How Will the New California Consumer Privacy Act Change Marketing?

As of January 1, 2020, Californians have new rights to control what information companies like Facebook and Google collect from them. This sweeping legislation places onerous new requirements and restrictions on businesses that collect and sell personal information of California residents.

A series of data disasters such as Facebook’s Cambridge Analytica scandal and the massive Equifax breach left many Americans feeling powerless. Regulators stepped in after the fact to punish the companies, but at the time, there was little that U.S. consumers could do to prevent data breaches. Under the CCPA, Americans (well, Californians, mostly) move a step closer to general privacy protection.

Here is a breakdown of what the new California Consumer Privacy Act requires of businesses that collect and sell consumer information:

  • Businesses are required to comply with official consumer requests to delete the data collected about them.
  • Businesses must also offer consumers ways to request a copy of the personal information they have collected, and they must provide it free of charge within 45 days from request.
  • Businesses must disclose what information they collect, what business purpose they do so for, and any third parties with whom they share that data.
  • Businesses can’t charge extra or refuse to provide a service if consumers take advantage of their privacy rights under the new law. But they can offer bonuses or incentives in exchange for information.

What Companies Must Follow This Law?

A business is subject to the law if any one of the following is true:

  • It is a for-profit business with gross annual revenue in excess of $25 million
  • It buys, receives or sells the personal information of 50,000 or more consumers, households or devices
  • It derives 50% or more of annual revenue from selling consumers’ personal information

How Can This Benefit Businesses?

  • Competitive Advantage
    • Data privacy is becoming more important to consumers globally, and customers will gravitate towards companies that provide them with more privacy.

  • More Accurate Data
    • Because the CCPA will restrict the sale of most consumers’ personal information between companies, companies will be forced to rely on first-party data more often. This will greatly benefit companies because they will know exactly where their information comes from and know of its accuracy.

What’s Next?

  • Businesses subject to the law need to amend their privacy policies. Many are already sending Privacy Policy Update emails to their customers. The CCPA added several new substantive elements to the required disclosures that must be included in a privacy notice or policy.

  • The CCPA compliance deadline has been extended to July 1, 2020 in order to grant companies more time and limit enforcement by the attorney general.

The shakeout is just beginning. Stay tuned for updates as we see how this truly changes marketing efforts in California (and beyond).

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