Sunday 23 September 2018

Unlike Y2K scare, new EU data rules are set to cause havoc for marketers

'Anyone working in the marketing industry in Ireland who remembers Y2K can be forgiven for feeling a sense of deja vu at the moment.' Stock photo
'Anyone working in the marketing industry in Ireland who remembers Y2K can be forgiven for feeling a sense of deja vu at the moment.' Stock photo

John McGee

Anyone who remembers the scaremongering that took place in the build up to Y2K in 2000 and the so-called Millennium Bug, will probably recall the apocalyptic scenarios that were trundled out by the harbingers of doom and gloom. We were told that stock markets around the world might collapse, utility companies would be forced to shut down the national grid, there might even be a run on the banks and office and home PCs would simply give up the ghost.

In the best tradition of terrifying the bejaysus out of Middle Englanders, breakfast TV presenter Richard Madeley even threw open his personal 'millennium cupboard' to show viewers how he was stockpiling tins of food, candles and medical supplies. He warned them that they faced a New Year without water, gas and electricity and recommended that they should stockpile enough provisions to last 10 weeks.

Anyone working in the marketing industry in Ireland who remembers Y2K can be forgiven for feeling a sense of deja vu at the moment. With less than a year to go the introduction of the EU's General Data Protection Regulation (GDPR) panic buttons are being primed, marketers are breaking into cold sweats and uncertainty is the only certainty.

But unlike Y2K, however, marketers have every reason to be concerned as the EU has effectively lobbed a massive hand-grenade into an important industry and done a runner. In a nutshell, the GDPR affects any company that collects and processes the data of an EU citizen. A wide-ranging regulation, it's supposed to improve and simplify data protection for EU citizens.

It's impact will be deeply felt throughout the business community, from your local florist or hairdresser who sends you a text to let you know of an offer, a retail chain or airline company that has you as member of their loyalty programme, right up to the digital giants like Google and Facebook and other parties in the digital ecosystem that use people's data to gain a competitive advantage like serving advertising into your personal social media feeds.

Not surprisingly, many marketers are totally unprepared for what lies ahead. In a survey undertaken by the World Federation of Advertisers two weeks' ago, for example, 70pc of brand owners said that they felt marketers in their organisations were not fully aware of the implications of GDPR. Only 65pc said they expected to be fully compliant before the rules come into force in May 2018 and just 41pc said they already had a strategy in place.

The knowledge gap was more severe among marketing teams based outside the EU, with 56pc of the respondents saying that their European teams, some of which are based in Ireland, were more aware of the challenge. This is important because the rules apply to any company which offers goods or services to consumers in the EU or monitors the behaviour of people located in Europe, regardless of where they are headquartered.

Given that Ireland is the EU home to many of the digital companies that use personal data to gain competitive advantage, it's entirely conceivable that many high-profile case studies will emerge from these shores in the future and our data protection capabilities will be under considerable scrutiny.

But the confusion that reigns within the marketing community is going to cause all kinds of problems for marketers when it comes to interacting with their customers according David O'Sullivan, managing director of Dublin-based marketing agency Ignition. It works with a range of blue-chip clients that use customer data as an integral part of their day-to-day operations.

"At a time when consumers are looking for more substantive value and rewarding relationships from companies and brands, GDPR will potentially become a creative log-jam for marketing communications that actually benefit consumers," says O'Sullivan.

"Nobody disputes the need to protect people's personal data from fraud, misuse or compromising their privacy but the issue for most marketers is divining whether this will be at the expense of not being able to use data at all when it comes to communicating brand benefits and value to customers. That is the level of confusion that's out there," he adds.

He says that the fundamental problem for GDPR is one of appeal and, as it stands, there's nothing in it to set the hearts of marketers and their agents aflutter. "GDPR has already lost the PR battle, as a culture of fear has taken root within the smallest partnerships, SMEs and lumbering corporations."

When companies start to assign internal responsibility for compliance with GDPR, it will start to get messy, says O'Sullivan. While big companies will appoint data protection officers, the grim reality is that smaller firms don't have that luxury and level of expertise.

"Avoiding the poisoned chalice of assigning compliance responsibility to finance, IT or marketing, has become more like fighting for a place on Noah's Ark," he says.

Sunday Indo Business

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