Unless you have been living under a rock, you know at least the very basics about GDPR (General Data Protection Regulation). However, if you have entirely no clue what we are referring too, let’s break down what GDPR is. In its essence, GDPR refers to a set of rules and guidelines created to give citizens of the European Union control over their personal and identifiable data across the web. It was designed with the intentions to simplify the way data is submitted, processed, and shared between businesses and their user base.
Although parliament approved the regulation on April 14, 2016, businesses were given two years to meet “compliance.” So, in essence, the law affects everywhere because with many companies now thriving more and more in the digital space, anyone is susceptible to having website visitors – for example – from the EU. In other words, even if you are a small business owner in Texas, as long as you sell goods or services online and ship or accept clients/customers from any of the EU regulated countries, then you must be under compliance.
Why GDPR Matters
We believe, firmly, that these regulatory changes will bring positive changes to the digital space. While many small business owners may feel different due to the amount of work it takes to become compliant – mainly when you have been collecting data for your business for years. However, the impact that GDPR will have in the digital/online markets will maintain for months and even years to come. One of the aspects that we wanted to explore was the financial one because also if you are not an online retailer, there is going to be a significant period of transition for your business.
The Trust Factor
The primary reason why GDPR came to pass was due to the continues mistrust that consumers had with the use of their data and how businesses share this data across various third-party vendors. Let’s face it; personal data has become the most critical piece of content for any company. It is the force that allows applications and systems to mold the customer experience and generate strategies. When a brand knows very little about the users it actively markets too, it becomes that must harder for the company to grow, scale, and even innovate.
However, there has to be a line, and consumers have officially drawn it. Companies will no longer have the option to be vague about the way market their products. It has now become evident that what consumers want more than ever is authenticity and trust from the brands they know and love. Without it, a company can face a real risk as it will no longer be able to achieve goals, and without these innovations – as previously mentioned – will stunt any growth.
The Credibility Factor
When you are conducting business online (or even offline for that matter) it becomes increasingly important to be credible. What is found on the web often remains there for years to come and companies have to become aware of the ramifications that can arise from not being socially responsible with user data. Whether or not you operate a business within the EU, the concept of providing transparency to users regarding their data can do wonders for your bottom line.
Recent incidents of data breaches across the US alone, have given users a bad taste by some of the most trusted brands in the country. GDPR has provided small businesses an opportunity to shine. In some cases, it has allowed small businesses to outperform more prominent brands because they have smaller assets to protect and newer sets of user data to manage.
The Financial Factor
For a small brick and mortar company, complying with the new GDPR can mean a trip to your legal counsel’s office for a brief rundown on this new law. For a much larger organization, GDPR equals a mid-size legal team working closely with a marketing/sales and accounts management department to maintain full compliance across the board. In other words, this will have a significant financial impact on any organization. The return, however, is one of the main reasons why you should consider compliance even if you are not a citizen of the EU.
Many believe that the financial ramifications occur when a company is going into compliance, but that is not the case. The real economic consequences happen when consumers begin to lose trust in the services and products that you offer. After all, people buy from those they trust, which is why GDPR can be used to enable business rather than hindering it.
Overall Company Culture
As we continue to move into an era where consumers will have more and more power over their name and data, it is up to brands and companies to create a culture focused on the consumer first. Being accountable as an organization for the data that we store on behalf of our customers will be the difference between trust and discredit.