Digital consumers are asking for more control of their data and more support from their governments to secure and protect their privacy. The European Community with GDPR and the state of California in the USA with CPRA define the standards where the digital consumer (“the data subject”) provides consent to save and use data from interaction with advertising and websites.
In the case of Costa Rica, the Law 8968 Protection of the Person with regard to the processing of personal data on November 5th 2011 and Regulations of the law of the Protection of the Person with regard to the Processing of Personal Data, which came into effect on December 6th, 2016 are in place to regulate the use of information and user data. With this law, Costa Rica relies on a framework similar to those above where “It corresponds to the responsible person or the one in charge of the dissemination, commercialization and the distribution of said data, to determine informed consent given by the owner, if and when this data will be saved or housed by an intermediary technology.” Therefore, to capture the user or client data and have consent, it is necessary to make sure that the consent corresponds to the use that is going to be given to the data.
This means that although our businesses advertise in marketing platforms, like Google Ads, Facebook Ads and Amazon Ads, and publish content in social media such as Instagram and Google My Business, the data from our user interaction and the identities that exchange between the platforms cannot be transferred to other locations – to third parties – without the consumer’s consent. This inhibits the platforms which report to the businesses that pay and publish on these platforms, as a consequence, they will see the scope and level of detail that the businesses are accustomed to having being affected.
Businesses have enjoyed the data provided by their platforms for a long time. This data is used to provide information on the results obtained from the advertising, the scope of the content and to make decisions on marketing activities and provide better client experiences.
-Which other changes (that the firms are implementing in response to the demands for privacy from consumers and regulators) could affect digital advertising (in search engines and social media)?
“The whole digital marketing ecosystem is itself moving, the rules of business are changing and this means that the big players in the market have to adapt their platforms to ensure that they are complying with the new rules and policies. Advisory firms and digital agencies have to adjust their services and the advertisers need to inform and declare on their digital platforms how they use client date; they need to ask for consent to use the data, and the clients need to choose – to share or not to share – and probably ask; What do I receive in return for sharing my data? The advertisers need to define what will change which has real value.” (Angie Jiménez)
In September 2020, Apple continued widening restrictions for the tracking of users through Safari with a new version 2.3 of “Intelligent Tracking Prevention – ITP” that impedes tracking users on different websites. Apple has restricted the use of “cookies” to save data on client interaction since April 2020 with the 2.2 version of ITP.
As an answer to the European and Californian regulation, and in response to Apple’s restrictions, the digital advertising industry proposed a new standard to capture data on consumer interaction called “Transparency and Consent Framework (TCF)” to respond to the European authorities, through the standards institute “Internet Advertising Bureau – IAB”. However, in October 2020, the European Community determined that the TCF was not sufficient to comply with the European privacy regulations (GDPR).
In 2020, Google launched a new version of “Google Analytics” and also a new data gathering tool within “Tag Manager” called “server-side tagging”, with the objective of facilitating and complying with data capture standards. Facebook is working with a version of Facebook Pixel to achieve the same effect. In both cases, the data capture is carried out by a business on the server (“server-side”) and with the consent of their users. (“first party”).
To enable marketing services, Google will transfer more control and management of data to the navigator (“Chrome” in the case of Google) so that the processing of client data for marketing ends occurs in the user’s own browser.
-What could be the impact of these changes on the management of advertising on social media and navigators?
The impact is that the businesses that want to capture and use data on the interaction and identity of the users on their sites and digital apps, CANNOT handover this management to the platforms like before.
Digital marketing platforms like Google, Facebook and Amazon will be more limited in their ability to inform our businesses on campaign results. Data (known as “third-party”) that these platforms can provide to our businesses will be of lower quality and of less value for those who advertise on these platforms. The best evidence of this is in what we have in the current Google Analytics reports; for example: we are starting to see many reports with a high volume of “not set” that do not allow the analysis of information and user interaction with the website.
The decision for our businesses to continue receiving consumer data implies:
- Accepting that data management has to mature.
- Asking for consent from the consumers, inform them that data will be captured, why and that they are ready to make changes.
- Applying data gathering methods that ensure that the information will not be safeguarded by Google or Facebook, but for their own business (known as “first party”). As businesses, we not cannot pass responsibility for the privacy of our consumers to third parties.
- Creating our own digital marketing “data warehouse” to gather and protect the privacy of the consumers, comply with all the security requirements.
- Focusing on generating value, in a manner that the consumer will give change to their consent permanently. This implies starting to integrate-migrate different platforms where consumer data is currently held. (ERP or CRM, for example)
How must we prepare the agencies that provide advisory and management services for digital campaigns before these changes?
The agencies will see the reality which has always been there with more clarity: digital marketing is more, much more than just campaigns to acquire space which takes a lot of attention (and resources) for the businesses. Digital marketing is everything that concerns the creation of conditions for the existence of an exchange of value between the business and the market.
Advertising guidelines is the area for the focus of much effort in the market, the agencies need to give a lot of attention to the whole client lifecycle to maximize the value and life of the relationship.
How must we prepare the businesses that use digital campaigns to reach out to their clients before these changes?
It is about an important change. In this case, we invest into the relationship between the digital platforms and the businesses. The change puts the business in the center of its own digital ecosystem: now it will not only be users that are dependent on the platforms. The change will demand new competencies from the businesses to capture and use data. The marketing teams will have more professional engineering, technology and statistics.
But more than anything, it implies a change of understanding on the part of the businesses, to take control of client data management and to take into account that they need to manage the consent of their clients as a new environment that can give structure to a relationship between business and client. “When businesses generate enough value for their clients to change consent to capture data of their interactions, then the businesses start to build lasting relationships based on the exchange of real value.” (Paul Fervoy)
Businesses have much to benefit from the change to a digital ecosystem that is operated by the governance of client data privacy. To take this governance seriously is to open a world of opportunity to charm and delight their clients.
