Data privacy and ethics weigh more heavily on advertisers: WFA

Two years after the onset of Europe's General Data Protection Regulation (GDPR), growing concern exists among some of the world's largest advertisers about the use and misuse of confidential consumer data. As a results, these advertisers are placing more importance on ethical handling of data collection.

According to a new WFA report, Data Ethics – The Rise of Morality in Technology, 82% of respondents would consider leaving their current employer if they felt the approach to data was not ethical, while over a quarter have already felt uncomfortable about the use of data at some time during their careers. Under half of respondents said their company had a data ethics policy in place. 

The findings in the report, based on a survey of 147 respondents representing companies spending $55 billion on marketing communications, come at a time when new research shows that 74% of CMOs say data ethics will be more important to their role in the next five years and issues around data collection and privacy have risen up the agenda in light of COVID-19. 

This report is based on a year’s work by the WFA’s Data Ethics Board, chaired by Unilever’s general counsel for global marketing and media, Jamie Barnard. The board’s members include senior experts from 19 of the world’s biggest advertisers including AB InBev, Diageo, Ferrero, Ikea, L’Oréal, Mars, Mastercard, P&G, Shell, Unilever, and Visa. They have examined issues raised by data and technology and the impact that taking an ethical approach to data can have on companies and people, both internally and externally.

“We should not default to an attitude of “because we can, we should” in terms of data usage, Stephan Loerke, CEO of the WFA, said in a media statement. "The ad industry needs to have a conversation on data that distinguishes ‘the right to do something’ from ‘doing the right thing’."

Others such as Barnard contend that the ongoing pandemic has only re-emphasised the importance of data and technology, but also compelled organisations to review their data ethics and enhances and protects peoples' lives in equal measure. 

Leading advertisers have also noticed this sharper focus on ethics and integrity of data and say people now expect transparency, control, and choice over how their data is used by marketers. “The advertising industry is at a crucial juncture right now," said Raja Rajamannar, chief marketing and communications officer at Mastercard and WFA president. "To gain the trust of consumers, the industry needs to take a proactive approach and demonstrate respect for them and their data. Data ethics is central to this: how can we as brands engage better with consumers to develop trust in a digital world?”

In the report, WFA has listed four principles it says should underpin a data ethics approach:

• Respect: all data usage should respect the people behind the data and companies need to strive to understand the interests of all parties and use consumer data to improve people’s lives.
• Fairness: data usage should aim to be inclusive, acknowledge diversity and eliminate bias rather than dividing groups. Brands need to examine their data sets, mindsets and governance approach to ensure they are inclusive in the way they use data.
• Accountability: Consumers expect companies to have open and transparent data practices backed up by robust global and local governance. The same standards should also be applied across partners, suppliers, publishers and platforms.
• Transparency: Although the online advertising ecosystem is complex, brands should apply transparency principles and work towards more open and honest data practices, particularly as AI and machine-learning approaches start to automate decisions.

Some marketers admit that while data helps marketers personalise their campaigns, in a world rich with choices, the industry needs to handle data collection and use with the highest level of transparency. "Consumers’ trust is the number one currency for our brands and the reason why we need to rethink data sharing as true value exchange. We need the entire industry to shift towards a more positive, transparent approach to data," said Lubomira Rochet, Chief Digital Officer, L’Oréal.