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Marketers Don’t Talk About Data Privacy, But They Should

OMI Forbes Article | Date: 2023-04-28

Paula Chiocchi is CEO of Outward Media, Inc., a provider of 80MM B2B contacts including email and digital IDs that drive business growth.

Data privacy has become a difficult, even awkward, topic for marketers. As the general population has become increasingly aware of data privacy and as new regulations come into play, the spotlight is on how advertisers use personal data—and how it’s collected in the first place. As a longtime marketing data provider, I believe we’re at a crossroads. ??This isn’t a topic we can afford to avoid, and not addressing it is a decision on its own.

The Data Privacy Catch-22

Data privacy concerns are changing the face of marketing—how we reach prospects, measure responses and continue to engage them. Third-party tracking cookies have come under fire for invading users’ privacy, and new privacy laws are regulating how data can be collected, stipulating the explicit permissions organizations must obtain to collect it.

In the Third Edition Salesforce Marketing Intelligence Report, 90% of marketers indicated recent data privacy changes have shifted their KPIs and how they measure performance, with 64% saying they’ve changed how they collect customer data. Despite that, only 36% of B2B brands say they are ready for upcoming data privacy changes, according to another study.

Even as web browsers have delayed the removal of tracking cookies, and even though there are potential changes to GDPR in the U.K. in play, privacy continues to be a topic of discussion and concern. Our world has shifted to greater awareness of privacy and more demand for explicit consent to use personal data. Yet, marketers need consumer data. Digital campaigns rely on data for everything—from creating content to reaching the right prospective buyers across the many channels they frequent. And not just any data will do—marketers need robust, high-quality data. Campaigns using poor-quality data will almost certainly have poor results.

Additionally, inaccurate data can sabotage personalization efforts. According to results from an Ascend2 survey conducted in partnership with my company, Outward Media, Inc., 54% of respondents said personalization that goes beyond the first and last name is a priority for email marketing in the year ahead. With bad data, instead of showing your prospects how much you know them and understand their needs, you’ll end up with the opposite effect. From the consumer perspective, bad data also opens the floodgates to (even more) irrelevant marketing—and worse, it can be seen as an invasion of privacy.

It all leads to the question: Can data privacy and quality third-party marketing data coexist? In my experience, the answer is yes—because there are data solutions that balance both consumers’ and marketers’ needs with high-quality data that follows privacy guidelines.

The Intersection Of Data Quality And Data Privacy

With the impending removal of support for cookies, many marketers are turning to new methods to reach their desired audiences. Some voices in the industry have pointed to first-party data as a solution to replace cookies, and while, when gathered correctly, it avoids privacy issues, the fact is most organizations don’t have the database reach necessary to fuel effective campaigns. The alternative is third-party data that maintains privacy.

Opted-In Data

Whether you realize it or not, your personal data is used and stored in many ways by a variety of sources—from medical and education records to your HOA and volunteer organizations. The real issue with privacy isn’t that data is used but when it’s used without permission. Therefore, the key to privacy with third-party data is permission. Opted-in data means the user specifically opted-in to share their personal data. It adheres to privacy guidelines because the individual has given permission for it to be collected and shared.

Anonymized Data

People-based identity solutions have also risen in use and prominence as an alternative to cookies. Identity graphs offer a creative and privacy-friendly approach to data that can fuel effective omnichannel campaigns. Data is sourced from multiple high-quality providers and includes online and offline details for a full picture of the customer. Marketers can build highly customized audiences in the identity graph, but the actual data is anonymized to maintain privacy. From there, the anonymized IDs are taken from the graph to a demand-side platform to execute the campaign. Marketers can better reach the right prospects for their offers while maintaining consumer privacy.

Selecting A Third-Party Data Vendor

Finding the sweet spot for third-party data requires due diligence, but data quality and data privacy don’t need to be mutually exclusive. The number of data vendors has increased dramatically in recent years, with varying standards when it comes to data quality and privacy adherence. Before selecting a data provider, consider these questions:

• How is the data collected? If data is scraped using website monitoring technology, it could violate CAN-SPAM and CCPA (California Consumer Privacy Act).

• Is it opted-in data? If not, the user did not give permission for their data to be shared in the first place.

• Is the data regularly updated? Does the provider offer data cleansing services to amend first-party data?

• What is the data quality guarantee? For reference, 95% email address validity for the first 30 days is a good guideline to gauge against.

• Are email delivery receipts available? This provides reassurance that the quality is high and actually reaches the intended recipient.

The data privacy landscape has changed dramatically in recent years. Yes, there are many changes for marketers, but it’s also something that remains top of mind for buyers. Every time they opt-in to accept cookies when they visit a new website, they’re reminded that their data is being used. Privacy doesn’t need to be the elephant in the room that marketers don’t want to discuss. We need to start talking about it—and about the solutions that meet today’s business needs while maintaining consumer privacy standards.

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Paula Chiocchi

Paula Chiocchi is CEO of Outward Media, Inc., a provider of 117MM B2B contacts including email and digital IDs that drive business growth. Read Paula Chiocchi's full executive profile here.

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