May 1, 2018 by Lindsay Gavey

The time for brands to adopt a data privacy strategy is now

A seismic shift in how brands manage users’ privacy is underway.

Issues surrounding data collection and commercialization have flitted in and out of view over the past 20 years. But a series of recent events – the Cambridge Analytica scandal, new government legislation, the testimony before Congress of Facebook executive Mark Zuckerberg – have thrust them firmly into the spotlight.

The difference is that, this time, they won’t be exiting the stage.

Privacy issues, particularly the ones surrounding the collection and management of user data, aren’t going away. Not only that, they will likely, as users become more aware of how their data is used, continue to grow in the years to come.

So – what are brands supposed to do?

The temptation for many will be to carry on with business as usual. Privacy issues, some will say, have always been something to which brands need to pay attention.

But the latest debates about data privacy are different. The stakes are higher. The legislative landscape has changed. And, most importantly of all, audience preferences are becoming more sophisticated.

Which means that, for brands, the time to articulate a strategy not just for privacy – but for data management in general – is now.

Brands and data privacy: A brief history

A lack of clarity and accountability has defined the digital ecosystem.

Brands had broad access to users’ personal information and control over the content served to them. Few brands or platforms asked questions about how much was too much data to gather and, philosophically, which marketing channels were off limits.

Audiences, in return, asked few questions about how their data was used. In the early days of Facebook and Twitter, to take two more culturally prevalent examples, they would blindly sign up for accounts with little regard for how it affected their privacy.

But the discussion around privacy this time is different.

To wit:

– Governments across the world are passing legislation that will greatly expand the responsibility brands have for obtaining, managing and protecting user data. The European Union, to take the most salient example, is preparing to launch the most comprehensive piece of legislation aimed at protecting user privacy

– Brands are beginning to build a commitment to respecting users’ privacy into their value proposition, using data as a means of differentiating their company from others. HubSpot, an inbound marketing software as a service tool, used the recent testimony of Facebook founder Mark Zuckerberg as a chance to highlight their approach to privacy and data use.

– People are starting to ask more questions about what companies know about them and how that information is being managed. Some high-profile users have, for example, opted out of Facebook’s platform after the most recent privacy scandal.

The rise in privacy issues for brands

So, why are data privacy issues reaching a tipping point?

Because we’re starting to see the effects and better understand the implications of the structural problems in the current system.

Data commercialization (ad targeting) is one thing. People are now starting to understand that their online activity affects which ads are served to them, that the shoes they looked at several days ago on an online store aren’t just randomly following them around on disparate websites around the web.

But there is a darker side to the issue: The surveillance economy. Here users are watched, listened to and manipulated in a way that influences their beliefs and decision-making. We’re not just talking about purchase patterns (though that is part of this). We’re talking about bigger issues, such as the potential effects that a black hat Facebook advertising campaign had on influencing the 2016 U.S. presidential election.

If data can be used to manipulate something as serious as the fate of the free world, what can’t it do?

What privacy issues mean for brands

The sudden rise in privacy concerns will have far-reaching impacts – and they’ll stretch beyond individual brands.

At the company level, how brands manage and protect their audiences’ data will be a differentiator for brands as user interest in privacy issues continues to grow. There is much to gain by implementing this before and better than your competitors.

But there is also something bigger at play here.

The data crisis is leading to an erosion of trust that is forcing advertisers and platforms to very quickly respond with revisions to their current policies and practices that address the concerns.

Brands (and their agencies) need to push for greater accountability and advocate for a system that we can all be confident in. Otherwise, audiences will tune out and brands will lose confidence in the tools they use to reach them.

Privacy: What’s a brand to do?

The time for brands to passively deal with privacy issues has passed.

If you are investing in advertising and marketing technology of any kind, you should have a data strategy that includes data protection policies and protocol.

Unfortunately, many brands are still struggling to understand the data they have and get a clear and accurate picture of their audience. For most, data is siloed, knowledge is not shared, and not easily actionable. Regulation brings additional complexity and threatens access to data – not to mention heavy penalties for lack of compliance. Brands feel uncertain.

The data crisis brought on privacy concerns, and regulation is forcing brands and platforms to review their data practices – smart brands will not only to adjust for compliance to the EU regulation, but recognize the opportunity to review their data strategy to position themselves for future success, and build trust with their audiences.

It’s one of the reasons why Facebook recently launched its biggest (ever) ad campaign. The campaign is no mea culpa, but “Here Together” directly acknowledges users’ privacy concerns and indicates that the company is making an effort to address the issues.

In the future, successful brands will have a data strategy that prioritizes transparency and consent, and demands compliance – and accountability – of data partners, they will expand their marketing efforts beyond digital, and reap the rewards of securing their audiences’ trust.

Lindsay Gavey is the Director of Marketing Strategy at Banfield.