Are you struggling to comply with cookie consent regulations on your website? Do you find it challenging to design a cookie consent banner that is both compliant and user-friendly? If so, you’re not alone. Many website owners face these challenges and are unsure how to address them.
Did you know that 2.5 quintillion bytes of data are created every day?
Data has become the new frontier for innovation, competition, and productivity in today’s tech-centric world. Organizations of all sizes are using data to fuel business decisions—a trend that has given rise to a new era of big data and data warehousing.
And as data continues to shape the business world, data privacy and consumer protection have become the top concern for businesses. The increased awareness of data privacy has resulted in a series of data privacy regulations. These regulations empower consumers to take control of their data and govern how businesses use it.
Consent management platforms (CMP) have grown in popularity in the wake of evolving privacy regulations because they allow businesses to collect and manage user consent. In this guide, we’ll explore consent management platforms in detail and share some pointers on choosing the right CMP for your business. But first, let’s get down to the basics.
What Is Consent?
A critical aspect of privacy and data protection is “user consent.”
Different laws and disciplines have other ideas of what consent means. The Oxford Dictionary defines consent as “permission for something to happen or agreement to do something.”
In privacy and data protection laws, consent means giving people a genuine choice and control over how businesses use consumer data. It must be given freely, meaning the user cannot be forced to say “yes” to a data processing activity.
Most common data protection laws require consumers to consent to use their data. For example, article 6 of the EU’s General Data Protection Regulation (GDPR) says that a user’s consent is required to collect and process user data legally.
Along the same line, article 7 of Brazil’s Data Protection Law (LGPD) requires organizations to seek user consent before processing or using personal data.
Types of Consent
Currently, there are three approaches to consent used by companies.
- Opt-in consent
- Opt-out consent
- Hybrid consent
All share a common thread in that they obtain consent to collect, use, and distribute personal information. Let’s briefly go over these approaches.
Opt-In Consent
An opt-in process requires users to take action to confirm their consent to collect, use, and disclose personal information.
Opt-in consent means you ask your site users for permission before collecting and using their data. As companies worldwide implement data protection policies, relying solely on the opt-in procedure will become more challenging. Requiring users to manually consent to some or all of a company’s privacy policies gives users greater control over their data.
The opt-in approach is followed by the EU General Data Protection Regulation (GDPR), Thai PDPA, Brazilian LGPD, and others that follow the standards set by the GDPR.
Opt-Out Consent
Most commonly recognized by US consumers, opt-out is a method that allows users to “opt-out” or stop the collection, use, or sharing of their personal information.
Opt-out means the user’s data can be collected and used by anyone at any time and by any means and can be processed freely until the user restricts further processing of their data. With the opt-out approach, consent is not required for data processing.
With this option, consumers must take action, like filling out a form, to withdraw their consent for their data to be used or shared online. Opt-out rules are better at protecting consumer privacy than opt-in processes. The CCPA requires organizations to disclose the information they collect and its purpose. It also allows users to withdraw their consent if they deem their privacy at risk.
The opt-out concept is in the California CCPA and CPRA, Connecticut DPA, Utah CPA, Virginia CDPA, and upcoming Colorado CPA.
Opt-out is no longer accepted in European countries, making opt-in the go-to way for international companies.
Hybrid Model
A hybrid model incorporates both opt-in and opt-out options, depending on the data collection type and how it’s being used.
A hybrid model can allow companies to remain compliant with GDPR, CCPA, and other data protection standards while giving users total control of their privacy.
When Is Consent Required?
Consent is a legal ground for collecting and processing user data under EU law.
Explicit consent is required where there’s a data protection risk and a higher level of control over the processing of personal information. WP guidelines mention a few situations where you may need explicit consent.
- When collecting and processing sensitive personal data
- When transferring data to a third party
- On automated individual decision-making, including profiling.
Typically, the use of cookies requires consent. As per the GDPR and ePrivacy Directive, a website must ask for permission to use cookies from its users. These cookies need support because they collect site visitors’ data—and this data could be used for malicious purposes if it falls into the wrong hands. Here are some of the website activities that require cookie consent.
