What the CCPA means for your business

Insights / 2019.12.11

What the CCPA means for your business

The California Consumer Privacy Act (CCPA) will soon change the way ad tech companies around the world collect and use data. If that includes you, it’s time to start reconsidering how you do business, first in California, and eventually everywhere else, since data privacy legislation will likely only become more widespread.

The act, which goes into effect on January 1, 2020, essentially gives consumers the right to know and control exactly what personal information businesses are collecting about them and what those businesses are doing with it. Consumers must be able to access their information, and they’ll even have the right to put a stop to its sale and seek damages if it’s lost or stolen. Finally, they’ll have the right to do all of this without impacting the price of the item or service they’re purchasing.

The CCPA is the United States’ first sweeping privacy legislation and has relevance for any companies doing data-driven business in California. While the act won’t be enforced until July, its passing has led to a wave of similar legislation in other states, including Nevada, New York, Texas, and Washington, meaning data privacy will eventually become a necessary legal consideration for most businesses.

For this reason, there’s a great deal of concern arising around what to do in reaction to these new laws and how to avoid steep non-compliance fines. Here are our observations on how to approach the changing data privacy laws.

  1. Take a page from European businesses. The CCPA is the first major North American statute that’s been passed, but it mirrors laws that have been in place in Europe for a while. In the EU, data privacy is much more strictly protected than it is in the United States. Essentially, the onus is on the digital advertiser or company to ensure they comply with data privacy laws. We predict the toughest hurdle will be giving people the ability to delete their data from your data set, and providing them with proof you’ve done so.

  2. Remember - information is power. As they say, with great power comes great responsibility. So, as business owners who wield the power to access and use our customers’ personal information, we have to remember that people aren’t statistics, and while data may equal dollars, it can also represent deeply private information that shouldn’t be shared or sold.

  3. Be ready for change, even if it doesn’t come right away, or ever. The digital advertising landscape could change drastically if the majority of people choose to exercise their rights under these laws. However, we have a feeling that won’t happen. Consumers have gotten quite comfortable with letting companies use their data to improve their online and offline experiences via personalization, recommendations, and other benefits. However, we predict a minority of people will exercise these new rights, and it’s important to have all your data ducks in a row so you don’t become a cautionary tale.

  4. Know what’s happening in different states where you do business. While Nevada is the only other estate to have actually passed a law similar to the CCPA, legislative wheels are turning all over the country. Until a federal law gets proposed and passed, any state laws that get passed will vary based on everything from politics to population. Some states will be more business-friendly than others, so make sure you have a data collection and usage plan in place that addresses the legal nuances in different states.

In the long run, we’re a fan of these data privacy laws, because we know they’ll encourage businesses to become more transparent. And now, more than ever, consumers are seeking open, honest, transparent companies to do business with.

Tandem Theory’s Data Science Team is led by data privacy subject matter experts who are always discovering new ways to build successful businesses using ethical data collection and usage practices. If you’d like to learn more about how we can revolutionize your approach to data, send an email to info@tandemtheory.com.