Is it time to re-think Consent and Permissions Management?
• Capturing consumer’s consent and permissions when asking them to share their personal information is broken.
• Firms see consent as a cost and compliance exercise rather than an economic opportunity.
• New regulation and the growth in Smart Data sharing increases the need for us to think again about how we manage consent.
• Better consent and permissions management can be an important enabler of trust that can deliver growth and drive better, more personalised experiences for consumers.
Privacy and consent management is a topic that rarely seems to occupy the minds of Execs.
The pre-occupation of Compliance and Data Management Specialists, it only demands a Board’s attention when things go wrong, and firms are fined.
This is worrying.
GDPR fines in 2023 cost businesses $2.2bn and this figure is forecasted to rise to $2.5bn by 2025. 71% of global businesses now interact with European data which means that over 240m businesses worldwide now need to comply with GDPR regulations (source: Liminal, 2023).
So, why aren’t we all paying more attention to the problem?
It’s a cost with no return – the common misconception is that there’s no economic value in businesses investing in consent and privacy management systems. It’s a cost and compliance exercise that gets in the way of doing business and provides very little return. Its principal value is to avoid regulatory censure and protect your business reputation.
Consumers are disengaged – a third (31%) of us are unconcerned about our data privacy. A further 41% are pragmatists, happy to share data if we can see the benefits (source: DMA, 2022). The process by which consent, and permission is captured is opaque. So many of us have ‘checked-out’ of the process, over-whelmed by the complexity of Privacy Notices when sharing our personal data that we happily trade-off privacy and control in return for access.
Old infrastructure, new regulation –. More than 50% of organisations express concern about their susceptibility to fines from old infrastructure. (source: Liminal, 2023). Many are worried that their existing data collection systems simply cannot keep pace with modern privacy regulations, which makes updating them challenging and resource intensive.
Tracking consent is a growing problem –organisations site consent tracking i.e. the recording of consent as an event, as one of their biggest problems. It’s important because if the legal basis for processing data is consent a firm might often be asked to provide proof of this consent in response to a complaint. The problem is compounded for firms that operate across borders who must comply with diverse regulatory requirements. Being able to readily source, evidence and report an individual’s consent is essential to good data governance.
Why should we care about consent now. What’s the economic opportunity?
Trust = growth –79% of UK consumers claim that transparency about how their data is collected and used is important (source: DMA, 2022). In recent years, “Big Data” has acquired associations with invasive marketing, even behavioural and political manipulation. Consent is the legitimiser of all data. Once secured, it can justify any number of collection, use, and disclosure practices. Getting consent management right is a pathway to building trust with consumers, empowering them to better understand the value of their data. Apple has used this premise as a competitive differentiator to become a trusted consumer partnering in managing their personal data. More recent studies have shown that clear, transparent, explicit explanation of consent can increase the amount of data consumers are willing to share. This offers opportunities to increase personalisation, improve products and services and deliver better outcomes for consumers.
Willingness to share – Younger consumers are particularly willing to share their personal data to drive the competitiveness of smaller businesses. The role that data sharing can play in delivering growth should be a compelling reason for businesses to think again about how they present, capture and manage consent. Over half of UK consumers (52%) say they would be more likely to exchange personal data to provide a competitive advantage to smaller companies. What’s more, their agreement increases significantly to approximately 7 in 10 among consumers aged 18-44. (source: DMA, 2022)
The Smart Data revolution – the growth of Open Banking and evolution of new data sharing schemes in energy, water and pensions has revealed the limitations of current consent and permissions management, fuelling the need for a fresh approach. Organisations need to collaborate to create better consented data sharing experiences that deliver more transparency and control for consumers.
New regulation – With the government now committed to delivering the Digital Information and Smart Data Bill, a further review of consent management and permissions is likely to align Smart Data and GDPR governance. Europe is already progressing. The most recent recommendations from the European Data Protection Board (EDPB) proposes the use of Consent Management Dashboards as part of the next phase of Payments Services reforms – PSD3. If adopted it will require every participant involved in payments services in Europe to provide a consent management dashboard for consumers to interact with and manage their consents.
Remove cost and inefficiency - Customer’s engage and share their consent with different teams from the same organisation. This is often stored in multiple databases with different permissions. Firms struggle to provide a single-customer view of these consents to capitalise on the full understanding of their customer’s loyalty and value. Customer communication is frequent, inefficient and confused. This undermines brand perception and consumer confidence.
What do you need to do?
Build trust – firms need to reset their thinking on how more transparent and controlled consented data sharing can be used to build trust and deliver economic value by enabling greater personalisation and wider use of data. Evidence suggests that those firms who double-down and provide better customer-centric solutions that build trust amongst consumers, will be the ones who realise the economic value of meaningful consent.
Consolidate – to truly unlock the value of your data and understand the extent of consumer permissions you need to consolidate your understanding of their consent into a single-customer view. Presenting this in an intuitive, user-friendly dashboard provides greater transparency across your internal teams and improves data governance. Using consent dashboards externally with consumers empowers them to understand who they have shared their data with, when and for what purpose. Forthcoming legislation suggest that Consent Dashboards will become a fundamental requirement for compliant data governance, so taking time to invest now, is likely to be money well-spent.
Collaborate – the advent of new Smart Data sharing schemes such as Open Finance and Open Energy provides an opportunity to deliver innovation. Where multiple parties are involved in capturing consent and permissions, consumers will want to know who has their data and what is it being used for? Firms operating in Smart Data sharing schemes will need to take responsibility themselves for capturing consumer consent and permissions without relying on a central authority to do this. Collaborating with others to create a common governance and data sharing best practice will drive innovation.
Rob Haslingden is an independent Propositions and Product Marketing specialist and Open Data consultant.