- Tracking website visitors with Google Analytics
- Profiling users with social media pixels
- Tracking users’ browsing behavior
- Allowing users to share content on social media via plugins
Some data protection laws, such as the California Consumer Privacy Act, Colorado Privacy Act, and Virginia Data Protection Act, rely on the opt-out principle. GDPR, on the other hand, requires opt-in consent for data processing.
What Is Consent Management?
Consent management allows consumers to determine what data they want to share with a business. It has become popular worldwide due to the legal requirements for websites to obtain consent for collecting and sharing user data through cookies while browsing.
Due to the data protection laws, businesses globally are responsible for collecting and managing user consent and adhering to the relevant data processing standards.
A proper consent management system should define as follows:
- What data to be collected
- How the collected data will be used
- How the data will be stored
Most importantly, it must allow customers to withdraw or change their data anytime. This way, consent management aids compliance by informing users about a company’s data collection and usage practices.
What Is a Consent Management Platform (CMP)
A consent management platform, or CMP, is a tool that helps websites collect and manage user consent in line with data protection laws and regulations, like GDPR and CCPA.
Think of a consent management platform between the publisher and the user. It informs the user (website visitor) about the type of data the publisher will collect and what the data will be used for. It also enables users to modify their cookie data settings, store the changes, and opt out of these settings.
To the consumer, this is simply a quick dialogue. The dialogue allows them to choose how their data will be used. These preferences are stored and ultimately define and control how data moves between the publisher (website) and the broader advertising ecosystem.
A CMP gives you insights into the personal data lifecycle, from the moment of user opt-in to data removal, allowing you to manage user requests and preferences. It also allows you to centrally manage notices and distribute them to all consent collection channels.
These platforms are designed to handle all compliance aspects, allowing businesses to automate the consent process, gain consent to track first-party data and enable users to update their preferences easily.
Although many consent management platforms are on the market, each offers different features and functionalities. Choose one that meets your business needs, especially when integrating your front-end consent collection channels, such as CRM.
Consent Management Design
The design of a robust consent management platform needs to include the following:
- Consent collection – multiple channels are used for consent and preference management
- Data processing – Marketing analytics and other data analytics based on consent
- Consent management engine – Harmonization engine and a single source of truth
In today’s omnichannel marketing world, we collect user data from multiple channels—websites, email, social media, point of sale, mobile applications, etc.
Robust consent management design should include all customer-facing channels to ensure data collection and processing align with users’ preferences.
The consent collected should be stored in a central consent repository. This should be a secure database and a single source of truth for all data processing based on the user’s consent. The consent management engine identifies data subjects (users) and harmonizes their consent preferences obtained through different collection points.
What Can a Consent Management Platform (CMP) Do?
As mentioned, the purpose of a CMP is to help businesses collect, manage, and update user consent. But that’s not all it can do! Here are some features and functionalities you can use when using a consent management platform.
Interpretation
Regulations surrounding legal texts can be confusing.
A robust consent management platform can translate and interpret these documents into easily understandable terms. Understanding the legal jargon surrounding data privacy can help you stay compliant and up-to-date with the latest changes.
Automation
An obvious benefit of using a CMP is automation. This platform automates a lot of time-consuming tasks associated with managing consent.
From sending consent notifications and expiration reminders to updating consents when there are changes to the law, a CMP automates all these processes, freeing your staff time to focus on other tasks. Automating these tasks makes your team more productive.
Reporting & Analytics
Most CMPs have a reporting and analytics dashboard that gives insights into your consent processes.
For example, you might see the number of people who have given consent, what type of consent they’ve given, and how they interact with the banner. Such information can help identify areas in your process that could be improved.
Archiving Consent Records
Another critical functionality of consent management platforms is archiving and storing consent records. This can prove helpful in providing proof of consent, especially if they are consent disputes down the road.
Disabling Unauthorized Cookies
The EU GDPR requires businesses to get consent from customers before accessing or storing any information on their devices—including cookies.
A CMP can help you quickly achieve this by automatically disabling unauthorized cookies and third-party scripts. This ensures you’re only collecting and storing information that the customer has given you permission. Note that failure to comply with data privacy laws may result in penalties.
Key Features of a Consent Management Platform
The key features of a consent management platform include the following.
