Businesses face many challenges, and one such challenge is perhaps adhering to policy changes. In once such recent development with Digital Personal Data Protection Bill being cleared by the Parliament is expected to have a looming impact on the martech industry. From creating system for data based targeted communication to seeking user ‘consent’ at every steop of the way, these are some of the key changes that bussinesses will have to understake. According to industry estimates the immediate impact is that the capital expenditure of companies would increase by five percent in the next six months to one year. “These companies would create the entire martech stack in the next year, which will give them the advantage of creating cohort based targeted communication,” Sanjay Trehan, digital and new media advisor told BrandWagon Online.
Why Data?
The bill introduces the concept of ‘data fiduciaries,’ encompassing both public and private entities responsible for the collection and processing of personal data. These entities are mandated to adhere to regulations governing data collection, processing, and storage. Consequently, every data-centric enterprise will need to revise and fortify their data privacy policies. To ensure compliance with these new standards, companies will have take several steps. These include conducting comprehensive data audits, implementing robust encryption and cybersecurity measures, seeking legal counsel to navigate the intricacies of the bill, and educating their workforce about the updated data protection protocols. “For martech companies, the initial step entails a comprehensive review and updating of its customer intelligence policies. From an employee perspective, raising awareness about new amendments and refining processes such as data mapping, consent management, and vendor agreements holds utmost significance,” Kalpit Jain, Group CEO, Netcore Cloud, explained.
In in a nut-shell marketers will also have to move to data-driven programmatic media channels such as connected TV, programmatic audio, and in-app mobile targeting. “Affinity targeting is an alternative to demographic targeting that targets users based on their passions, habits, and interests. By targeting users based on interests, affinity audiences include users across demographics, making it more inclusive than demographic targeting,” Siddharth Dabhade, global commercial board member and managing director, MiQ, said.
Not too personal!
While personalisation has long been a foundational element of modern marketing, the risk resides in being a bit too personal. And this is where the DPDP bill is expected to play a crucial role. There has been a long debate on who owns the customer. The answer is fairly simple now, the customer herself, as companies now have been forced to seek consent or take an opt-in before any communication is fired. Moreover, the customer can opt-out at any given time, in certain scenarios. “It is necessary to find a way to balance privacy with personalisation, which has long been the focus of contemporary marketing. Marketing professionals must use creativity to create personalised experiences without compromising user privacy. This necessitates using anonymised data, offering apparent opt-in mechanisms, and emphasising user control. Instead of focusing on specific user data, it will be essential to use AI and machine learning for pattern recognition, along with transparent communication and strict security measures,”,” Ankit Sinha, co-founder and CTO, Tagbin explained.
What this also means, that the bill mandates that marketers who have been using Personal Identifiable Information (PII) data (email, phone number and others) so far in their campaigns will also have to seek consent explicitly from their customers or look at other targeting options like authenticated IDs, contextual targeting, and geo/location-based targeting.
The impact
From what it is understood that large companies in the last few years have invested to tranform digitally, while some of are still under-going the process. However, many other start-ups and direct-to-consumer (D2C) companies are yet to make that transition or will start now. According to Aakash Anand, Founder and CEO, IDAM House of Brands, the bill may impact D2C brands in terms of online sales, digital marketing efforts and costs. “Brands may see a decrease in online sales in the short term as brands will need to make changes to their data collection and processing practices in order to comply with the new law. This may lead to some customers being less likely to share their personal data with brands, which could impact sales. This could lead to increased costs for brands, which could also impact sales,” he added.
Experts further opine that brands may need to hire new staffers with expertise in data protection, thereby increasing the employee benefit costs.
Furthermore, it is believed that the bill will also have a notable impact on international companies aiming to engage with Indian consumers. As per the mandate international brands need to develop an India-focused data strategy using first-party data, prioritise user consent, and localise marketing approach. “It mandates sensitive data storage in India, impacting global companies’ practices. Marketers must review data collection, grant data access and deletion rights to users, and ensure compliance, fostering a privacy-centric and transparent marketing approach in India”, Rajat Abbi, VP- global marketing and chief marketing officer, Greater India, Schneider Electric, said.