How Digital Privacy is Challenging Marketing

 

Data is a goldmine for businesses seeking to target their customers more effectively. However, the increase in privacy laws and an emphasis on consumer awareness have made the collection and usage of data more challenging.

Technology has reshaped the playing field for marketers, who can reach customers on a global scale at their fingertips. In the last decade, marketing has evolved into an interactive, cost-effective way to build relationships and generate revenue. Marketers and businesses can use Google, Bing, Facebook, Instagram, Pinterest, Snapchat, LinkedIn, and TikTok to run ads and advertise their products and services. Not only are ads run in these various channels, but they can also be run on browsers, apps, TVs, tablets, and phones.

Though recent technological advances have made it increasingly easy to target consumers with highly specific products and services, online data collection makes many consumers uncomfortable. There’s a growing concern from individuals regarding the collection and utilization of their personal data.

As consumer privacy becomes increasingly important and data practices are closely examined, digital advertising giants like Google, Facebook, and even Apple are changing the way their services work and how their users’ data is protected. This means stakeholders are taking user privacy and online security seriously by imposing privacy-first practices. These new privacy policies are the latest step in the rise of the “internet of things” which refers to interconnected devices exchanging data in near real-time. At the same time, these threaten to shake up the marketing landscape, introducing new challenges and opportunities.

With that in mind, what does this mean to you as a marketer or an individual running a business’s marketing campaigns? What impact is there and what can you do to overcome these challenges? Don’t switch the page because this blog will provide a detailed answer to those questions.

Understanding the New Data Privacy Laws

The privacy policy is designed to provide transparency and control over how a consumer’s personal data and information is collected, stored, and used by third-party organizations. While demographic and personal details help marketers make focused advertising efforts, many users are becoming increasingly concerned about the collection and utilization of their information. This leads to governments and agencies beginning to enact laws and regulations on consumer privacy.

It’s no question that the stricter data privacy laws have had an impact on marketers and businesses. Today, they continue to seek new and exciting ways to engage their audiences, yet their most concern is privacy compliance. Moreover, with increased scrutiny on privacy and tightening regulations, the ability for them to test, measure, and optimize has been dampened. The news that more platforms and digital companies are enforcing a new set of restrictions to comply with privacy laws is simply one hurdle for them to jump over.

The New York Times and the Wall Street Journal may get all the press, but several other privacy policies have been passed in the past years, including the EU’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act. Other states have also ratified similar legislation, like the Delaware Online Privacy and Protection Act (DOPPA). The introduction of the GDPR and other policies will fundamentally change how you can collect and leverage data to build and maintain relationships with customers. For those who specialize in marketing (as well as many other business functions), GDPR has been a real challenge.

With their aim to adhere to these rising privacy regulations, Google and Apple said they would improve user privacy by canceling third-party cookies in Chrome and other browsers. Firefox followed suit by blocking tracking cookies by default. Apple has also imposed more restrictive privacy updates to its mobile operating system. Users of iOS 14.5 will have to deliberately opt into sharing their unique Identifier for Advertisers (IDFA) with apps. This kind of technology is foundational to digital marketing and can be found in desktop, as well as mobile, operating systems. If users choose to opt out, it will limit the way they are tracked and reached with marketing messages, which will significantly mitigate the effectiveness of digital ads.

Meanwhile, Facebook recently changed its privacy policy again. This time, it pertains to what brands could find out about consumers on the social media channel, not with their own privacy. This was only a small part of an otherwise huge roll-out of privacy updates by Facebook into Europe and beyond.

With all that said, what do these new shifts mean for businesses and marketing professionals? You can’t count on cookies anymore to increase sales as you once did. Companies will have to be innovative and find other ways to collect data without jeopardizing the general consumer data protection laws. Furthermore, if you don’t update your marketing techniques and business strategies to reflect the presence of first-party data collection, you may find yourself spending significantly more on marketing and sales to achieve your objectives.

The Real Challenge

In the last two years, when the pandemic swept across the globe, a huge wave of online shopping created a wealth of data for marketers to leverage for future campaigns and target consumers. In light of these trends, marketers are finding it increasingly difficult to use customer data. Thus, the most impact is on analytics, because you can’t accrue and derive insights at a rapid pace to improve your ad performance.

Marketers have long been aware of the need to predict customer behavior based on aggregated information such as media exposures, store visits, social media appearances, or web visits. However, unlike before, it’s getting harder now to achieve a modest stream of data for retargeting purposes. Hence, the challenge is to find ways to grow your business or carry out your marketing campaigns using a limited amount of data.

Another aspect is that you need to protect your brand’s image, so you must keep the privacy of consumers in mind. Customers have recently demonstrated an increasing distrust for brands that use their personal information without their consent. As a marketer, you should be aware of these things and be informed of the good practices to continue achieving your marketing goals amidst these privacy rules.

Can You Still Run Ads with Data Privacy?

While you can still run campaigns without all of the available data, it’s harder for you to use data to create a personalized experience for your customers. In line with that, a Gartner report said that by 2025, 80% of marketers will leave behind their personalization efforts. Tracking sales leads used to be the goldmine, but certain aspects of the process have started to become more complex due to changing global privacy laws.

