How Will the DATA Act Affect Digital Marketing?

The Data Accountability and Transparency Act of 2020, or DATA Act, has been proposed by Senator Sherrod Brown. It hasn’t been officially introduced in Congress, and the Washington Post doesn’t think it has a chance of becoming law, but it is a new take on internet privacy.

Basically, it makes collection of personal data opt-in rather than opt-out. Goodbye, privacy policy notices that nobody reads. But also, goodbye to the rich veins of data we’re used to using to make marketing decisions.

What if it does in fact become law? How will it affect your online marketing?

Automated decision making systems

Most of the law refers to “automated decision making systems,” and most of our readers don’t actually use such systems directly. That is, you probably don’t directly collect personal information from visitors which feeds into an algorithm at your website that selects advertising experiences for your viewers.

But you probably do use systems like that to configure your ads at Facebook or in Google Ads. You may also use them to make marketing decisions with tools like Google Analytics. 

Studies on automated decision systems such as Google’s search algorithm will be required. They will involve, “at a minimum,” 

a detailed description of the automated decision system, including

  • its design and methodologies
  • training data characteristics
  • data
  • purpose

It sounds as though Google and Facebook and the rest would not be able to keep their algorithms secret. 

They also can’t do any of these things:

  • share personal data with affiliated entities, service providers, or third parties;
  • use personal data for any purpose other than to carry out a permissible purpose;
  • retain personal data for any time longer than strictly necessary to carry out a permissible purpose; or
  • derive or infer data from any element or set of personal data.

The owners of the automated decision making system must regularly test and report on the behavior of their software, making sure that protected classes of people are not being affected negatively. 

Personal data

Personal data can still be collected under this new law. There are lots of restrictions about collection and clear language saying that data cannot be used to discriminate against anyone. 

We don’t have to speculate about how this will affect ads. The Act tells us that data can be collected only for specifically permissible actions, and one of those actions is 

The development and delivery of advertisements—

(A) based on the content of the website, online service, or application to which the individual or device is connected; and

(B) excludes advertising based on the use of any personal data collected or stored from previous interactions with the individual or device, a profile of the individual or device, or the previous online or offline behavior of the individual or device.

So Google Ads based on someone’s searches would be okay, but remarketing would not be. 

Another permissible action is offering discounts or free stuff — but only if

(A) the offering is in connection with the voluntary participation by the individual in a program that rewards individuals for patronage; and

(B) personal data is only collected to track purchases for loyalty rewards under the program described in subparagraph (A).

So your rewards program is okay, but collecting information through quizzes and offering discounts to hot prospects would not be okay.

Another interesting rule is this one:

RULE OF CONSTRUCTION.—Collecting, using, or sharing personal data to generate advertising revenue to support or carry out a permissible purpose is not a permissible purpose.

You also can’t

Re-identify, or attempt to re-identify, an individual, household, or device from anonymized data (unless conducting authorized testing to prove personal data has been anonymized).

In the old days, it could occasionally be possible to identify someone with varying degrees of certainty from the network they used to visit your website. You could at least see what corporate offices were visiting your website, from what city, at what time of day. Reaching out to an office by phone could be a logical next step for a salesperson. Google no longer provides the data that made that even slightly possible. Some other tools still may.

What to do now

It is possible that the DATA Act, if it becomes law, will have significant effects on tools you currently use, especially when it comes to digital advertising. It probably won’t affect your website directly, though. If your heart sinks when you read this article, though, you might want to do more of the things you think are breaking the rules… before they become law.






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