Categories: Technology

Importance and Use of Consent Management

Emerging data protection and privacy laws such as Europe’s General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA) have prompted companies to take consumer consent and data management seriously. Consent management is a process that enables a company’s website to obtain users’ consent before collecting and using their data with the help of consent management software.

IMAGE: PEXELS

When Is A Consent Management Software Required?

According to GDPR, consent management is required by any business that collects data from its EU customers. Whether you use email addresses, cookies, or any other means to collect online data from your customers, you may need to use a Consent Management Platform (CMP).

According to GDPR, there are five reasons why firms collect data:

When they need data to fulfill a contractual requirement
To fulfill a legal obligation
When data is needed for vital interest or to protect one’s life
When the data collected is for fulfilling the performance of public tasks
In case of a legitimate interest or when there is a genuine reason to collect data

In some of these instances, such as when protecting a person’s life, consent isn’t necessary. It can be challenging for firms to know when consent is needed or not. So, organizations are better off using CMP to be on the safe side of the law.

A CMP requests for consent from a site visitor to collect their data. The software will store the visitor’s data collection preferences and consent and collect the specified data and store it for the website. A CMP also deals with users’ preferences, such as requests to make changes to their collected data, including erasing or accessing the data.

Why Should You Invest In A CMP?

Concerns on the use and handling of customers’ data have led to regulations that now govern the use of this data. In Europe, the GDPR requires companies with operations in the EU to ask for explicit consent before collecting their visitors’ data. Similarly, the CCPA established in January 2020 also comprehensively covers consumer privacy issues, ensuring consumers are in control of their data.

Consent management software, therefore, helps organizations adhere to GDPR requirements. It also provides proof of adherence to these regulations protecting businesses from penalties and fines. But the benefits of a CMP go beyond complying with GDPR.

Other notable benefits include:

Enhances customer loyalty – The use of a CMP ensures you respect your customers’ privacy rights. Customers will be confident that you will follow through with their data privacy requests and that you’ll keep their data safe, which enhances trust and brand loyalty. According to a PWC study, 88% of US customers pointed out that how much they trust a firm determines the extent to which they are willing to share with them their data.
Enhances user experience – When customers notice that you’re transparent about using their data, they feel that you’re taking their relationship with you seriously. This makes them happy to do business with you.
Puts consumers in control of their data – CMPs allows consumers to gain control over the use of their data. It informs them how their data will be used and by who. CMP also enables consumers to give or revoke consent to access and use their personal information.

Your consumers trust you with their data, so you must use and protect it well. Using consent management software helps you comply with data privacy regulations and enhances customer loyalty while putting consumers in control of their data.

If you are interested in even more technology-related articles and information from us here at Bit Rebels, then we have a lot to choose from.