For instance, the data from Facebook and Instagram is crucial for companies to gain insights into their audience. Amongst other things, this helps them identify customer needs and subsequently create targeted campaigns. In a sense, the loss of audience data for these two platforms could cost both large and small companies a lot of money.

Furthermore, if Google implements cookieless browsing in their Chrome browser by the end of 2023, it will mean less targeted marketing campaigns and poorer ad engagement. Note that third-party web cookies are used for tracking user activity and are critical for brands to track and interact with users on the web.

With technology, it was fairly easy to create a message that appealed to specific groups of people on social media and achieve growth. Today, targeting content requires a new level of creativity. You might want to look back at the traditional ways of advertising — where you need to create content that appeals to the widest audience possible rather than narrow segments.

 

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Diving Deeper Into the Impacts of Data Privacy Issues

Faced with mounting pressure to protect their customers, more advertising networks have developed new protocols to protect consumers’ data. As a result, these have created challenges for marketers as they seek to measure and meet specific campaign objectives. Below is a detailed overview of the impact that privacy laws have on marketing mediums.

How It Affects Search Engines

Since the launch of analytics 360, marketers have been able to expand their audience targeting with the new data. However, because of the EU’s GDPR, audiences and most interest-based audiences relying on 3P cookies will be smaller — and worse, will vanish. It’s because Google will retire third party cookie-based audiences and marketers can no longer use Customer Match and Similar Audiences without getting explicit consent.

Another impact on the search engine is that Google Ads’ performance will likely decrease on iOS devices like Apple. In other words, ads will be unable to be accurately displayed on these types of screens. The platform will most likely not perform at the same level as before.

Meanwhile, the piece of good news is that Microsoft Ad’s remarketing will continue to function correctly as long as you have the latest Universal Event Tracking (UET) tag installed. Again, these are actions mainly to improve user privacy and security.

How It Affects Display & Video Ads

Programmatic advance in display advertising marketing is often based on targeting specific demographics which is done by collecting data behind users’ anonymous figures. However, with the implementation of GDPR, display ad targeting will now require publishers to gain explicit consent from site visitors. Furthermore, programmatic 3P banking on third parties will have to find new methods of gathering user behavioral data. In the same way, the new data privacy regulations will shift the Microsoft Audience Network (MSAN) and Google Display Audience (GDA) in the same way that search does.

How It Affects Ads on Social Media Platforms

A relatively recent contender in the digital marketing landscape, Facebook’s rise has been rapid and almost unimaginably successful. However, as with any platform that finds success, new privacy policies have made the giant platform upgrade its own rules to adhere to laws.

As per new privacy policies, Facebook has also announced that it is removing all 15-character identifiers for advertisers, which may cause the size of its website custom audiences, app custom audiences, and retargeting audiences to shrink. Moreover, Facebook limits ad accounts to just eight conversion events outside of page view. Advertisers may also need to accrue longer learning curves for their Facebook ads, resulting in longer optimization periods.

While other social media channels are working hard to comply with these privacy laws, Facebook, as well as Pinterest, have started investing in first-party solutions to help marketers correctly attribute ad campaigns rather than relying on web browsers’ data.

These changes would result in frustration for many, but the thing is that the vast majority of businesses won’t be affected at all. In fact, it will only impact companies that rely heavily on third-party cookies to retarget their audiences. Thus, marketers and relevant individuals need to understand the ramifications of these changes to prevent large-scale issues.

Data Privacy & You: How Can You Adapt

As privacy becomes the norm and the digital marketing world is becoming increasingly competitive, marketing professionals are already finding new ways to ensure their success. That being said, it starts with realizing that your ability to harness that big data is no longer feasible. What’s left is a competitive environment where organizations have to come up with creative strategies to compete and be compliant.

On the positive side, although the digital landscape is constantly shifting, the fundamentals of customer engagement remain the same. People still want to be engaged with brands they can trust. Rather than rely on the analytics alone for all of your marketing decisions, it’s time to dig deeper. You can find out what’s going on with your audience, and find other ways to connect with them more efficiently.

Here are some other strategies you can implement to tackle privacy issues and continue to achieve your marketing objectives:

Giving Customers Full Control of Their Data

A recent survey reported that 91% of customers would want to control their own data. As such, the GDPR data policy mandated that consumers should be given more control over their data. To stay in line with these regulations, you need to take steps to ensure that you’re only collecting data that you’re allowed to collect. If possible, equip your system with clear opt-ins and easy opt-out points — so users feel comfortable giving the data you need.

You can also make your process more effective by:

  • Have an accessible security data policy in your system.
  • Notifying your audience of the purpose of collecting their data.
  • Check your security measures regularly to ensure that all rules are met.
  • Honoring a customer’s request whether to access or not to use their data.

