Impact of GDPR so far: What happens next?
Since its implementation on May 25th 2018, GDPR has been a trending topic. Now that a few months have passed, it´s time to take a look and at the impact of GDPR so far and what happens next.
There have been a multitude of changes in companies´ business models and both positive and negative effects of GDPR. Many companies are now choosing to encrypt data through SaaS solutions like Recordia, which allows you to capture,record, encrypt and store all interactions or eComFax, which allows you to sendand encrypts faxes from multiple devices, without any fax machines and through a secure network in the cloud.
So far, we have seen few fines. Firstly, Austria´s DPA fined a retailer €4,800 for illegal video surveillance. A German social media company was fined €20,000 for a data breach, which resulted in the leak of 330,000 user emails and passwords. A Portuguese hospital fines totaled €400,000, for two data breaches, which compromised patient confidentiality. Over the next 6 months it´s very likely that the volume of fines will increase.
Venture investments and advertising
GDPR has effected a variety of business activities such as venture investments and online advertising. There has reportedly been a 17.6 % decline in the number of venture deals weekly. However, this can´t all be put down to GDPR. Despite this decline in investments, share capital received by software companies is higher than ever before. This is still the very early stages of GDPR and it will take time for its effectiveness to solidify and to know exactly what it effects and how.
With regards to online advertising, they have become more content based and thus more relevant leading to better user experience and customer satisfaction.
Data subject rights request form
In compliance with GDPR companies must provide certain minimum information to data subjects, regarding the data and processing of their personal data. This information must be concise, transparent, intelligible and in easily accessible form, using clear and plain language. These data subjects may request a copy of their data that’s being processed.
There are many positive impacts if you do this. Transparency is key. If a company doesn’tmanage their clients’ privacy correctly and successfully, their digital transformation and their operations as a whole are at risk. Privacy leads to trust, and trust is power. Without this trust,you are setting yourself up for failure. By making information easily accessible and outlining the benefits of having it to users, you are more likely to gain their trust and keep their loyalty.
Effects of GDPR outside of EU
GDPR´s effects have extended outside the EU. GDPR has resulted in many smaller companies from the US etc. stopping their ad campaigns or access to their website completely as they haven’t or can’t comply yet. This is negative for both companies and users. Due to this, tech giants like Google and Facebook, have increased their market share, the opposite of what GDPR set out to do.
Benefits of GDPR
While it´s easy to focus on the negatives there are actually many benefits of GDPR for your business.
1. Enhance data security
No company can afford to risk cybersecurity. It’snecessary to reevaluate and improve your overall cybersecurity strategy:establish thorough control over the entire IT infrastructure, build healthier data protection workflows and streamline security monitoring. These will reduce the attack surface, help you understand what is going on across your network and decrease the likelihood of having to pay a large fine.
2. Improve data management
A good first step is to audit all the data you have: identify the type of data, where it comes from and what is done with it. This will help minimize what you collect, organize and store it more efficiently. Then you can change and refine your data strategy. Get rid of data that doesn’t benefit your business or customer experience. Why take unnecessary risks and responsibilities by keeping sensitive data that you don’t need and has no benefits.
3. Increase marketing ROI
By creating content-based ads, you are targeting those who are looking for your product or service in that moment. Better data and ad content will create better user experiences. By focusing on customers who want to engage in your marketing, you will see increased open rates, click through rates, etc.
4. Increase loyalty and trust
GDPR is an opportunity to engage with customers and build loyalty. Consumers are becoming more suspicious about how their data is handled; by adhering to regulations and being transparent about what data collected and how it will benefit your customers, you are more likely to earn and keep their trust and loyalty. Forrester’s 2019 customer experience index showed that the connection between consumers and brands is decreasing for the 3rd year in arow. Companies need to take action to change this trend.
5. Become a leading force in changing business culture
GDPR is an opportunity for a company to excel. It’s the first step towards a new business culture. This can become the norm, just like being ecofriendly and animal-friendly has over the last 10-15 years. By adhering to GDPR, you can create a business culture and mindset that respects and is responsible with personal data. Data and analytics leaders should increase awareness of how business outcomes can improve by changing how their organization handles personal data.
What should your company do?
It´s essential that companies take initiative and are proactive in their approach to GDPR. It’s very likely that there will be an increase of fines as time goes on. So, if you haven’t taken steps to make your business compliant yet, now’s the time to do it. This is especially important for SMB´s, as fines will hurt them much more than corporations, not only in monetary value but also with their image and reputation. Bad publicity for small companies or startups can be detrimental.
Our software solutions Recordia and eComFax, are GDPR compliant and can help you collect, protect and securely store data collected through landline, mobile, email, SMS or fax and is easy to retrieve and analyze.