Consent management and why it matters

Business leaders across the globe need to pay attention to the importance of consent management in their digital operations. In July of 2021, Amazon was given a whopping €746 million fine in Luxembourg for violating the General Data Protection Regulation (GDPR) terms with regards to user data protection.

This was just a sample of the financial implications that businesses may have to encounter if they don’t pay attention to safeguarding the privacy of data customers entrust them with.

So in this post, we’ll talk about what consent management is, how a consent management platform works, and the benefits of embracing consent management.

What is consent management?

In simple terms, it’s a principle that can be used as an underlying strategy when implementing digital solutions that engage and collect data from customers. The mechanism ensures that user consent is obtained after transparently educating them about how each data element will be used by the brand.

Why is a consent management platform important?

Let’s have a brief look at some of the key reasons why consent management services is essential in today’s digital heavy mode of business operations. It helps your business:

1. Avoid regulatory fines

All regulatory frameworks mandate that a business can use customer information for any form of activity only if customers have nodded their consent to use the data. The biggest benefit that businesses will enjoy with consent management is the avoidance of regulatory fines. GDPR alone has set fines to the tune of millions of dollars depending on the type of data violation that has occurred.

For most companies, the fine can result in blowing away their financial sturdiness and push them into bankruptcy.

2. Promote trust

It isn’t just governments that are stepping in to prevent misuse of personal data. Consumers themselves are becoming more aware of their rights to privacy. More customers today know how damaging it can be for their fortunes if sensitive private or confidential data lands up in the wrong place.
They won’t risk the probability of giving up their data in a place that has no respect for protection and privacy. With consent management, however, the collective perception of consumers changes about a brand.

When consumers see your brand has a mechanism in place to collect consent from them before using their data, it improves credibility. Besides, brands have a clear roadmap of how they are going to use every element of the data, and consent management mechanisms make sure consumers are aware of the situations where the data might be used, and they have the option to either permit or reject the use.

With control coming into their hands, consumers will feel more empowered and will also find the brand to be trustworthy since they get to define who uses their data and for what.

3. Collect more legitimate data for marketing

Adding onto the point about winning customer trust, consent management brings about a transparent and secure environment where consumers can confidently share their personal data.

Consumers are educated by businesses and made aware of what processing will be done on their data and who will consume the insights. Empowered customers will now be willing to share legitimate data about their preferences knowing that it’ll only be used to offer the most personalized services to them with no scope for misuse.

This solves the huge problem marketers in different industries face with fake or inaccurate data sets as well as data that is poorly aligned with the business’s marketing vision.

Leverage more trustworthy tools and platforms

The whole principle of incorporating a consent management system in your business will result in onboarding tools and platforms that follow similar approaches. This adds to the trust and transparency qualities mentioned above which can ultimately create more loyal customers for the brand. Your business can leverage a customer data platform to drive email and marketing campaigns which works only after obtaining consent from potential target customers.

It’s important for consent management to be implemented as a core principle behind all customer outreach and data collection initiatives.

This makes sure your business meets stringent privacy rules and frameworks that are increasingly crowding the digital economy. If you’re looking to leverage consent management, sign up for a Lytics free trial.