GDPR and Its Implications for Retargeting Advertising and Challenges in a Data-Driven Landscape

Key Takeaways:

• Retargeting advertising relies on cookies and tracking technologies to gather consumer data and deliver customized ads, but the GDPR has made it more challenging to use personal data in this manner.
• Securing explicit consent is difficult, as many consumers may not understand the implications or may be unwilling to provide consent, reducing the effectiveness of retargeting campaigns.
• The GDPR grants consumers the rights to access, rectify, erase, and restrict the processing of their personal data, which can negatively impact retargeting advertising as consumers can opt out of data usage for this purpose.
• Apple’s Safari Intelligent Tracking Prevention (ITP) also poses a challenge, as it blocks third-party cookies, further hindering retargeting advertising efforts.
• Companies may need to explore alternative methods for delivering targeted ads and maintaining consumer profiles to continue being effective in a GDPR-regulated landscape.

What is the GDPR?

The General Data Protection Regulation (GDPR), which came into effect on May 25, 2018, is a comprehensive data privacy legislation aimed at safeguarding the personal information of EU citizens. By streamlining the regulatory landscape for international business and unifying data protection regulations across the EU, the GDPR has granted EU citizens greater control over their personal data.

One critical aspect of the GDPR is the mandate for companies to acquire explicit, freely given, and informed consent from individuals prior to collecting and processing their personal data. This requirement has significantly impacted the efficacy of retargeting advertising, a marketing strategy heavily reliant on the collection and utilization of personal data to deliver customized ads to consumers.

Retargeted Advertising

Retargeting advertising, commonly referred to as remarketing, entails the use of cookies and other tracking technologies by companies to accumulate data on consumers’ online behavior, including website visits and product views. Subsequently, this data is employed to present tailored ads to consumers on other websites they browse.

In accordance with the GDPR, companies are obligated to obtain unambiguous consent from consumers prior to the collection and usage of their personal data for retargeting advertising purposes. Consequently, consumers must be duly informed about the intended use of their data and actively consent to their data being gathered and utilized in this manner.

Securing explicit consent poses a considerable challenge for companies that depend on retargeting advertising. Owing to a lack of understanding regarding the implications of providing consent or an unwillingness to do so, many consumers may withhold consent. This impedes companies’ ability to deliver targeted ads, consequently diminishing the effectiveness of retargeting campaigns.

Furthermore, the GDPR accords consumers the rights to access, rectify, erase, and restrict the processing of their personal data. In essence, consumers can demand the deletion of their personal data or the restriction of its use. These rights can also adversely affect retargeting advertising, as they enable consumers to opt out of data usage for this specific purpose. The resulting difficulty in constructing and maintaining precise consumer profiles, which are crucial for delivering targeted ads, further compromises retargeting advertising efficacy.

Blocking of Advertising Cookies By Apple

Another challenge is that Apple now blocks most advertising cookies. Apple released a major update to its Safari Intelligent Tracking Prevention (ITP), which is a privacy feature that allows the company’s web browser to block cookies and prevent advertisers from snooping on your web habits. According to Apple’s John Wilander, the WebKit engineer behind the feature, Safari now blocks all third-party cookies. 

GDPR has significantly influenced the effectiveness of retargeting advertising. While the regulation’s primary objective is to protect the privacy of EU citizens, it has concurrently rendered the utilization of personal data for retargeting purposes more challenging for companies. Consequently, businesses may need to explore alternative methods for delivering targeted ads and for creating and maintaining consumer profiles in order to sustain effectiveness in this domain.

by :

Eamonn O'Raghallaigh, PhD