Data Processing & Collection Strategy — Part I

The Recital 39 of the General Data Protection Regulation (GDPR) says that “any processing of personal data should be lawful and fair. It should be transparent to natural persons that personal data concerning them are collected, used, consulted, or otherwise processed and to what extent the personal data are or will be processed. The principle of transparency requires that any information and communication relating to the processing of those personal data be easily accessible and easy to understand, and that clear and plain language be used.”

And continues on Recital 40: “For processing to be lawful, personal data should be processed based on the consent of the data subject concerned or some other legitimate basis, laid down by law, either in this Regulation or in other Union or Member State law as referred to in this Regulation, including the necessity for compliance with the legal obligation to which the controller is subject or the necessity for the performance of a contract to which the data subject is a party or to take steps at the request of the data subject before entering into a contract.”

Why does data collection and processing need close cooperation from Marketing, Legal and Technical departments?

As companies operating in the digital world, we need to collect and process the customer’s data while making sure he/she is aware of what pieces of data are being used, as well as how, why, and when they are being used. Of course, besides the customer awareness, we also need his/her explicit consent.

That is why close cooperation between Marketing, Legal, and the IT department is very important. Whatever strategies the marketing team is designing needs to comply with, for example, GDPR requirements, so the legal team is the marketing team’s go-to when it comes to making sure all processes are following the best practices. At the same time, the IT team has to make sure there are no technical barriers to properly collect and process customers’ data.

Why do different companies do it differently?

Data collecting and processing methods differ from company to company and the number one reason is the company’s goals for that data; although, of course, everyone has to properly comply with GDPR.

When it comes to data collection, there are two types: primary and secondary. The difference between the two is just a matter of whether the data has ever changed hands. Primary data comes directly from the source; it has not been analyzed, arranged, or touched in any way. Secondary data has undergone at least some sort of treatment.

And talking about what technology can do for an online store, for example, we have the reality of first and third-party cookies, in which the cookie (“tracking method”) is created by the domain that a web user is visiting (first-party cookie), or by an external domain (third-party cookie).

To protect user’s privacy, web browsers are taking severe actions to restrict third-party cookies — Safari is a good example of that; following this security trend, Google announced their sandbox project to also restrict these tracking starting in 2022.

Why is data your next competitive advantage?

eCommerce is here to stay. The industry is on constant growth and, according to Statista, it will continue to grow as many more people are getting online for the first time and with better gadgets and bandwidth (approximately 40% of the world population still doesn’t have access to the internet).

However, with more demand is also coming more and more supply — suppliers to be specific. But what does that mean to eCommerce companies? Well, more competition might be good for the free market but a challenge to many companies.

And the root of these many challenges is that with the dozens of, sometimes hundreds of, options to buy online, customers will start to see eCommerce as a commodity business (the majority of the players offer the same products and services for basically the same price (a low price).

Here is where data can put any eCommerce ahead of the curve. Data — and the possibilities of properly collecting and processing it — will be the next competitive advantage of any online store. Differentiate quality and price will be hard since suppliers will mainly be the same.

But the ability to know who your customers are will be the key factor to great results despite the enormous amount of competition. Knowing your customers’ actions, interests, online behaviors, personal information, history, etc., empowers your business with the necessary means to great results.

On the other hand, ignoring this and insisting on communicating the same message to every customer will become, more and more, a waste of time, energy, and money.

As we all know, Conversion Rate Optimization requires constant and efficient data analysis to generate good pieces of information and intelligence.