Quality Content for Larger Demographics

In this privacy-first world, there’s an essential need for high-quality content. You can develop impactful content by identifying and defining your brand’s values, principles, and focus, so you can determine how it should be positioned in front of your target audience. Furthermore, once you have that powerful message, use it to capture a mass audience.

Instead of focusing on smaller demographics, you need to recognize the significance of meeting the needs of many at once through comprehensive messages. Using “one size fits all” content may be easier in the short term, but it often results in missed opportunities to connect with large groups who may benefit from your products or services. By turning to the bigger picture and creating correlations between multiple profiles, you are no longer looking at individual cases, but larger audiences. As a result, you are increasing your chance of higher engagement.

Data-Driven Approach

The amount of data businesses collect daily is astounding, and most of it goes unused. Take note that keeping data you don’t use is an unnecessary liability. It’s extremely important to ensure that you don’t collect or store any data that is not required. Therefore, you must identify exactly what type of data is required, and which can be disregarded. In short, gathering only the necessary data.

Ad Adaptability

Delivering a single message has its benefits, but increasing ad and communication frequency is a more effective way to reach a mass audience. Instead of bombarding the customer with one powerful message, a more well-rounded approach is to increase ad and communication frequency. You might want to display several ads with different angles to increase interaction. If you can, connect more often to your audience to boost brand recognition. By doing this, you will have enough data to make more effective decisions.

Offering Rewards In Exchange for Data

Most customers don’t just give away information unless there is some benefit for them. By offering rewards in exchange for information then fulfilling those rewards once received, marketers will be able to build trust among consumers while also collecting valuable data for marketing objectives. However, the reward should be valuable to the customer, like a coupon or discount.

In addition, this option shouldn’t appear mandatory. You can still give your customers the option whether or not to participate in your marketing activity. For example, you can deploy a checkbox where they will be given the chance to join, or if not, skip it. In this way, you’re putting your customer in control of whether or not to share their data.

Modifying Integrated Brand Metrics

Integrated brand metrics are basically how you measure success. These metrics help you understand what’s working and what isn’t. They also help you identify trends over time, so you can adjust accordingly when needed. But, what does this mean in this era of data privacy?

When developing your integrated brand metrics, it’s critical to adjust your measurements and ensure you’re looking at campaign effectiveness on an enterprise level instead of a micro or individual level. This means tracking and measuring your ad campaigns in all aspects. For example, ad spending, customer impression, clicks, ROI, etcetera. This enables you to fully assess the performance of your campaigns and make the necessary adjustments for success.

Embrace Transparency

The GDPR requirements are clear and concise, you must take data privacy seriously by integrating compliance and transparency in your data collection techniques. To assure transparency, you should designate a part of your website where your customers can view or read your privacy policies and other guidelines.

As mentioned earlier, you can also include opt-in or out features for things like receiving newsletters. Bear in mind that failure to comply with these rules can result in fines or other penalties from regulators — as well as damage your reputation among consumers who care about privacy rights.

Think Outside the Box

Data is a powerful tool, but it’s only as good as the insights that guide strategic decisions. Combining human insight with data-based insights deepens your understanding of customers and empowers you to create meaningful marketing strategies. Also, try non-cookie-based ways to gather insights, like geo-based experiments, or use contextual tagging. You can also enhance the collection of first-party data with robust first-party tagging. Overall, it’s about being creative with your efforts while staying within legal bounds.

Be Flexible

One thing is for sure, marketing will continue to evolve, and you can’t keep up with these changes if you’re not adaptive. As we always say, “successful marketers are survivors.” They don’t only adapt; they learn and evolve to stay relevant as trends and strategies change. By understanding technology, embracing new ways to get consumer insights, and analyzing marketing opportunities across channels, you will become more successful than ever.

 

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Conclusion

An increase in the use of the internet has pushed the digital marketing industry to a new frontier. However, like it or not, consumers are getting more privacy savvy, and the new privacy laws and data collection practices are affecting even some of the world’s largest companies. Privacy laws may prevent you from obtaining some customer data without their prior consent. Make sure you comply with all your country’s regulations to successfully collect and process customer data. Despite recent changes in the advertising world, we believe that human nature and consumerism remain unchanged. The edge is that you must balance the two aspects, and you’ll gain success.

 

Sources:

https://www.forbes.com/sites/forbesbusinesscouncil/2021/05/10/marketing-in-the-new-era-of-data-privacy/?sh=6e3de28d8f66

https://www.marketingevolution.com/knowledge-center/data-privacy-issues-in-data-driven-marketing

https://rockcontent.com/blog/digital-marketing-and-privacy/

https://www.mckinsey.com/business-functions/growth-marketing-and-sales/our-insights/a-customer-centric-approach-to-marketing-in-a-privacy-first-world

https://www.adlucent.com/resources/blog/understanding-the-impact-of-privacy-on-digital-marketing/

https://www.acquia.com/blog/what-does-apples-new-ios-privacy-update-mean-marketers

https://www.digitalinformationworld.com/2020/01/how-data-privacy-is-changing-online-marketing.html

https://hbr.org/2020/08/data-privacy-rules-are-changing-how-can-marketers-keep-up

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