By Russell Howe, VP EMEA, Ketch
In the last number of months, cosmetics giant Sephora agreed to pay a $1.2 million settlement for selling consumer data without disclosure, and failed to process opt-out requests, In the U.K., catalogue retailer Easylife Ltd was fined £1.48 million for using the personal information of customers to target them without their consent. These developments have sent waves through the marketing space, causing many to sit up and take notice of not only the high price tags that can come with data malpractice but the reputational damage as well.
The Sephora case is every brand manager’s worst nightmare. It’s bad enough to fall victim to a data breach, or get exposed using poor data security practices, and to have to pay the price for it. But the negative publicity that goes along with the misuse of data adds a new level of retribution for the companies who get caught out.
CMOs in the spotlight
Consumer privacy laws are not going to loosen up any time soon, and this holds true across all major markets. The U.K. has recently announced that it may ditch its allegiance with GDPR in favour of a UK-centric data regime – but U.K.-based businesses managing data held by anyone within GDPR-covered areas will still need to adhere to the regulations. In the US, meanwhile, a nationwide data protection effort is underway with the American Data Privacy and Protection Act (ADPPA). This is in addition to several existing state-level regulations protecting consumers’ privacy and online behaviour in California, Colorado, Connecticut, Virginia and Utah, among others.
As data protection laws and regulations are strengthened, consumers, too, are becoming more clued-in about their privacy rights. Stung by high-profile breaches and distrustful of the data handling practices by companies like Meta and Google, consumers are understandably vocal about how they expect their data to be collected, managed and shared.
All this means that CMOs and marketing executives are finding themselves in the spotlight; regulators are scrutinising their data handling practices, and consumers are watching too. The time has come for marketing professionals to get proactive about consumer privacy. Get it right, and you’ll build trust, loyalty, and ultimately generate new business.
Marketers as data guardians
Marketing professionals have been quick to adapt their processes and approaches to data in line with new laws and regulations. Website terms and conditions are more specific, online forms include opt-in checkboxes at every turn, and it’s become much easier for consumers to change their data sharing preferences, unsubscribe from unwanted communications and take control of brands’ tracking capabilities. This has been a step in the right direction.
But there’s no denying that these laws and regulations have also had a significant impact on the work of marketers. They will continue to do so.
Personalised consumer journeys and granular targeting has long been the gold standard of marketing and advertising plans, but brands no longer have carte blanche to build personas and campaigns without data privacy front and centre. Undeniably, this creates a difficult situation for marketers to navigate – but it’s not the end of marketing or advertising as we know it.
CMOs need to respect people’s data dignity when it comes to targeting and advertising practices. They need to balance hyper-personalised targeting with responsible data practices. The transition may be difficult, but we should all see this shift to a more transparent, trustworthy way of handling data and protecting our consumers as a net positive. In the eyes of consumers, the brands they trust are responsible stewards of their data, which is why a privacy-by-design ethos is so critical for brands.
Paying attention to responsible data practices
Brands and businesses must cultivate a sense of integrity, trust and transparency before they collect data from their consumers. Consumers must be informed, in simple terms, about which data is collected and how it will be used.
They should be given choice and control over that usage, with the ability to come back anytime and update their preferences. Data should be securely stored, and for an appropriate period. That is, collect what you need, for a specific purpose, as agreed by your consumer, and store it for only as long as required to fulfill that agreement.
The future of marketing
All CMOs know that effective targeting and personalised content can make for a strong, consumer-focused marketing campaign, and marketers will always need data to do their jobs well.
The future of marketing and consumer privacy unlocks the synergy between the use of data and consumers’ privacy preferences and expectations. This is achievable – and marketers are already beginning to prioritise customer-first data privacy policies and responsible data-handling practices. When this approach becomes the norm, the outcomes will be overwhelmingly positive. Not only will businesses and brands be confident in their compliance with regulations, but they will also be able assuage the fears of consumers. If customers believe that their data is secure and their privacy is respected, they will trust and value your brand more.