The consumer privacy landscape is constantly evolving. Potential regulations like the American Data Privacy and Protection Act (ADPPA), which resemble current laws set forth by the General Data Protection Regulation (GDPR), are keeping marketers on their toes. Meanwhile, other major trends dictating how and when marketers interface with consumer data are on the horizon (such as Google’s deprecation of third-party cookies, which has again been delayed to Q1 2025).
With digital marketers exercising minimal control over these developments, the data privacy landscape may seem confusing and frustrating. However, robust data privacy protections build trust and protect users and companies.
More than ever, consumers prioritize their data privacy and are willing to hold companies accountable for breaching it. More than half of consumers (58%) say they’d stop interacting with a company boasting a bad “data reputation.” Another 52% would stop doing business with a company that doesn’t provide an option to opt out of tracking. On the flip side, consumers reward and respect organizations that prioritize privacy. Six in 10 consumers say they’d spend more money with a brand they trust to handle their data.
Businesses that acknowledge and respect these distinctly modern preferences will create a competitive advantage. But first, they need to understand the intricacies of contemporary consumer privacy.
Compliance Is Just the Start
Most marketers are familiar with the biggest consumer privacy regulations, including the GDPR and the California Consumer Privacy Act (CCPA). These laws dictate how companies can collect consumer data transparently and fairly, namely by informing all consumers about the intent of collection.
Non-compliance can result in massive fines and irreparable harm to a company’s reputation. For instance, in April 2024, healthcare company Kaiser Permanente reported the inadvertent sharing of 13.4 million customers’ personal information, including IP addresses, with third-party advertisers. Although fines haven’t been established in this case, the sharing itself may open Kaiser to heightened customer scrutiny.
However, adhering to data privacy regulations should be the bare minimum. We know that consumers are more privacy-conscious than ever before. They’re willing to spend more – and more often – with companies they trust. So, the question becomes: How can companies uplevel their data privacy strategy to meet and even exceed consumer expectations?
A Note: Consent Collection vs. Enforcement
While gathering consent ensures that you have the necessary permissions to process user data, enforcing these preferences throughout your vendor ecosystem is another crucial consideration. Without enforcement, consent collection is meaningless, as user data may still be mishandled or shared inappropriately. Proper enforcement means actively synchronizing and applying consent categories to all data routing and integration processes, ensuring that each user’s preferences are respected at every point of interaction. This not only protects user privacy but also enhances the reliability and integrity of your data operations, preventing potential privacy violations and fostering trust with your users.
Often, businesses face challenges in ensuring that the consent categories set by their consent management platforms (CMPs) are accurately reflected in their data collection processes. This misalignment can result in user event data inappropriately entering downstream tools. With advanced consent enforcement, customers can now effortlessly synchronize their consent categories with their data collection and routing strategies, eliminating the risk of sending user event data where it shouldn’t be. This establishes a robust connection between the CMP and the data collection engine, ensuring that they consistently align and preventing any unintended data leaks or misconfigurations.
Moreover, leaders should consider minimizing the data they collect by ensuring it genuinely advances re-targeting efforts. Because personal data is a liability, it should always be treated carefully.
Improving Outcomes with Outstanding Privacy Protections
Organizations can take a few other, more proactive measures to bolster their data protections and improve customer satisfaction. These include:
- Encouraging transparency around data collection policies: A staggering 67% of consumers don’t understand why companies collect their data or how they use it. Organizations are responsible for raising consumers’ awareness of data policies. The GDPR dictates transparency about data collection. For example, companies cannot mislead consumers about how their data will be used. However, companies should go the extra mile by providing proactive notices about when consumer data will be used (and when it won’t be).
Consumers must also know when their information will be shared with third parties. For reference, 46% of consumers believe their data won’t be shared following a purchase. Learning about third-party data-sharing after the fact can significantly damage brand trust and reputation.
- Prioritizing first-party data, if possible: Unlike third-party data, first-party data is collected directly from consumers, making it more reliable, up to date, and easy to manage. Gartner reports that top brands are 2.2 times more likely to use data acquisition tools on their web and mobile platforms. First-party data allows marketers to act immediately on consumer behaviors, such as visiting a website or engaging with social media content, capturing purchase intent in a timely manner. Additionally, server-side tagging and cross-domain tracking enable the collection of first-party data without needing personally identifiable information (PII), enhancing data privacy practices.
- Improving data governance strategies: Regardless of data’s provenance – first-party or third-party – it should be managed carefully. To that end, organizations must adopt strong data governance practices to ensure integrity and security. This can be accomplished by adopting a “shift left” mentality implementing data governance concerns closer to the point of collection (e.g., cleansing data during collection instead of after the fact).
Additionally, when sharing consumer data with a third party, ensure all stakeholders agree to proper data use protocols. Similarly, when receiving third-party data, confirm the hosting organizations have robust data privacy protocols. Remember: Organizations can be liable for misuse throughout their entire data supply chain.
Customers of Tomorrow
If labor-intensive practices like tag management and consent enforcement seem burdensome, I encourage you to consider how improved consumer privacy protections and data collection tools can benefit your organization. Customers are more interested in protecting their data – and more pessimistic about data privacy – than ever. Organizations can capitalize on this sentiment by becoming robust data stewards.
Embracing data privacy as an opportunity rather than a burden can lead to improved outcomes, stronger customer relationships, and a competitive advantage in the market. Companies that proactively take action on data privacy can improve the bottom line today and increase customer trust tomorrow.