Important changes are set to come into effect with regard to marketing legislation (Elanders has a great take here). During an event held on April 15th 2013, Caroline Roberts, the Director of Public Affairs of the Direct Marketing Association discussed the proposed amendments to the Data Protection Act of 1998.
These new proposals are likely to have a huge effect on the direct marketing sector, in whatever form they are passed. The changes to the Data Protection Act 1998 are not likely to come into effect until 2015/16, and there are a number of reasons for the update.
Emerging technologies in marketing have resulted in networks of information becoming more complex. In an increasingly online world, a lack of common European law on the subject means that there are difficulties in implementation. There is also some consumer concern about direct marketing policies, and data protection is now a right for all as stated in the EU Charter of Fundamental Rights. So what exactly are the proposed changes, and what do they mean?
Under the new law, the definitions of “data subject” and “personal data” are to be expanded in order to include some (but not all) cookies and IP addresses. As a result of this, digital marketers will find profiling and web analytics to be a much more difficult task, as data which was once easily accessible will now be protected. Marketers will now require explicit consent in order to use customer data.
All subjects will have the right to be “forgotten”. This means that anyone who wishes to do so may have their data removed from a list indefinitely. Marketers who continue to use such data may be liable for prosecution.
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There will also be a greater emphasis on accountability. Any breaches of data security must be notified to the ICO as well as any concerned individuals within 24 hours, and there will be greater penalties for data breaches. Data subjects will also be entitled to request any information pertaining to them for free, as opposed to having to pay the current £10 fee.
All of these changes are likely to have an effect on direct marketing in a number of different ways. The new legislation could lead to a ban on profiling, meaning that targeted messages will be replaced with more generic ones. List trading and lead generation will also be banned, stopping businesses from selling their data sets to one another. Direct marketers will also have to take into account the rights of their data subjects, with regard to the “right to be forgotten”. It is estimated that the financial impact on British businesses could run in excess of £47 billion in lost sales. The cost to individual businesses in order to comply with the new regulations is an estimated £76,000 apiece.
The Direct Marketing Association have reviewed the new measures and will lobby to contest some of the proposals, with an argument that a fair balance between proactive and legitimate interests should be met, and that the proposals in their current form will be harmful for business, and will only serve to stifle innovation and place obstacles in the way of growth.