1. Consent Collection
The primary function of a consent management platform is to collect and manage user consent. Prevailing data protection laws require consumers to be informed that their data is being collected and used for specified purposes.
Popups and cookie consent banners are websites’ most common implementation of consent requests. For consent to comply with the European GDPR, it must adhere to the following standards.
- Consent should be freely given – Users should be given choice and control over how their data will be used. Support is invalid and not freely given if users have no natural choice.
- Consent should be informed – the purpose for which the subject data will be used should be clearly stated in a language the user will understand
- Consent should be for a specific purpose – the customer should consent to use cookies for the specified purpose only and not for any other kind of personal data processing.
- Consent can be withdrawn – The user should be able to revoke the permission whenever they feel their privacy is in jeopardy.
A good consent management platform should make collecting, managing, sharing, and storing user data easy.
2. Record of User Consents
A consent management platform needs to maintain a centralized trail of user consent to ensure compliance with privacy regulations.
This is important for regulation standards, like GDPR, that require businesses to demonstrate their compliance. Data privacy authorities may need you to confirm that you comply with the governing data protection laws.
Should this happen, you’ll need a record of your collected user consent. A robust CMP should enable you to record the following documentation in the consent log.
- Who gave consent – anonymized IP address of the customer who gave the consent, including their country
- When the consent was granted – the date and timestamp of when the consent was granted
- What was consented – the user’s consent status, i.e., whether they accepted, rejected, or partially accepted, and the cookie category they chose.
3. Auto-Blocking Third-Party Cookies
Third-party cookies are cookies set by a website other than the one a user is currently on. These cookies can be used for malicious purposes, such as tracking website users to steal their personal information, posing a security risk to users.
A consent management platform should block third-party cookies until the user takes action through the cookie banner.
Robust CMPs feature advanced mechanisms for blocking third-party cookies, like Facebook Pixels and Google Analytics. They also allow you to add unauthorized third-party cookies to stop manually.
4. Categorization of Cookies
A good CMP should have an in-built cookie tracking software that scans websites and identifies what cookies, tags, beacons, tracking pixels, and other technologies are deployed on a website.
Once the scanning is complete, the platform should allow you to categorize cookies based on various parameters, such as necessity, performance, advertisement, etc. A report should also be generated and available in your cookie consent banner’s ‘preferences’ section.
5. Banner Customization
While the General Data Protection Regulation stipulates the requirements for what valid consent should be, it doesn’t state how the cookie banner should look. This means banner customization doesn’t violate any of the GDPRs.
A good CMP should allow you to customize the cooking banner to reflect your site’s design and branding. The best CMPs offer over ten cookie banner customizations, including the colors, layout, content, and advanced CSS options.
Choosing the Right Consent Management Platform for Your Business
Choosing the right fit CMP for your business is critical for many reasons. Not only does it help you stay compliant with the prevailing privacy regulations, and makes it easier for you to collect, manage, and derive insights from the consent data.
Care should be taken when choosing a consent management solution for your business. Here are the three subjects to consider when investing in a CMP for your business.
Proper GDPR Configuration
If you’re in the EU region or a country that follows the GDPR standards, you’ll want to ensure proper GDPR configuration to avoid potential fines.
In the early days of GDPR, collecting data before any consent was granted was common practice. With time as GDPR evolved, it was found that the current standards were lacking and didn’t provide ample protection to consumer data.
The Court of Justice of the European Union (CJEU) declared the former GDPR standards not compliant with the Planet49 decision. The CJEU interprets European law to ensure it’s applied universally in all EU countries and settles disputes between EU institutions and the National government.
In the Planet49 case, the court ruled that requiring website users to “uncheck” checked boxes is not a valid form of consent to be used with cookies, as it’s not an “affirmative action” taken by the user, hence the need for prior consent in GDPR.
Prior consent, or “opt-in consent,” requires users to explicitly grant permission to collect and use their data. This is core functionality in high-end CMPs though some free or consumer-grade options don’t offer it.
Notice Clarity
GDPR requires clarity when disclosing what the company intends to do with the consumer data it collects. According to the standard, this information should be presented straightforwardly so the user will understand. Being transparent about data collection can also help built trust with your site visitors and customers.
