How GDPR Will Affect Companies That Use Data To Target Customers
Michael Komasinski, the President of EMEA for Merkle, a global data-driven performance marketing agency, was recently interviewed by ExchangeWire. In the interview he discussed the challenges of the upcoming GDPR regulations, why a customer-centric approach is key, as well as future trends we can expect to see in 2018.
We have the highlights from the interview for you here:
1. What is Profile-Based Marketing?
Profile-based marketing, or PBM, is all about utilizing customer data to personalize the digital experience and paid advertisement towards the individual. Companies today are able to use first and third-party data to create a unified identity for every user. That single identity is then able to be maintained across different channels and devices, with solutions such as identity management and DMP.
PBM makes advertising more effective as it improves targeting, and makes the customer experience much more valuable by personalizing it. This means that an individual will receive personalized advertisements on their smartphone, laptop or tablet, that is geared towards them and not someone else.
2. How will GDPR Affect Companies using Data to Target Customers?
Companies that primarily depend on third-party data, which is the data gathered from users they do not have direct relationships with, will struggle. With the GDPR, there will be more of a focus on using first-party data, which is the data gathered from a companies own customers or visitors.
Komasinski believes that, “for advertisers, it will mean fewer, but higher quality, platforms within which to run addressable campaigns”.
It will be interesting to see how many customers actually opt-out of providing data. But there may be some disapproval by the customers, once they see the results of less free content, fewer publishers, or higher subscription costs.
3. What are the Main Challenges Facing the Industry?
With the GDPR rapidly approaching, companies will need to double their efforts on building/utilizing data platforms and marketing stacks that enable them to personalize communication while simultaneously complying with privacy regulations and customer preferences.
The companies that Komasinski predicts will have an advantage, include:
- Companies that have invested in CRM programs and have a strong customer experience.
- Companies that continue to invest in data capabilities that link customer data with third-party data in order to maintain an unified digital identities across all touchpoints.
- Companies that invest in analytics to identify customer opportunities and drive personalization.
4. What are the Main Trends that will Shape the Industry in 2018?
Privacy initiatives and the customer experience are so far having the biggest impact. Komasinski is predicting it will shape everything from:
- Programmatic Advertising
- Advertising Tech
- Browser Functionality
- User Experience
- Client Data Capabilities
He continues to explain how brands will have to “think deeply about their value exchange with consumers and why anyone should want to allow a brand to have their data and receive communications”.
To learn more about GDPR and how it will affect your business, check out our information here.