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When companies come looking for permission to use their European customers’ data after the General Data Protection Regulation (GDPR) takes effect on May 25, 2018, the answer may well be “no.” In a recent OliverWyman survey of 1,500 British consumers, our company discovered that as many as half said they were already leaning toward reclaiming their information.
That gives companies less than 12 months to figure out what it will take to get customers to say “yes” — as well as to figure out procedures and safeguards to assist consumers with accessing, editing, exporting, and deleting any or all of their personal data. And neither job will be easy.
The GDPR complicates business models for both European and U.S. companies. While President Donald Trump removed requirements in April for internet service providers to obtain permission from customers before sharing personal data, the GDPR will still force U.S. companies to deal with the new data rules if they want to do business in the EU — a juggling act that could prove expensive.
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But the greater challenge ahead may lie in the anticipated consumer data wars that will arise between the companies that customers trust enough to compile their personal data and the companies forced to let their data go. In this environment, the “haves” will be able to keep customizing and improving their offerings to EU citizens using more data than they ever dreamed accessible. At the other end of the spectrum, new products and services sold by “have-nots” will likely emerge slowly — or worse, miss the mark entirely because of the lack of insight into evolving customer needs and tastes.
With the GDPR, companies will be able to access data from both rivals and players outside their industry by enticing consumers to transfer their information. One way this could be accomplished is by offering better prices and services to customers who park their personal data with them. Traditional barriers to entry based on data collected over decades will be demolished, enabling small and nimble tech-based competitors that gain consumers’ trust to become potentially widespread.
The good news is that companies can get ahead of this inevitable shake-up by thinking and acting more like consumer-data champions. To keep customers’ trust, most enterprises will strengthen safeguards against security breaches.