The General Data Protection Regulation (GDPR), implemented May 25th, has introduced a range of new compliance and legal requirements for businesses across all sectors and industries, mainly the need to be accountable with personal data.
Equiteq, with insights from Bart Schermer of Dutch consultancy Considerati, examine the ways professional services consulting firms can turn the compliance burden posed by GDPR into a competitive advantage.
Scrambling to comply
There have been numerous emails from companies asking for consent ahead of the implementation of GDPR.
The truth is, the regulation does not command companies to have the consent of existing clients and customers, those who have bought a product or service. However, offering an opt-out option was, and is, a mandatory requirement for these groups.
The real challenge is an operational one, adjusting sales and marketing processes, so they are compliant with GDPR. Consent is needed for direct marketing to prospects or anyone who has not yet bought products or services, contacts with a non-existing business relationship.
The advantage for professional services firms
There are different approaches professional services firms can take to maintain strong sales and marketing processes that enable sales and revenue growth that are GDPR compliant.
Professional services firms should leverage inbound marketing techniques that incline potential consumers and prospects to offer their contact details.
For example, white papers, reports and articles where access requires the user to input their email address and provide consent, from which the firm grow their database of contacts.
In contrast to outbound marketing, where messages are sent out to everyone, inbound marketing targets people who are genuinely interested in your services and industry area.
Thus, with GDPR, the advantage is with service-based and knowledge-led businesses as advice, council, insights and expertise is what they offer clients and customers.
By providing innovative and nuanced thought-leadership in exchange for consent, professional services firms can continue to generate leads in the age of GDPR.
Shifting attitudes to data privacy
For professional services firms, more concerning than the potential fine of 4% of annual revenue, a high figure but unlikely scenario, is the reputational damage, as demonstrated by Facebook, when consumers perceive that a business is reckless with their data.
GDPR is a positive step forward – forcing a cultural shift whereby companies are inclined to be sensitive with the data of their consumers, clients and contacts.
What’s important for professional services firms is the shift in consumer attitudes brought on by GDPR. Consumers are now more aware than ever of the value of their personal data, only adding to the advantage for professional services firms that offer meaningful thought leadership targeted at contacts who are interested in a given service and industry area.
GDPR and M&A – considerations for sellers
Ultimately, for any professional services firm the quality of its CRM – i.e. the breadth and strength of its networks and relationships, significantly contributes to the current value of the company and its future growth trajectory.
GDPR brings increased risk exposure for potential buyers. They will now ask questions as to whether data is processed in line with GDPR and whether there are sales and marketing processes in place that are GDPR compliant. Sellers must be able to prove they have consent to contact their current network of prospects.
For professional services firms considering a sale, it is not just about the largest database of contacts, it is now about having a legitimate database and secure processing operations and being able to prove this to potential buyers.
If you are interested in learning more about how GDPR impacts your business and would like to discuss your strategic options, please get in touch.
Considerati is a legal and public affairs consultancy working with technology organisations.
Bart Shermer, Chief Knowledge Officer, is a leading expert on ICT law in the Netherlands and acts as head of legal projects at Considerati, advising multinationals and governments on a range of privacy topics.
Bart is associate professor at the University of Leiden, Faculty of Law and a fellow at the E.M. Meijers Institute for Legal Studies.