Privacy Spotlight: Congress is Expected to Pass Major Consumer Privacy Legislation in the Coming Months. What Does This Mean for Brands?

The American Data Privacy and Protection Act (ADPPA) has bipartisan support in congress, and pending subsequent drafts, is likely to become law. The ADPPA is perhaps best described as the US equivalent of the European Union’s General Data Protection Regulation (GDPR), the strictest privacy and security law or regulation in the world. Although the ADPPA doesn’t go nearly as far in its regulation of businesses’ use of consumer data, it is the largest federal action on consumer privacy in American history.

The bill’s new restrictions to data collection will be a significant hurdle for brands that have emphasized their digital marketing efforts in recent years; however, there are still meaningful benefits and opportunities in a privacy-centered world for those who understand how to connect with their audience.

Data Has Been a Big Issue in the ‘20s

From healthcare to crypto, social media to banking, it seems as if no industry is safe from data breaches and privacy concerns, particularly in the past 2-3 years. And between the forthcoming death of third-party cookies and the privacy overhaul implemented in iOS last year (also in response to a data breach), it’s clear that major tech companies are responding to consumer needs for privacy. In a similar response to these needs, the legislation proposed in ADPPA focuses on “data minimization,” meaning it aims to limit the information brands and marketers can collect digitally, and allows consumers to have greater control over how (and for how long) their data is collected, used, and stored.

Many brands have become accustomed to collecting (and in some cases, transferring) consumer data on a regular basis in order to inform their marketing goals and overall business strategies. It’s important to remember that, as a federal bill, ADPPA would streamline privacy regulations that can currently vary by state, which could be a boon for consumers and brands alike. While any federal-level privacy regulations will be a win for consumer advocates, they don’t have to be detrimental to brands’ bottom lines—and the key is adaptation.

How Brands Adapt

We’ve touched on adaptation as a key element of brand longevity previously, and it’s just as true for privacy and data concerns as it is for the type of marketing channel a brand chooses to pursue. In order to get a leg up in this new environment, it’s important to keep a few tips in mind.

Under the ADPPA, consumers will be given the explicit choice to turn off (or explicitly opt into) all tracking across web platforms and geo-location. However, for the time being, that data is still being collected. Prior to ADPPA being enacted, brands can retain the data they’ve collected and use AI to model it. By analyzing already existing data, brands will gain a better sense of the kinds of creative campaigns, strategy, and placements will result in conversions.

Second, not all industries will be affected equally. The bill includes heightened restrictions for healthcare data, and for brands that advertise to minors. The simplest way for brands to respond to these changes is to be transparent. Being clear with consumers on the precautions being taken to protect sensitive data and data potentially gathered from vulnerable populations will go a long way in reinforcing trust in the brand and its values. In addition, brands that rely on third-party data for their targeting and marketing efforts should start testing other models for reaching an audience as soon as possible in order to prepare for when those avenues disappear.

Creative Solutions

If anything, digital marketing has shown it is a resilient industry. The CAN-SPAM act of 2003 regulated email marketing practices, forcing brands to evolve the way they reached consumers. The brands who were able and, crucially, willing to adapt continued to be successful, and there’s little reason to think the same won’t be true after privacy regulations are enacted.

Data giants such as Google have yet to react substantially to the bill, which begs the question—how impactful will the passed version of ADPPA actually be? As Brownstein Lead Creative Technologist, Will Murdoch noted, “Google has been working on reinventing data personalization for years, and have spent billions of dollars on it, but they aren’t putting up a fight about this. It begs the question: If this legislation doesn’t feel like a threat to them, is it really doing anything effective?”

The truth is, the ramifications of legislation such as ADPPA are still somewhat nebulous; however, preparing ahead of time is always in a brand’s best interest if they want to ensure longevity. As the US waits to see what the final bill will look like, brands that invest in audience-tested creative, successful campaigns and understand where their placements will be most effective have an opportunity to outpace competitors that are slow to embrace the upcoming changes to consumer privacy.