and provide more qualified leads, this in fact is a real-life A/B test that will only reveal the outcome in due time.
Written by Nivritti Ashok at Zenith Media