The American marketing industry is under-playing the big effects of looming European data legislation, which will slow down data targeting innovation by up to two years – that’s according to one ad-tech company chief who is sounding a warning to the industry.
The European Commission’s new General Data Protection Regulation (GDPR) came in to effect back in 2016, updating prior consumer data protection rules in a significant way. Now the final deadline for compliance is coming on May 25, and Mike Baker, dataxu CEO, thinks peers are not up to speed.
“I think GDPR is a big deal, and I think, if anything, the American marketing/advertising technology in media industry is a little bit underestimating what it represents,” Baker tells Beet.TV in this video interview.
“What’s likely to happen is a period of confusion and actually a slowdown, I think, probably, in more data-driven, targeted approaches, and it’ll realistically take, I mean, by my estimates, 12 to 24 months to get the business clarity you need to really ramp back up on the track you were headed.”
GDPR gives consumers significant new rights to limit the harvesting and processing of their personal data, with new demands including:
- tighter consent conditions for the collection of citizens’ data.
- consumers can instruct companies to stop processing their data.
- automated decision-making and profiling decisions must be made clear.
- consumers can request decisioning by automated processes be stopped and handled by a human instead.
- they have the right to request an explanation of automated decision-making.
- they can request free access, rectification and deletion of data.
Breaching the new rules risks incurring a fine of up to 4% of global annual turnover, up to a maximum of €20 million.
Switched-on companies have spent the last couple of years auditing their exposure, adding required data handling managers and getting compliant. But many are now scrambling to meet the deadline, whilst, with a few months to go and GDPR gaining headlines, others are currently in a big public push to profess their own compliance.
Baker isn’t fazed, but he is predicting a return to “old school” methods of advertising, at least for a while.
“Business will sort it out, but it’ll take a little bit of time because business doesn’t like uncertainty,” he adds. “Another prediction I’ll make for GDPR is, I think we’ll have a little bit of a return to contextual targeting for a while.
“Using our platform, for instance, you can just go on keywords in the content … I mean, this is, ‘I’m going to define an audience by the kind of content they consume.”