Ethical Marketing: Leveraging Data Privacy to Improve Customer Experience and Brand – Part I
Since the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) came into effect (May 2018 and January 2020 respectively), the concept of “ethical marketing” has increasingly become top of mind.
Of course, the immediate concern for businesses is achieving and maintaining regulatory compliance. But, particularly concerning to marketers are the constraints concerning the “sale” and use of consumer data and the ability of consumers subject to these regulations to “opt out” of that use.¹ This is not only a regulatory concern but directly challenges the heart of the digital marketing ecosystem.
As former Obama administration Acting Under Secretary, U.S. Department of Commerce and WireWheel CEO Justin Antonipillai notes, the “issue of ethical marketing has become a huge one for most companies in the last couple of years…How do we think about targeted marketing and use of consumer data, but to do it the right way?”
Martech and Ad Tech Impact
With the passage of the Consumer Privacy Rights Act (often referred to as CCPA 2.0) set to go into effect 1 January 2023, working with consumer data, to not only satisfy regulatory compliance, but doing so ethically and effectively has taken on an absolute sense of urgency for marketers. The impact to Martech and Ad Tech is profound. It is with this as backdrop that WireWheel’s Justin Antonipillai sat down with LiveRamp VP, Head of Innovation & New Business Rishabh Jain to record their discussion Ethical Marketing: Where Trust and Personalization Intersect.
While the CPRA does not go into effect until January 2023, because there is a look back from January 2022, leading edge companies are being proactive regarding its implications. They recognize that how they handle privacy is an opportunity to improve customer relationships – including those consumers not subject to the GDPR or CPRA. As LiveRamp’s Rishabh puts it: “I think that there’s a lot of opportunity right now for using privacy as a strategy to increase trust with consumers as opposed to viewing it as simply compliance.”
In short, ethical marketing begins with making data privacy a core company value and continues by viewing privacy regulations as opportunities to gain trust with consumers. Apple’s iOS 14 ad tracking announcement, Facebook’s retargeting management tool (LDU), and Google’s announcement regarding third-party cookies are key examples of leading companies…well, leading…with the idea that data privacy is not simply a regulation, but a core brand value (More on this in Part II of this post).
The Consumer POV
“There tends to be two things consumers have taught me” says Rishabh. Firstly, “It feels like a lot of things are happening in the background that they don’t really understand or have control over.” The use of third-party cookies exacerbates that sense of lack of control. Secondly, “when they learn about it, they want to understand, can I turn it off? And in some cases, they want to understand actually can I make it better?”
“So I have actually heard it both ways, which I think is a signal that what users really want is to be able to understand it and control it, not necessarily just turn it off.”
This attitude is not unique to Californians or citizens residing in the European Union. It really is common across all geos and demographics. Consequently, forward looking organizations like Apple are not necessarily bucketing their customers and prospective customers as Californians/Not Californians, Subject to GDPR/Not Subject. Rather they understand that consumer sentiment is in alignment with these regulations and view increased transparency and control as more ethical and valuable. “I think it’s pretty clear what consumers want” says Jain:
“You know, it’s voters who voted for the CCPA and CPRA. It’s not legislators in a room somewhere who came up with this, it’s a proposition and so it is people in California who said, ‘we want this.’ And then they said we want it again.”
“And when people are telling you what they want, it tends to mean they want it. And if you show that you’re listening, and you show that you’re listening sooner rather than later, they will trust you more.”
Forward-looking organizations are listening, and they are moving beyond compliance and thinking in terms of ethical marketing as strategy.
The Brand POV
Needless to say, companies still want to continue to market and advertise and be able to target potential customers effectively. And there will certainly be challenges.
Google Chrome’s planned obsolescence of third-party cookies; the perceived “creepiness” of cookies, Facebook Pixels and server-side API; the CPRA’s addition of Sensitive Personal Information (SPI) to the category of Personally Identifiable Information (PII) and attention to “cross-context behavioral advertising;” all portend challenges to the traditional Ad Tech approaches to, and Martech use of, identifying, segmenting, targeting, and retargeting customers and prospects. The Facebook LDU implementation earlier this year demonstrated with resounding clarity the impact of “do not sell” on marketing efficacy.
This is a trend that promises to continue, notes Justin. And operationalizing consumer relationship in light of these changes will be critical to success. And it is not a DIY affair which has led to “a lot of pain with not a lot of reward” for many. But those that get ahead of it – and understand data privacy as a new route to developing trust-based relationships – just may discover a significant competitive advantage over peers who merely aspire to compliance.
After all, “When someone grants permission they are acting consciously, becoming an active participant rather than a passive source of data to be pillaged. Permission equals engagement. And engagement is the ultimate goal here, isn’t it?” (Carroll, 2018).
Part II will look at what lies ahead, how to operationalize for today’s requirements and position for future challenges and opportunities.
- The definition of selling has been further defined by the CPRA as “selling, renting, releasing, disclosing, disseminating, making available, transferring, or otherwise communicating orally, in writing, or by electronic or other means, a consumer’s personal information by the business to another business or a third party for monetary or other valuable consideration.”
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