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Why telcos are well positioned to respond to the challenges of GDPR

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 Telcos are likely to be winners when it comes to engagement through marketing and promotions in the new GDPR world.Paul Skeldon reports

 GDPR may be a lot of work – certainly a lot of emails – but it can have some benefits. And chief among those is the impact it may have on telcos when it comes to marketing and promotions.

According to research by Smartpipe, more than 80% of consumers would allow their personal data to be used by their mobile network operator (MNO) for the purpose of advertising when privacy enhancing technology is a clear part of the “value exchange”.

When simulating the “fully compliant GDPR experience”, but without the value of a privacy enhancing technology, publishers – the traditional route for most data to enter the ad market – achieved a 50% opt-in rate. Brands from other sectors fared slightly better – with an average for banks of 57% and 64% for supermarkets.

On a like-for-like basis – with no additional data protection message and a reliance on “open” third-party data transfers – mobile network operators achieved a 52% opt-in rate among their customers.

But, with the right data protection message – stressing investment in innovative privacy enhancing technology coupled with a “no third-party sharing” proposition – consent rates for MNOs rose to 83%. This uplift can be attributed to clearer messaging and proof points about privacy and the simpler choice offered when no unfamiliar “third party” ad tech vendors need to be named or consented to in the process.

Under one tested publisher consent scenario, only one in 10 (10%) ad tech vendors end up with permission for consumer data to be used for personalised advertising when fully complying with GDPR requirements. Under all tested publisher route scenarios, Google and Facebook end up with the lion’s share of ad vendor consent – potentially further strengthening their already dominant position in the industry.

This research presents a significant opportunity for telcos to enter the digital advertising ecosystem – under the right data protection conditions – during this critical post-GDPR timeframe.

“The GDPR was always going to highlight those companies that are well placed to deal with compliance issues, and our research shows that telcos hold a strong position to respond to consumers’ privacy concerns,” says Chad Wollen, CMO of Smartpipe. “The power of new entrants to keep the flow of high-quality data into the ad sector – by leveraging new technology and transparent user experiences – highlights the potential that telecoms operators have to explore, over and above traditional ad tech vendors.”

The study of the UK general public simulated different consent-gathering experiences which were crafted to recreate the different consent collection approaches being deployed for GDPR by different publisher websites, as well as actual companies consumers frequent or contract with. The respondents were prompted to mimic communications with websites about how their personal information could be collected and used, and behave as if they were giving permissions for that website.

Rob Vance, Vice President at PSB EMEA adds: “This is a really fascinating piece of research – we were able to model a number of different scenarios and understand how consumer behaviour is likely to change, based on both the initial framing and consumers’ growing understanding of the issues around data privacy. What is clear is that companies will need to rethink how they approach permissions and start listening to consumers more before taking action.”

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