The impact of GDPR on marketing15 Jun, 20175 mins
It is just under a year until the new EU General Data Protection Regulations come into force...
It is just under a year until the new EU General Data Protection Regulations come into force- how prepared are agencies for this change in regulation?
According to a survey from the Direct Marketing Association (DMA) released on the 25th of May a quarter of companies (24%) have yet to even start a GDPR plan while little over half surveyed believed their organisations will be ready for the 2018 deadline.
This lack of preparation could lead to companies suffering heavy penalties for misuse of customer data. Huge fines of €20m, or up to 4% of global revenues, have been threatened for non-compliance. To give an example, if Tesco – which last year suffered a data breach affecting 40,000 customers – were to have been hit with the maximum penalty, it would have been out of pocket to the tune of £14.9m.
So why are companies so unprepared for regulations that could have an enormous a monetary impact on them? According to an earlier survey from YouGov and the Chartered Institute of Marketing (conducted last year), 16% of marketers don’t think GDPR is relevant to their business, and 9% said it had been mentioned in their offices but nothing had been formally discussed.
Have UK marketers under-estimated the impact of EU privacy laws?
According to a study only 6% of UK marketers feel they fully grasp what forthcoming EU-wide privacy rules will mean for their business with just over one-third of those surveyed admitting they don’t know whether their company has taken any steps to ensure they are compliant.
In addition to companies not fully grasping the full impact of the GDPR, it seems they are also unprepared to detect any breaches in data- in a survey of 187 marketing and advertising companies conducted by YouGov on behalf of law firm Irwin Mitchel, 70% said they wouldn't be certain of their ability to detect a data breach. The Chartered Institute of Marketing (CIM) indicates only 11% of marketers already have systems in place to ensure they don’t fall foul of the legislation.
What will be the impact of GDPR?
What are the concerns surrounding the lack of preparation for GDPR and how will this affect our companies and the economy? According to a study almost a fifth of companies in the marketing and advertising sector would go out of business if they were to be hit by a fine for non-compliance of the new GDPR legislation. Additionally marketers risk their reputation in a world where consumers are becoming more and more aware of the risks that come with growing access to data and want to ensure companies understand and mitigate those risks.
To conclude- with just under a year until the GDPR comes into practice companies are concerningly under prepared to avoid breaches in data. It seems companies have under-estimated the impact the GDPR could have and don’t seem to think it’s relevant for their business. However, if businesses fail to prepare for these changes in regulations they will be hit with heavy fines and could go out of business. It is essential that we start taking GDPR more seriously so that marketers can safeguard not only their reputation but also their finances.