In 2023, Artificial Intelligence (AI) is revolutionizing marketing by automating tasks, providing deeper insights into target audiences, and enhancing efficiency. However, while AI is a valuable tool, marketers must tread carefully to avoid potential legal pitfalls, especially in the evolving landscape of data privacy regulations.
The legal framework surrounding AI in marketing is still being defined, with lawmakers struggling to keep pace with AI advancements. However, existing regulations like the European Union’s General Data Protection Regulation (GDPR) and state laws such as the California Consumer Privacy Act (CCPA) apply to AI’s data collection and processing. Additionally, the EU is working on an AI Act expected to become law soon.
Here are five mistakes marketers must avoid to ensure compliance and leverage AI without causing data privacy issues:
- Gathering Data Without Consent: Marketers must obtain user consent before collecting their data. This includes implementing user-friendly pop-ups for data consent, as evidenced by fines levied against Alphabet and Meta for illegal cookie usage.
- Lacking a Comprehensive Privacy Policy: Transparency is key. Marketers must have easily accessible and understandable privacy policies that explain data collection and handling processes to users.
- Failure to Explain Data Gathering Purposes: Users need to know why their data is being collected and how it benefits them. Marketers should be clear about the insights they aim to gather and the value users will receive.
- No Data Deletion Mechanism: GDPR mandates that users have quick access to their data and the ability to request its deletion. Marketers must plan for data deletion requests, ensuring they can comply promptly.
- Lack of Transparency About Algorithm Use: Marketers should strive for transparency regarding AI algorithms’ use. Explainable AI can help users understand how models reach decisions and the safeguards in place.
While the legal landscape around AI and data privacy in marketing remains unclear, these safeguards—seeking user consent, transparent privacy policies, data deletion options, and algorithm transparency—can help marketers maintain compliance with existing regulations and prepare for future ones.
Hasan Saleem, serial entrepreneur and founder of technology and e-commerce startups, currently manages a marketing agency.
