How GDPR Compliance Impacts U.S. Small Businesses and What You Need to Know
If your company advertises on Google, Instagram, collects email addresses on your website, or sends out monthly newsletters, you must comply with Europe’s data protection laws- GDPR, or face penalties. Many small businesses, including some of our clients, are being asked to adopt ‘consent mode’ or have seen ads flagged as a result of these new changes. This blog will walk you through what is happening and how to stay in compliance.
The European Union’s data privacy laws continue to evolve, significantly impacting digital advertising and email marketing strategies, even here in the U.S. In this blog post, we’ll cover:
- What is GDPR Compliance?
- I am a US-based Company, Do I Need to Worry About GDPR Compliance?
- Recent GDPR Compliance Changes
- 5 Steps to Implement GDPR Compliance for Small Businesses
What is GDPR Compliance: The EU’s Data Protection Law
The EU’s GDPR data privacy laws are some of the strictest in the world, and for good reason. The value of personal data is on the rise, whether it be your name, email address, shopping habits, or posts on social networks. Steps are being taken to secure your customers’ online activity, however, as a small business in the U.S., it may be confusing as to what you need to do. If you work with people’s personal data, even if it’s just an email address, you need to know about GDPR and what actions you can take to protect yourself and your company.
In the simplest terms, GDPR stands for General Data Protection Regulation, and it is a European Union law that protects the privacy and security of EU citizens and residents. GDPR applies to any organization that processes personal data or provides services or goods to people in EU countries. Therefore, if your marketing and advertising displays on Google, Facebook, or other social channels in France, Germany, Italy, Spain, or any other EU country, you must adapt your marketing strategies. Whether you are a large company like Amazon or Patagonia or a small outdoor apparel company, you must ensure your business practices adhere to the GDPR policy requirements.
GDPR Compliance Quick Facts:
- GDPR stands for General Data Protection Regulation
- Gives more control to individuals living in the EU over their personal data
- Aims to simplify regulations for businesses that operate internationally
- Adopted into law on April 14, 2016, and became enforceable on May 25, 2018
In today’s data-driven world, your customers want to know you are protecting the data you collect from them, even while they are shopping in your online store from their beach chair on the French Riviera!
I’m a US-based Company, Do I Need to Worry About GDPR Compliance?
Are you unsure if your small business should be worried about GDPR compliance as you operate in the U.S.? Well, do any of these ring true:
- I sell products or services to EU countries
- I advertise online through Google, YouTube, Facebook, or Instagram, and target European countries
- I have a website and collect email addresses
- I send email marketing campaigns
If you answered yes to any of these, GDPR affects your business. If you’re collecting data from EU citizens, even if you’re a U.S.-based company, you are affected by GDPR.
Recent GDPR Compliance Changes
With new enhanced consent requirements, here are some of the protocols you may not be aware that your company needs to comply with:
- Explicit and Affirmative Consent: Companies must provide clear, affirmative consent for each data processing activity. Pre-ticked boxes or implied consent are no longer acceptable.
- Ease of Opting Out: Users should be able to withdraw consent as easily as they give it.
- Detailed Record-Keeping: Advertisers must maintain comprehensive records of when and how consent was obtained. Consumers have the right to request the personal data collected about them, know how it is being used, and can request that it is removed.
Even if you are selling bikes direct to consumers in Spain, they need to know you are looking out for their best interests and protecting their data.
5 Steps to Implement GDPR Compliance for Small Businesses
As a small business, here are 5 steps you can take to implement GDPR Compliance across your website, email marketing, and ads:
1. GDPR Compliance on Your Website
Whether you use Squarespace, Shopify, Wix, or WordPress, you can easily comply with GDPR. One of the first steps is to update your privacy policy. Ensure your privacy policy page is clear and available for website visitors. Your privacy policy should inform your customers of your data collection methods, how data is used, and how someone can manage their preferences.
In addition, you need to allow website visitors to opt in and easily opt out of third-party data collection. As an example, if you use HubSpot or Salesforce, you must declare the third-party cookie tracking and allow a visitor to easily opt out.
Conduct a data audit and identify all the personal data you collect, process, and store. Understand where it comes from, how it’s used, and who has access to it. Then, adopt strong security measures to protect personal data. Regularly update your systems, train employees on data protection practices, and have a plan in place for data breaches.