The easiest way to ensure ‘notice clarity’ is to adopt a vendor-based rather than a cookie-based approach.
The average consumer isn’t tech-savvy and may be unable to make sense of a list of cookies. They need to know who dropped the cookie and concise information about how the vendor handles the data collected.
Notice Accuracy
The beauty of using a CMP is that it automatically scans your website and updates your notices to contain only the current vendor and data-sharing information.
However, the frequency of these scans varies from platform to platform. Most CMPs update monthly, but changes could happen sooner than that, posing a compliance risk.
To get around this, opt for a more advanced CMP that leverages real-time scanning from users and browser data, ensuring compliance at all times.
How to Choose the Right Consent Management Platform for Your Business
As mentioned, the CMP market is rapidly evolving, with hundreds of vendors. With many platforms claiming outstanding services, finding the right system for your business can be tricky.
So, how do you find the right CMP for your business? We’ll summarize the process into two key steps.
- Start with internal clarity about your consent processes
- Ask yourself these critical questions
Step 1: Gain Clarity into Your Internal Consent Process
Choosing the right platform to cover all your consent bases is essential to effectively manage your consent issues while complying with the governing rules.
Even the slightest mistake can have dire consequences down the line. But before you begin platform assessments, get clarity about current consent processes in your organization, including.
Clarity on Gaps in Your Current Solution
Gather insights into the state of your current system and where you think it’s falling short of your expectations. Ask yourself:
- Why are you changing or upgrading to a new system?
- What are the limitations of the existing system?
- Can it support large-scale growth across countries?
For example, if you want to expand internationally, your old system may be inadequate due to a change in data privacy regulations.
Clarity into Your Current Data Processes
Audit all the touchpoints across geographies where data is collected, processed, stored, and shared. Map all the internal processes through which data flows, bringing all the relevant stakeholders—marketing, operations, legal, and customer service personnel on board.
Also, identify all the third parties, such as agencies and analytics personnel, who may have access to the data. Customer audit data is vital when assessing a need because finding the right vendor will depend more on your needs than the platform’s functionalities.
Clarity on the Goals for Data Collection
Collecting massive customer data—even with consent—is never the end goal.
What are the goals or motivations for the collection of data? For instance, personalization, monetization, or even boosting programmatic advertising with high opt-in rates. How and why you collect data should be based on your unique business needs. Identify any processes that can be changed or upgraded to support that.
Clarity on the Regulations Governing Your Business
Can the current system manage multiple geographies? How will your expansion plans be impacted by changing the privacy regulation landscape? Do you need a system that complies with various language requirements?
This information lets you identify your consent needs and a vendor who meets your privacy strategy. Now you can use the following questionnaire to vet vendors and find the perfect solution for your business.
Step 2: Ask These Questions to Choose the Perfect Vendor
Considering your business needs and the platform’s functionality, these questions will help you determine whether a vendor is a proper fit.
1. How Well Does the Platform Integrate with Your Existing Tech Stack
Your tech ecosystem includes CRM, accounting systems, customer service systems, billing systems, website tag managers and cookies, analytics platforms, etc.
These systems require access to the most current version of opt-in data. How well will the new platform integrate with these systems to ensure synchronized data flow when deployed?
Nothing can be more frustrating to a customer than sharing consent preference inputs but still encountering communications that don’t reflect their choices. If customers modify their preferences or opt-out, all systems must remember this to ensure a smooth experience.
2. How Complicated Will the System Deployment Be?
You have heard it said before, “complexity breeds confusion.”
The saying holds regarding deploying any software program, including consent management platforms. With the rapidly changing data privacy laws, there’s no time to be lost in complex processes and procedures.
How fast can the system be deployed across digital and non-digital touchpoints and geographies and ensure smooth operations without leaving the business vulnerable to risks? Opt for a platform that is easier to deploy and modify should there be a need for changes down the line.
3. How Will the Platform Address the Evolving Privacy Laws?
According to a recent UNCTAD report, 137 out of 194 countries have implemented some form of data protection laws.
These regulations keep evolving as data collection techniques get complex and the need for data privacy grows due to ever-increasing cybersecurity threats. In the US, data privacy laws vary by state and keep evolving.
