Loading...

What car dealers need to know about the GDPR and how it will limit current marketing activities

The way in which data is regulated is changing. The changes largely come from the General Data Protection Regulation (GDPR) and how data is collected, used and stored. This may affect the way you collect and use individuals’ personal data. From May 2018, you will have to comply to avoid any potential fines, but more importantly, ensure effective and appropriate use of data. In addition, you need to ensure that your customer is firmly in control and front of mind.

What is the GDPR?

In May 2018, the new EU legislation GDPR is due to come into force in the UK to replace the Data Protection Act 1998.

The GDPR will give new and strengthened rights to individuals concerning the use of their personal data. You will need to manage and store the relevant permissions for using data. You will need an audit trail to demonstrate your usage too. It could, in some cases, make a lot of data that is being held, redundant.

A significant change for car dealers and garages is that the GDPR guidelines specifically ban the use of pre-ticked opt-in boxes for marketing purposes. This means that failure to opt out will not constitute consent. Clear records that demonstrate you have consent must be kept. These records may be asked for at any point by the regulator.

Your customers must also explicitly agree to their data being used for different purposes. For example, if they give consent for you to use their details for a prize draw competition, this will not extend beyond that specific purpose. Such as using their details to send them information on special offers or other marketing. You therefore need to be very specific and thorough in what you ask and what you record as consent.

As it stands, many dealers take advantage of the fact that you can see exactly how your customers research and compare vehicles and dealerships online from the data trail that is left. That data can shed light on some revealing trends in car buyer behaviour and give you a huge advantage to update and tailor the journey to respond to these trends. This is lucrative, but no longer compliant under the GDPR.

The GDPR covers profiling like this. Many dealers may think this is limited to social media or internet search history, but it isn’t. It will apply to data collected from existing customer relationships and their buying habits. This could affect you when and if you use this information in your marketing activities. Like using contact details, you can only collect, process and store this information with clear consent from the customer to do so.

The value of customer data for car dealers and garages

At Experian, we believe that the GDPR presents a positive opportunity to transform the way you organise and process your data; increasing the value you derive from it and reinforcing customer-centric business practices that are essential in our data-driven age. Read our latest whitepaper to learn more.

Customer data is hugely valuable to the used car market. For a long time, it has been used to support customer retention and to boost aftersales activity such as servicing and repairs. However, if the customer has not agreed to be contacted under the new GDPR requirements, as a dealer, you will no longer be permitted to contact them. This is a significant challenge for the market as it changes multiple areas that are most often the most valuable. Because a lot of data has been built up over time, it is likely that you haven’t had this type of insight and consent before. Therefore, it will put limitations on what you can do from May 2018.

The importance of clean data

It isn’t all doom and gloom.

In fact the GDPR presents a great opportunity to be better aligned to your customers. If you look beneath the wording and the shock from the change you can see it clearly outlines a set of data standards. It isn’t going to be easy or quick to get up-to-speed or get all the components ready. But when you do, you can have data that is more accurate and more usable. You can spend your efforts engaging those customers who want to be engaged and you can start to add real value to the relationships you have. Switching your time from volume to value.

So, where do you start?

By cleaning your data, you can highlight the records which need to be removed. This can increase your data accuracy.

By making sure your data is up-to-date you can prevent causing inconvenience to customers. Imagine if you sent someone else’s mail to the wrong address. That could be hugely detrimental to the addressee members and to your brand.

By having accurate address and contact details you can ensure you aren’t wasting postage costs. Let me elaborate on that part. If you mail to 4,500 people and let’s say 30% is returned undelivered, then you have just wasted £877.50 (based on a stamp costing 65p). You do that three times a year and you are in high value figures.

Improving your communications effectiveness can save you time and money. But, more importantly, it protects your brand reputation and ensures your company is legal and compliant.

At Experian, we believe that the GDPR presents a positive opportunity to transform the way you organise and process your data; increasing the value you derive from it and reinforcing customer-centric business practices that are essential in our data-driven age. Read our latest whitepaper to learn more.

This article is about: automotive, data cleanse, GDPR