With the General Data Protection Regulation (GDPR) approaching, several marketing tech firms are pivoting their business models to avoid the risk of getting their hands slapped.
The EU’s GDPR becomes enforceable in May and stipulates that a user’s data can be used only if that individual gives a company explicit permission. Because companies that are found to be in violation of the GDPR face a fine of €20 million ($22.1 million) or 4% of global revenues (whichever is greater), firms that rely on sensitive data are treading in uncertain waters. Subsequently, several tech vendors have restructured their business models around the looming regulation.
The GDPR contributed to location data company Verve closing its operations in Europe, reported The Drum. In March, cross-device vendor Drawbridge yanked its ad business out of Europe. And in January another cross-device specialist, Tapad, ended its media services and pivoted its business to resemble a customer data platform, which is a tech category that is banking on the GDPR by focusing exclusively on first-party data.
Even the most powerful players in the ad industry are having to tweak their functionalities to adjust to the GDPR. Facebook is beginning to ask users to agree to its new data policies and review their ad preferences. Some industry observers believe the adjustments Facebook is making around the GDPR will fundamentally change how ad targeting works in its platform