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Narrowing the Data Perception Gap: What Impact Will GDPR Have On Transparency?

Jed MoleJuly 04, 2017

 

Why are consumers so often concerned and mistrustful over the use of their personal data?

Given increasing consumer awareness of personal data; from its creation, to its usage, to the portrayal of data in the news and media – it’s understandable that consumers want to know more – and are wary of cases of data misuse.

As a 2015 study (‘What the Consumer Really Thinks’) by the DMA (UK) and Future Foundation found, despite natural wariness, consumers are increasingly understanding of the benefits of appropriate data use, and expect to see value from their shared personal data:

73% of people agreed that in the internet age, you have to provide personal information in order to buy things.

However, a perception gap remains, with many consumers experiencing misplaced distrust around data use.

So how can marketers reduce this mistrust and create a more transparent relationship that also aligns with the upcoming GDPR?

 

Narrowing the Perception Gap

According to the above mentioned 2015 DMA (UK) and Future Foundation study, ‘trust’ is the number one reason for sharing data; so it follows that consumers know data is being ‘tracked’ (admittedly an emotive term) – yet far fewer see it making a difference.

If this is the case, it’s understandable that if consumers are not seeing value, they may struggle to continue to trust those who have and use their data. For marketers and those in the data industry, this should highlight a priority; beyond the baseline of keeping data safe, to retain trust, it’s crucial to deliver value to the consumer.

Beyond the baseline of keeping data safe, to retain trust, it’s crucial to deliver value to the consumer.

Unfortunately, some people have a ‘one-size-fits-all’ understanding of data which greatly clouds their perceptions of our industry. Personal data may be used for many purposes but more sensationalist voices group the data used for marketing in exactly the same category as data used for far more sensitive purposes, such as financial services, healthcare, and even crime and security; this is ludicrous. Indeed, it can be seen in mainstream press that journalists will use colourful language such as ‘companies compiling dossiers on individuals’ or ‘hoarding personal information’. This gives the perception that brands and marketing services or adtech companies are spying on people rather than simply using data to drive more relevant marketing.

 

How Does GDPR Fit Here?

It is hoped that the increased transparency required by GDPR (or its post-Brexit equivalent in the UK as GDPR is an EU regulation), will engender a higher level of overall trust within consumers who will feel more assured not only by more regulation, but also by much greater penalties for any infringement. Both of these factors have been covered by national news outlets, and are likely to be emphasized again as we approach May 2018 (the GDPR enforcement data) or the equivalent date for any Brexit regulation.

As consent guidance under the GDPR becomes more strenuous, we predict that there will be a move towards legitimate interests as an alternative legal basis to process people’s data. This involves balancing legitimate business data use against an individual’s privacy to see which side is “heavier”. The GDPR itself expressly recognises that direct marketing is a legitimate interest which is a good start. Further, the pursuit of this legitimate business interest is in the interests of the “wider community” as it allows it to receive less waste, more relevant marketing as well as free content.

The GDPR itself expressly recognises that direct marketing is a legitimate interest… Further, the pursuit of this legitimate business interest is in the interests of the “wider community” as it allows it to receive less waste, more relevant marketing as well as free content.”

Transparency also forms part of the ‘legitimate interests’ balance. However, for third party marketing to continue to offer alternatives or complementary options to the so-called “walled gardens” (closed environments or services which do not share their users’ data beyond that ecosystem – such as Google, Amazon and Facebook) there needs to be a recognition that businesses or organisations not in direct contact with consumers will at times struggle with transparency. On account of such service’s positions within the marketing ecosystem, the privacy enhancing measures that they employ should be given increased weight to tip the balance in favour of data use. (Example services include pseudonymisation or de-identification (a process by which a user’s identifying markers on their data are removed and scrambled before it is matched or processed, so any data augmentation or analytics partner cannot identify an individual from their data).

This recognition must also be in the consumer’s interests to avoid online marketing budgets being dominated by social media, search and shopping platforms, and thereby stimulate competition. Alternatively, more of the spend could move offshore to more nefarious outfits which continue to target Europeans but are beyond the practical reach of the regulator – which would be a “lose-lose” for everyone!

That said, we also predict that in the period immediately following the introduction of regulation, GDPR or similar, businesses are likely to see a spike in the number of Subject Access Requests (SAR) and opt-outs. This will be caused by the increased publicity beforehand, a lack of understanding around the data balance as discussed and the regulations promise of a zero cost SAR.

 

Ensuring Transparency

Ultimately data transparency over legitimate data usage is key to maintaining trusted, GDPR-compliant relationships with consumers. Over time, this should lead to increased consumer trust and understanding; so enhanced value for marketers and consumers alike.