The landscape of digital advertising in Europe could be undergoing a monumental shift. Recent developments have put the spotlight on the legal frameworks governing behavioral advertising, where personal data plays a crucial role. Businesses now face a critical turning point: to adapt to the changing norms around the application of consent under the General Data Protection Regulation (GDPR) or to endure severe penalties. In this blog, we'll dissect the intricacies of these new enforcement activities, the implications for consent-based advertising, and strategies for compliance.
The end of "contract" and "legitimate interest"?
The GDPR initially provided several legal bases for processing personal data, two of which — 'contract' and 'legitimate interest' — have been leveraged for behavioral advertising by large corporations. However, a recent binding decision by the European Data Protection Board (EDPB) could change the game. It’s possible that once relied-upon legal bases are no longer deemed suitable for the processing of personal data in the context of behavioral advertising. This indicates a significant policy shift and underlines the necessity for businesses to reassess their data processing foundations.
The illusion of consent via paid models
Even more pressing is the scrutiny over the practice of consent collection. A rising trend among some digital platforms is the introduction of a paid model that ostensibly provides users with the choice to opt out of behavioral advertising. However, this model may be problematic as it suggests that consent can be bypassed through financial means, which poses a question on the genuineness of the choice provided to the users. Consent, as defined by the GDPR, needs to be freely given, specific, informed, and unambiguous. A 'pay to opt-out' model inherently conflicts with the essence of what constitutes true consent. It implies that only those who can pay will then receive true privacy, which raises the question – is this consent freely given?
Reevaluating consent strategies
With recent regulatory decisions, it is imperative for businesses to reevaluate how they collect and use data for advertising purposes. The old models of assuming consent based on user agreements or the vague notion of 'legitimate interest' are no longer viable. Companies need to establish clear, transparent, and voluntary consent mechanisms. This means providing users with straightforward information about what their data will be used for and giving them a genuine choice without repercussions on the usability of the service should they opt-out.
The cost of non-compliance
Businesses that fail to adapt to these changes risk substantial fines — up to 4% of their global turnover. This is not just a theoretical risk; enforcement actions have already begun, with fines being levied in cases where companies have failed to comply with privacy regulations. The message from regulators is clear: the privacy of users is not up for sale, and consent must be a reflection of users' actual choices.
Developing clear and compliant consent mechanisms
In light of the recent developments, businesses must have consent mechanisms in place that are in full compliance with the GDPR. This entails creating consent forms that are easy to understand and don't overwhelm the user with legal jargon. It also means ensuring that consent is not bundled as a condition of service and that users can give or withhold consent without negative consequences.
The role of transparency and control
Transparency is at the heart of GDPR-compliant consent. Users should have control over their personal data, with the ability to easily review and change their consent choices. Businesses must also be transparent about how user data is processed and for what purposes. Regular audits and updates to consent practices will help maintain compliance and trust with users.
Embracing ethical advertising practices
Businesses are encouraged to look towards ethical advertising practices that respect user privacy. Contextual advertising, which does not rely on personal data, presents an alternative that can be equally effective. Companies should invest in technologies and methods that support privacy by design and default, thus aligning their practices with regulatory expectations and user preferences.
The GDPR has initiated a tidal wave of changes in the digital advertising space, emphasizing the significance of true user consent. Companies must now navigate these complex waters with a clear understanding of the rules and a commitment to ethical practices. The challenge is considerable, but so is the opportunity to build trust and demonstrate respect for user privacy in the digital age.
Embracing these changes is not just about compliance; it’s about leading the way in a market that values transparency and user empowerment.
With OneTrust Consent & Preferences, get your digital properties compliant with applicable privacy regulations across the world. With digital tracking governance, you can identify all cookies and tracking technologies on your websites, mobile apps, and even connected TV apps. Use customized templates to provide a brand-first, user-friendly, and transparent consent experience to your users that gives them the control to decide how and why their data is processed.
After website users define their consent and their communication preferences, how can you ensure that their choices are actually reflected in your actions? Real-time syncing throughout your marketing tech stack ensures that user decisions regarding consent and preferences are honored across all your organization’s systems for a seamless, privacy-first experience.
Learn more about how OneTrust Consent & Preferences can help your organization today.