Data Privacy: A Business Playground or Management Minefield?

After all, the age-old adage claims, “if you’re not paying for it, you’re the product,” and in no day and age is this truer than today. Data is the medium of exchange, and consumers have been giving it away freely. While sentiment has certainly shifted amid high-profile data breaches — of which, in the first half of 2021 alone, 18.8 billion recordsOpens a new window have been compromised — and regulators have rightfully taken note with more stringent frameworks, where does the data dilemma place today’s brands?

Trust as an Asset

In 2021, trust in the technology sector dropped to an all-time low, seeing the largest trust drop over a 10-year trend across all sectors, according to Edelman’s Trust BarometerOpens a new window . Accelerated by the pandemic, the drop almost seems paradoxical, considering the extent to which technology has been so crucial in enabling us to adapt to an increasingly contactless environment. Indeed, we have seen that over the years, users all over the world are increasingly concerned about how brands and platforms are using their data. According to We Are Social’s Digital 2021 ReportOpens a new window , the global average percentage stands at 33.1%, with figures rising up to 53.9% in countries like Portugal. With so many social media giants now under the regulatory spotlight, the shift in sentiment comes as no surprise.

To hold them accountable, regulators are demanding more from today’s tech giants. Perhaps largely spearheaded by the introduction of the European Union’s General Data Protection Regulation (GDPR) in 2018, the expectations in how customers ought to be treated across the digital landscape are changing. Now able to withdraw access to their data or demand its deletion under the framework, the GDPR’s Article 30 also demands that data controllers need to maintain a record of all processing activities, outlining how an individual’s data was used, for what purpose, by whom, and for what duration of time.

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It is clear that accountability, under the eyes of today’s data protection frameworks, is no longer a nice-to-have; it is a legal requirement. While the burden of upkeep and compliance may seem prohibitive, with 88%Opens a new window of all GDPR-compliant companies spending more than US$1 million on their data compliance efforts, the benefits in the long term are significant. In a crowded commercial digital landscape where consumers are inundated with so many options, trust is an easy thing to lose and so much harder to regain.

Navigating the Complexities of Compliance

That being said, cultivating a culture of compliance also needs to come from within. Despite attempts to improve consumer data collection standards with a host of data privacy regulations, the industry still lacks universal standards and technology ecosystems that provide transparency and optimize data sharing, ownership, and monetization.

Across the marketing technology landscape, we are now seeing meaningful efforts at this as industry players come together to develop alternatives to existing identifiers in the wake of Google’s decision to cease support for third-party cookies. With a renewed focus on first-party data, brands and publishers are now recognizing the need for cross-industry collaboration.

Meanwhile, Martech players are looking to emerging technologies to better bolster their efforts at data compliance. The use of blockchain, for one, provides an immutable, tamper-proof ledger of transactions which enables brands to comply with the stringent auditing requirements laid out in frameworks such as GDPR. With blockchain, brands can easily record all the events in which user data has been used and for what purpose, all without the ability to manipulate or falsify records.

On the consumer side, the Data Privacy Protocol AllianceOpens a new window (DPPA) is poised to empower consumers with greater control of their personal data. As a decentralized blockchain-based data ecosystem, the DPPA offers an ecosystem where the world’s leading data aggregators, intermediaries, and users of that data can collaborate to define universal standards of data usage and privacy.

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A Work in Progress

Similarly, a fragmented geographical regulatory regime can no longer serve as an excuse for non-compliance even if sentiment among consumers varies and regulatory appetite differs. While the GDPR has been heralded as the gold standard for years now, giving EU citizens and residents the greatest data protection rights, different jurisdictions around the world, including the Asia Pacific, have been working toward a more regulatedOpens a new window environment.

In recent years, emerging markets like India and Indonesia are working toward introducing new privacy legislation, and comparatively developed nations such as Singapore, South Korea, Japan, and New Zealand are working on amending existing legislation. Most recently, Singapore has also been undertaking responsibilities by raising penaltiesOpens a new window for inadequate organizational efforts with regard to mandatory breach notification. The recent upgrade also included tightening regulations around advertising and marketing tactics. As the data privacy landscape continues to evolve, it is likely that different Asian regulators working to develop and implement data protection laws will do so with the GDPR in mind.

As technology continues to play a pivotal role in every aspect of our lives, data will continue to occupy center stage when it comes to powering all of our digital interactions. This will always come at a cost, for better or worse, and for brands and consumers alike. For brands to maintain a competitive advantage among their peers, it is clear that trust will be the ultimate deciding factor that sets them apart. Today’s consumers deserve better — it’s time we start recognizing that.

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