Business

How Does Personal Data Affect Businesses?

Businesses of all sizes collect, store and use personal data. As well as employee records, businesses process data from their customers. Every time someone purchases something online, interacts on social media, or signs up for a newsletter or other free content, they share data with a business. Here are just a few ways that personal data affects how businesses operate.

Businesses must comply with laws relating to personal data

There are various laws that govern how personal data should be stored and how it can be processed. Key examples include the EU General Data Protection Regulation (GDPR) and the California Consumer Privacy Act. Businesses that handle personal data should ensure their policies comply with the rules, which have been introduced to give consumers more control over their data. Companies which breach the laws that apply in their jurisdiction can face penalties. As an example, the maximum fine available under the GDPR is €20m.

Personal data gives businesses a valuable resource

Companies are often required to share the personal data that they collect to meet their regulatory obligations (for example, in the financial services sector). However, beyond this, personal data is a highly sought-after resource that companies can use to generate additional income. Advertisers, for example, will pay for data so they can build up profiles of their targeted consumer base. In fact, data brokering is a new and growing sector, with companies specialising in acquiring, aggregating, and selling large amounts of personal data.

Businesses must stay on top of IT security

Businesses that collect and store personal data must be mindful of the security issues. Suffering a data breach can impact a business in several negative ways. The organisation may face a sizeable fine from regulators; suffer short-term negative PR if the breach is covered by the media; and experience long-term customer distrust and reputational damage. So, maintaining robust, up-to-date security software and protocols is vital.

Personal data helps businesses build detailed profiles of their customers

Businesses can now build up detailed profiles of their customers via the data they collect. When it comes to the category of “personal data”, it is divided into personally identifiable information, such as email addresses and phone numbers, and non-personally identifiable information, such as demographics. Along with the other types of data businesses collect (engagement data, behavioural data, and attitudinal data), they can assemble a comprehensive picture of their customers, which can inform marketing campaigns and product availability.

How can individuals protect their data from misuse?

Individuals can protect their online footprint by remaining alert to what personal data they share and the permissions they give businesses to use that data. It is also worth contacting the various data brokers out there to request that any personal data held is removed from their databases, a process which can be facilitated by a data removal service. This can lessen the risk of that data being used improperly or without users’ consent.

Disclaimer: The information on this website is provided for general informational purposes only. We make no warranties regarding the accuracy, completeness, or reliability of any content. For more such intersting content follow us @ Biz grows

Denis Ava

Denis Ava is mainly a business blogger who writes for Biz Grows. Rather than business blogs he loves to write and explore his talents in other niches such as fashion, technology, travelling,finance,etc.

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