2. Ensure Third-Party Apps are GDPR Compliant
Once your website is compliant, ensure all third-party apps are GDPR compliant. This includes not only Hubspot or Salesforce, but Google Analytics, Zapier, Constant Contact, Mailchimp, and any apps or plug-ins connected to your website that collect someone’s personal data. More on email marketing apps in a bit!
3. GDPR Compliance for Google Ads
Google has reinforced its commitment to privacy-centric advertising and has made three changes in recent years:
Consent Mode v2: As of March 2024, those using Google Ads must implement Consent Mode v2 to communicate users’ consent choices to Google effectively. Consent Mode v2 adjusts the behavior of Google tags (for things like Google Analytics and Ads) depending on the user’s consent choices.
Migration to GA4: Google Analytics 4 (GA4) is essential, as it aligns with the latest consent requirements. Most Google Analytics users will already be on GA4, as Google has phased out the reporting on the older versions of Google Analytics.
Updated APIs and SDKs: Advertisers using Google’s APIs or SDKs must upgrade to the latest versions to maintain functionality and compliance.
Ask your advertising manager or ad agency if they are working with the latest Google tools, especially consent mode, to allow you to continue serving Google Ads within the EU legally.
Whether in Positano, Italy or in Portugal, the EU’s data laws are in place to protect all online consumers.
4. Advertising Changes on Meta- GDPR Compliance for Instagram and Facebook Ads
In response to regulatory pressures, Meta (parent company of Facebook, Instagram, and WhatsApp) has implemented significant changes:
Less Personalized Ads: Facebook and Instagram users in the EU can now opt for less personalized advertisements, which utilize limited data such as location, age, and gender, instead of extensive behavioral tracking.
Subscription Model: Meta introduced a subscription option allowing users to pay for an ad-free experience. However, the European Commission has deemed the “pay or consent” model insufficient, as it lacks a satisfactory middle ground for users who prefer less targeted ads without paying. More to come on this.
Again, check with your marketing team or ad agency to ensure they adapt their targeting strategies, focusing more on contextual and demographic factors.
5. Ensuring Your Email Marketing is GDPR Compliant
Email marketing remains a powerful tool for small businesses to engage their audience, but under GDPR, it comes with strict rules. To legally send marketing emails to EU residents, your small business must:
- Obtain clear affirmative consent before adding someone to your email list
- Not have a pre-checked box or automatic opt-in
- Inform subscribers of how their email will be used
- Allow a subscriber to unsubscribe easily at any time
- Have detailed records of when and how consent was obtained
- Have opt-in forms that are fully GDPR-compliant, which include lead-generation campaigns that funnel a potential customer into an email sequence
Failure to follow these email marketing guidelines can result in hefty fines and reputational damage, so be sure your email marketing practices are just as privacy-focused as your ad campaigns.
Whether working remotely while living abroad or a permanent EU resident, GDPR offers data protection for all those in the European Union.
Final Thoughts on GDPR Compliance for U.S.-Based Small Businesses
Do not wait for complaints or your accounts to be flagged for GDPR policy violations. Achieving GDPR compliance is not just a legal obligation for small businesses, but a critical component of building trust with your customers. Especially those living in Europe. Here’s a quick recap of action items you can take to be compliant:
- Update your privacy policy
- Implement robust data protection measures
- Ensure all 3rd party apps are GDPR compliant
- Adopt consent mode on Google Ads, and be sure you are using GA4
- Adapt your advertising strategies on Facebook & Instagram
- Ensure your email marketing application ticks all the boxes for GDPR compliance
Remember, transparency and vigilance are key! Regularly review your practices, stay informed about changes, and ensure that your customers’ data privacy is always a top priority. By doing so, you’ll not only avoid potential fines but also foster a reputation for integrity and reliability. GDPR compliance is an ongoing journey, but with the right approach, it can become a seamless part of your business operations.
Here are more blog posts you may want to read next:
- How to Improve SEO and Why It’s So Important
- How to Maintain a WordPress Website and Avoid Problems
- Empathetic Marketing: How to Change Your Messaging During Challenging Times or Crisis Situations
Thanks for reading. Now get outside and enjoy that sunshine!
– Meredith McConvill, Top Rope Media
This is so helpful, Meredith! Really appreciate the simplified breakdown and links you provided.Bookmarking so I can come back to it in the future!
P.S. That office view is AMAZING 🙂
Thanks so much Megan! Wishing we had that office view every day.