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CRM Systems and Privacy – Potentials and Pitfalls

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CRM-systems have been around for many years in many organizations and few would argue against the benefits of having everything from internal contacts to data on customers, orders and business partners easy accessible and actionable in one system capable of providing insights and structure. However, data needs to be current and accurate in order for your organization to benefit from it. Issues of data management are also of great importance from a data privacy perspective, a perspective that may not be easy to reconcile with the full potential use of a CRM-system.

Under the EU General Data Protection Regulation (GDPR), expected to enter into force in 2018, with, its stricter rules on consent and information on personal data processing this, will become increasingly difficult. In fact, many organizations could find it more cost efficient to scrap their old data and start with a clean slate, as opposed to tracing back and assessing in retrospect from where the data was collected and for what purposes, if valid consent was given, and if stated purposes and consents cover the anticipated future processing.

So how can customers’ personal data be easily collected and processed while at the same time addressing privacy concerns and complying with stricter privacy regulations? One solution could be the creation of a customer club or other forms of associating with customers under specific terms and conditions, such as on a social media platform.

A key issue here is respecting the customers’ privacy concerns by carefully drafting and amending T&Cs so that they at all times cover the intended data processing. This means explaining the purposes and details of the processing in plain and understandable language so that customers understand what their personal data will be used for. Naturally, the same applies if interacting on social media. Here it is important to remember, that just as the platform has got its T&Cs, your organization needs its own platform-specific T&Cs before it is set to start gaining new customer insights.

Finally, three things to keep in mind to benefit from customer data in the future:
1) make sure that your CRM-system provides sufficient data management possibilities to comply with the GDPR,
2) make sure that all information relating to the processing of personal data is transparent and understandable, and
3) make sure that providing personal data offers added value back to the customer.