The collision of data marketing and privacy

Let’s be honest, data privacy has largely been ignored by the marketing-media industry. In fact, in January 2010 Facebook’s Mark Zuckerberg even proclaimed that privacy was no longer a “social norm”.

But regulatory demand and increasing consumer unease with companies playing fast and loose with their data means we are now entering a privacy-first era of marketing. (This theme is explored in WARC’s Marketer’s Toolkit 2020 and includes points of view from CMOs such as P&G’s Marc Pritchard, Hershey’s Gill Baskin and Ivan Pollard of General Mills.)

88% of respondents to our survey agreed, or strongly agreed that digital privacy will be increasingly important in 2020.

Lawmakers in many markets across the globe are implementing stronger data protection rights which will have significant implications for marketers. In 2018 the EU implemented the General Data Protection Regulation (GDPR) and this month the California Consumer Privacy Act (CCPA) came into force in the United States. Like the EU’s GDPR, the CCPA limits how companies can collect, store, use and share customer data and gives consumers more control over their personal information.

Even in China, a country whose citizens appear most comfortable trading privacy for convenience, there are signs of changing attitudes. China’s Personal Information Security Specification proposes an “unbundling” of data protection consents, which will affect the ability to use consumers’ personal data for marketing purposes. Marketers can expect greater scrutiny, particularly on data that is deployed for personalised marketing, such as transaction data, location and device data, and behavioural data.

These laws specifically impact companies that rely on the collection, usage, buying and selling of customer data. In other words, big social media giants, third party data brokers and online behavioural advertisers. Perhaps this is why, in March 2019, Mark Zuckerberg announced Facebook’s vision for a privacy-focused platform.

The disrupters are being disrupted by a new era of consent-driven marketing meaning companies must secure consumers’ informed or explicit consent before they can leverage their data. Opaque ‘data use’ policies and a tick box exercise are no longer sufficient.

Marketers will need to show they are compliant with data privacy laws. Here are some key considerations discussed in our report:

• Consumers are now more aware of their data, and that it has value. Numerous surveys show people are increasingly uneasy about sharing their data and are taking steps to limit their online footprint by sharing less data online, deleting tracking cookies, opting out of geo-location services or downloading adblocking software. 66% of respondents in our survey agreed or strongly agreed that consumers will take greater control of their data in 2020. One area to watch is the personal data economy, which enables consumers to trade their data directly with companies. This approach is based on informed consent and a transparent value exchange. While it is unlikely this idea will gain significant traction in 2020, marketers should be considering how it would affect their longer-term plans. 

• The Holy Grail of marketing – the ability to target the right consumer, at the right time, in the right location, on the right platform, with the right message – is now even harder, because transparent consumer consent must be sought, across all touchpoints. And Gartner predict that by 2025, 80% of marketers will abandon their personalisation efforts. In the privacy-first era marketers should focus on data minimisation – quality, smart, secure data is best practice. Some 58% of respondents to our survey said they have a strategy for actively collecting first-party data from customers.

• As third-party, cross-website cookie tracking is being phased out on Google’s Chrome (it is already blocked on Apple’s Safari and Mozilla’s Firefox), it will be even harder for marketers to ‘know’ or target online consumers. This will have huge implications for the future of marketing – and the future of consumer privacy. It remains to be seen what will replace the cookie. One approach is to buy media based on contextual triggers. As Kantar research from 2019 shows, “site context and ad congruence can boost campaign impact significantly.” 

• Despite stronger regulation, the desire to ‘know’ or identify the consumer – both online and offline, and across all touchpoints – will not abate. Therefore, the future of customer identity will be a major battleground for brands. It’s a battleground that regulators will be watching closely...

• Emerging technologies that promise to make peoples’ lives easier – while collecting more data about them – could be treacherous for marketers. Data collection via microphones, voice assistants, connected TVs, IoT devices, health apps and connected cars must be done in a way that enables people to give their informed and explicit consent. Marketers engaging in emerging tech should ensure they are compliant with data privacy laws, or risk a hefty fine and loss of consumer trust.

• New regulations change the data landscape, but there are opportunities for brands to present themselves as ‘privacy first’ to consumers who are wary of how their data is being used. Apple is leading the way here, however, data use is so broad it is hard to audit everything. Even Apple has had to apologise i.e. when it was revealed that human contractors were secretly listening to recordings of people talking to Siri, it's smart assistant.

It's important for brands to be trustworthy and transparent around consumer data - not only is it the right thing to do, it's also good for business. A 2019 Forrester report showed a 17% positive ROI for privacy investments for B2C businesses.

As this new permission-led approach to data becomes the new normal, consumers will increasingly choose brands that demonstrate they can safeguard their data, brands that clearly inform people how their data is used and for what purposes, and those that enable them to easily opt-out if they so wish.

Regulation is trying to catch-up with new and emerging tech, but it’s always going to be a step behind. Therefore, it’s up to companies to decide that they want to do the right thing.

Lena Roland is managing editor van WARC Knowledge (warc.com). Warc is een expertisebureau op het gebied van marketing en effectiviteit dat jaarlijks onder meer de Marketer’s toolkit uitbrengt, gebaseerd op onderzoek onder meer dan achthonderd internationale marketeers aan klant- en bureauzijde.