How the impact of EU’s new GDPR will change marketing practices

 

Posted on Jun 23, 2017

In 2018, the EU’s General Data Protection Regulation (GDPR) comes to effect, and despite all the talk of Brexit, the UK will still be affected by the regulations around May that year. These regulations are set to improve and simplify data protection for EU citizens, people residing in the EU and EU businesses, however, it has created quite a stir within the marketing industry. These regulations have the potential to fiercely shift the way marketers collect, handle and process customer data and according to many individuals in the enterprise community, this legislation is oppressive, complex and conflicts with their business interests. But how will the EU’s GDPR really affect marketing? And can we do anything about it? 

Although the EU’s GDPR is not quite as strict as many fear, it does affect marketing departments and mainly the email marketing process, and this is affected in three main areas: consent, security and compliance.

Consent is regarding opt-ins, opt-outs and communications. With the new legislation, marketers won’t be allowed to contact email users who do not opt-in and will need correct authorisation to be able to do this. This will include B2B and B2C emails and marketers will need to demonstrate that the audience have agreed for their data to be used and to be contacted. As the GDPR states, the consent must be “freely given, specific, informed, and unambiguous”. Marketers will now need to be very aware of who is in the database, which could potentially be beneficial as 20% or organisations’ databases are not relevant, which can cost organisations large sums of money. Subscribers will also need a very accessible way to opt-in or -out and this could be easily be achieved through a straightforward call-to-action as it doesn't matter how the consent is obtained as long as it comes from the customer. Since subscribers will also need to be able to remove their data, it would be beneficial to create a clearly identifiable route for them to make contact and communicate their request.

In terms of security, the EU’s GDPR forces marketers to improve transparency for data protection and storage mechanism. The legislation gives more control to individuals/consumers over how their data is collected, handled and processed, which also gives them the right to access and remove their data. Of course, this will only be allowed when there is no reason for their information to be processed, when they withdraw the consent and if the data is unlawfully handled. However, keeping this communication with customers and contacting them can potentially be beneficial for marketing practices as this interaction can help acquire new data on a detailed scale.

And finally compliance, not many companies are adequately equipped to tackle such a dramatic shift in this area. With the new regulations in place, the compliance aspect of GDPR will be inescapable, and any efforts of avoiding this will result in big costs that many firms can’t handle. This will mean that a better data management with be needed from marketers and less unnecessary data collection. Since the compliance aspect of the GDPR is the part that will affect marketing practices the most, it has become a priority for 92% of world organisations in 2017. It would be beneficial to assign someone to supervise the compliance process, this could be an individual or a business, but making sure this person/organisation has extensive knowledge/experience in EU compliance.

Failing to follow the guidelines could cost businesses large amounts of money, in some cases the fines can get up to around £20 million or 4% of global turnover. To achieve this transformation, businesses will require a lot of planning, effort and time, however, following the guidelines could actually become beneficial to marketers. The legislation obligates businesses to focus on gathering important, relevant and legally compliant data, which is a smart move as collecting data indiscriminately doesn’t benefit marketing practices in any way. Stats show that 42% of marketers do not send targeted email messages, even though, according to the Direct Marketing Association, segmented and targeted emails generate 58% of all revenue. 87% of marketers consider that data is their organisation’s most underutilised asset, these regulations will allow Marketers to spend more time going through their data which could potentially be a great move.

As a marketing agency, the EU’s new GDPR will be affecting us directly. Leah Hickey, Marketing Manager at Why Media comments....

“ Even though the new data protection regulations will be affecting marketing agencies, we consider this to be a beneficial move for the industry, obligating businesses to follow good practice and giving consumers peace of mind and protection. For us marketers, we will be able to target the right audience in a more precise way which will eliminate non-value-adding actions and its costs.”

Businesses need to make sure they educate their staff on the new regulations and allocate the new strategies or processes far in advance to make sure the business is in a good position by the start of the legislation.