How agile and flexible is the system so your company is always ahead of the changing laws? Look for features such as dedicated managers who can provide legal expertise when needed. These specialists should also help manage global privacy regulations that may impact your business.
4. Does It Help Capture Consent Metrics?
How well does the platform capture consent data and preference metrics?
The best consent management platforms allow businesses to monitor the metrics that matter when it comes to user privacy.
Granular insights and useful analytics on intuitive dashboards allow business owners to make better data-based decisions.
5. Does It Provide Advanced Compliance Alerts?
One of the top reasons for investing in consent management platforms is to stay compliant with the governing data privacy laws.
To that end, your consent management platform should have a system for displaying basic and advanced compliance alerts to ensure you’re not violating any new or old privacy laws.
Similar to how an antivirus program identifies and flags threats in real-time, your CMP should offer real-time compliance scans and alert your business of any gaps or vulnerabilities. Detailed compliance reports with compliance and security ratings will ensure you don’t lag behind compliance and are always abreast of the latest changes in data protection laws.
6. Can It Be Upgraded to Include a Preference Management Platform?
A consent management solution is enough for most companies’ compliance and consent management needs.
But in a CX-first world, a data privacy solution isn’t enough to increase user engagement and satisfaction. Customer-centric brands also invest in preference management platforms to cater to their customers growing needs and preferences throughout the relationship.
Letting customers quickly change preferences and choose how they want their data to be used can help improve retention and reduce opt-outs.
7. Can Marketers Use the Platform to Improve the CX?
The UI and UX of consent have a significant impact on opt-in rates.
The more flexibility and freedom users have to control the system at various touchpoints, the better the experience. But flexibility shouldn’t negatively impact data flow or back-end integration processes.
For example, how easily can marketers customize the banner appearance and wording to make them more attractive and user-friendly? Are they free to make the banner appearance consistent with the company branding? The more flexible the system is to customize to meet the user’s needs, the better.
Importance of Using a Consent Management Platform
Most, if not all, data privacy regulations require businesses to request consent to collect and share customer data. But compliance isn’t the only reason you should implement a consent management platform. Here are the benefits of using a consent management platform.
1. Build Trust in Your Data Collection
A recent Salesforce study found that 58% of customers are comfortable using their data transparently and beneficially.
Surprisingly, 80% said they left brands because the company used their data without consent. In a data privacy-conscious world, businesses should respect their customers’ privacy by being transparent about how their data is used.
When customers feel that the business is transparent, honest, and looking out for their best interest, it creates a positive experience that leads to loyalty and brand advocacy.
2. Streamlining Operations
With a CMP, companies can create a central repository of compliant consent responses that can be used across departments.
Better still, a consent management platform automates tasks, increasing efficiency and time savings. This frees employees’ time to focus on other essential business tasks.
3. Meeting Your Business’s Needs with Custom-Built Solutions
When it comes to CMPs, one size doesn’t fit it all. That’s why finding a solution that offers flexibility and can help meet your business goals with minimal interference is essential.
The good thing about consent management platforms is that they can be customized and custom-built to meet any business needs.
Incorporating features like the ability to change the banner appearance and language of your consent messaging can ensure you’re getting a platform that matches your company’s branding. Other advanced features, like policy change detection and vendor risk monitoring, ensure you’re always on top of compliance.
4. Improved Omni-Channel Experience
Consent management requires you to collect and manage consent on all customer touchpoints, including website, email, fax, and social media. Using a CMP enables you to provide a seamless omnichannel experience that reflects their needs.
A consent management platform demonstrates a company’s commitment to offering its customers the seamless, personalized experience they want in an omnichannel-connected world.
5. Improve Your Sales Processes
Knowing which customers and prospects and opting in and out of specific engagements can help refine your sales interactions and improve conversions.
This information can help businesses perceive what customers feel about their products. For example, an opt-out should trigger the question; why is this happening? This can allow you to learn from your mistakes and work on them to improve conversions.
Wrapping Up
That’s it! The ultimate guide to choosing the right consent management platform!
What consent management platform are you using for your business? And how would you rate your experience with it? Share with us in the comments section below.
