Since the General Data Protection Regulation (GDPR) was enforced on May 25, 2018, many have complied with it lest they face unprecedented non-compliance fines and other consequences. GDPR, at its core, is the new set of rules designed for EU individuals to give them more control over their data. Its objective is to make the regulatory environment simple so that both businesses and their customers in the EU can ultimately benefit from the digital economy.
In this article, we’ll be tackling the top industries affected by GDPR, the challenges that they face since the regulation has come into effect over a year ago, and the benefits they receive from this data privacy law. These industries are the following: social media, online retail, digital banking, cloud computing, and healthcare.
GDPR and Social Media
Last year, social media users may have noticed the changes in the privacy policies of their favorite social media websites and applications through numerous emails. The main reason behind all these changes is that the GDPR. Data breach keeps happening, such as the Facebook Cambridge Analytica Scandal, which allowed third-party applications to access personal data of over 145 million users. This is where GDPR comes in.
Social media marketing is one of the industries affected by GDPR. This means that social media marketers should fully disclose and make it clear to the users how their data are being used and gathered. They also need to receive full consent from these users to utilize that data. There are also strict requirements that the GDPR gives to social media companies. These requirements surely affected the normal operations of these businesses and posed as challenges. Some of these strict rules are as follows:
- Users now have the “right to be forgotten.” That means users have the right to ask to erase all their data.
- Social media companies should inform their users within 72 hours after a data or security breach is detected.
- In all privacy policies and explanations regarding users’ data, plain language should be used. That means that social media marketers must no longer use technical and legal jargon.
For information related to sexual orientation, race, health, political, and religious beliefs, special safeguards must be put in place.
Another new right for users is to ask to be opted out of targeted advertising using their data.
Despite the effect of GDPR on social media marketers, this regulation is beneficial to their consumers. GDPR means more privacy for social media users. Since social media companies need to have full consent from their users to collect data, users can choose not to share some of their sensitive information if they want to. The activation of GDPR also means more protection for the consumers. Fewer data breaches are expected because the regulation has stricter supervision of data processing and collection.
GDPR and Online Retail
Although GDPR has not put a stop to targeted marketing, it has challenged the online retail companies to make some changes and compels digital brands to rethink their marketing strategies. Because of the restrictions imposed by GDPR such as the limitations around the use of third-party information, it has become an obstacle for online retailers to thrive in a landscape where more significant constraints are visible.
Although the tight limitation on the use of third-party data has become a challenge, making this a pivot toward first-party data will give online retailers advantages and put them on better standing. Customer data use plays a vital role in the growth of any business. Some of the popular online retailers have used first-party data to build and rebuild their brands. It is essential to put in mind that GDPR’s customer-centric policies will benefit online retailers in building a reliable relationship with their customers.
GDPR also provides advantages to the consumer of online retailers. They will have the right to be treated as individuals and not just sales. This can be reinforced by GDPR through compelling online retailers to strategically use first-party information to provide one-on-one interactions with their customers. This will, in turn, bring value, not just make a sale.
GDPR and Digital Banking
The GDPR effects on the financial services sector will be undeniably significant. The regulation has made privacy of customers the primary concern. This is given because of the impact on finance and reputation of large-scale data breaches like the Cambridge Analytica and the Equifax scandals.
The fundamental principle of GDPR is incorporating privacy and data protection considerations for the digital banking industry. Although this encourages best practices and compliance, there is a side effect to all of this. Digital bank owners view GDPR as a challenging and costly regulation that can obstruct projects further. This reservation of bank owners can lead to hesitance to invest in fear of getting it all wrong.
But complying with data privacy law has enormous benefits. These benefits are the following:
- Opportunities for innovation. For many digital banking firms, GDPR is more than just an addition to their regulatory compliances; it is a profitable strategy. More innovative and bolder decisions can be made because of the integration of data protection into core development strategies. This will also give them expertise in data and technology.
- Ethical handling of data. In the digital banking industry, it is an advantage to maintain an ethical approach to data. Financial institutions have rigorously complied and agreed to the GDPR, given that they are the primary gatekeepers to sensitive data of customers. Digital banks have made ethical handling of data a priority.
- Digital defense. One of the benefits of GDPR to the digital banking industry is that it reinforced data processes and procedures for the banks to follow in case of security breaches. GDPR’s role as another line of defense helps ensure the persistence of bank operating online.
GDPR and Cloud Computing
Indeed, cloud computing and data protection go hand-in-hand. One of the industries affected by GDPR is cloud computing. The regulations and legal requirements brought about by GDPR pose not only opportunities but also challenges to cloud computing companies. One of the impacts of GDPR on cloud computing revolves around the sensitivity of the customers’ information. Cloud service providers host different types of data, which includes classified information. This may accidentally fall in the hands of unauthorized parties. The risk of data leakage is present especially when a cloud service is chosen where data storing premises are shared.
Another challenge for cloud computing companies under GDPR is the externalization of privacy. Businesses that avail of cloud service providers expect that the privacy agreements and commitments that they have shared with their consumers and staff will continue to work. If the cloud service provider’s operations are in many locations or jurisdictions, the rights of data owners may be subject to different regulations and requirements. It is, therefore, advisable to have a customized agreement or contract with a cloud service provider regarding privacy commitments.
Apart from challenges faced by cloud computing companies under GDPR, there are many changes that affect the operations of these companies. These changes are as follows:
- Cloud service providers need to conduct regular audits for the scoring, evaluation, and review of organizational and technical measures to ensure the safety of processing.
- Data protection safeguards must be put in place by cloud service providers, from access controls to data pseudonymization and anonymization to encryption in transit and at rest.
- Data controllers or cloud users must have full ownership and control over their cloud data. This is done by signing the Data Processing Agreement.
- The cloud users have the right to delete their data once their contract with the cloud service provider has ended.
GDPR and Healthcare
Patient data management has been altered radically under GDPR requirements. In this regulation, every patient has more control over the information acquired from them and has access to explanations of how their data is used. The following are four effects GDPR has on the healthcare industry:
- Detailed patient profiles. Providers of healthcare will have more detailed information about their patients. This means that diagnoses will be more accurate, and targeted treatments will be at lower costs.
- Safer personal information. Under GDPR rules, data breaches must be reported within 72 hours after they are detected. This will naturally drive the healthcare professionals and institutions to hold tightly and better the data that they are taking care of. Non-compliance also entails higher fines; it will become a driving force for the healthcare industry to implement better data security.
- Putting patients in control. GDPR mandates that the patients are firmly in charge of their sensitive information. They also have the right to stop how their data is utilized and collected if they change their decision about consent.
- From data insights to better prevention. The primary reason why GDPR could give healthcare a considerable benefit is the idea behind big data and how it can unravel the insights contained. The insights that come from the initiative and will to integrate data could accelerate actions to better prevention and enhance the latest types of therapies.
Over a year now from the GDPR enforcement, these aforementioned industries affected by GDPR surely have the needed expertise and resources to make GDPR an asset. Issues and concerns may still arise around what is undeniably a rigorous compliance process, but GDPR has brought about many opportunities for differentiation, strategic advantage, and innovation in a marketplace that is progressively competitive. Contact RSI Security today to ensure that your company is GDPR compliant.