The Impact of GDPR on CRM

The General Data Protection Regulation (GDPR) has significantly influenced the landscape of customer relationship management (CRM) since its introduction by the European Union in May 2018.

Designed as a robust legal framework that’s designed to protect citizens’ personal data, the GDPR has introduced a variety of both opportunities and challenges for companies that are reliant on CRMs for operations and such.

Some of the best CRM providers include:

1. Zoho
2. Pipedrive
3. Monday.com
4. Freshsales
5. Capsule

However, as with anything else, there are plenty of ways in which businesses can (and have had to) adapt their strategies accordingly.

What Exactly is GDPR? 

The intention behind establishing GDPR was to harmonise data privacy laws across the EU region, giving individuals more control over their personal information than they had in the past.

This applies to all businesses that process the data of EU residents, despite where the organisation itself is actually based. Key principles include transparency, data minimisation and accountability, and along with this come some pretty significant fines for non-compliance.

GDPR Has Led to a Shift in the Approach Taken By CRMs

Especially in more recent years, CRM systems have become critical for businesses to manage customer interactions and drive sales too.

But, they also rely heavily on collecting, storing and evetully, analysing customer data, which means that they’re especially vulnerable to GDPR regulations.

Now, under GDPR, organisations are required to ensure that any data stored in their CRM systems is gathered, processed and managed in compliance with the regulations.

Data Collection and Consent

Consent is a major buzzword nowadays when it comes to data collection, especially in GDPR. Nowadays, businesses need to provide a very clear and transparent opt-in mechanism for data collection and any marketing communications, and the approach needs to ensure that customers know exactly how their data will be used.

This means a lot of the norms in the industry need to change. That includes things like pre-checked consent boxes, for instance. These used to be super common, but they’re no longer permitted.

Organisations now also have the burden of having to demonstrate that consent has been given to add a layer of accountability.

Improved and Enhanced Customer Rights and Transparency 

One of the key features of GDPR is transparency. It means that all customers have the right to access their data, know exactly how it’s being used and make requests for corrections and deletions too.

Nowadays, CRM systems need to facilitate these requests efficiently which has led to the integration of various features, including things that allow for editing, quick data retrieval and deletion.

In addition, businesses need to provide privacy policies that are written in language that is easy to understand, not full of complex jargon. This helps foster trust and strengthen relationships between organisations and customers.

Data Security and Accountability

GDPR has imposed strict requirements for data security. For CRM systems, this means ensuring secure access controls, regular audits and robust encryption. Data breaches absolutely have to be reported within 72 hours, for instance, which means that CRM software needs to b able to monitor ad detect any threats.

And, in terms of accountability, there are also more ways in which organisations can (and must) keep detailed records, leading plenty of CRMs to upgrade their systems to include things like reporting features and compliance tracking.

Challenges Introduced by GDPR

There’s no doubt that GDPR comes with difficulties despite good intentions. Small and medium-sized enterprises (SMEs) tend to struggle with the costs involved in upgrading their CRM systems and training staff too.

In addition, having to deal with cross-border data transfers is also very challenging for global organisations.

Going forward, there’s no doubt that data privacy regulations will continue to evolve, meaning that businesses will need to remain agile. Especially since staying compliant with GDPR is an ongoing commitment.

Indeed CRM systems will continue to play a critical role, ad organisations must leverage advancements in technology in order to stay on top of things and be ahead of the game.

What Are the Benefits of GDPR for CRMs? 

There’s no denying that GDPR has introduced a fresh set of challenges, but it’s also offered some new opportunities for businesses to improve their CRM practices.

• Building trust between organisations and customers.
• Improving the quality of data, allowing CRMs to be more effective.
• Compliance with GDPR can be a selling point for companies, providing them with some extra competitive advantage.

As with all other things, it comes down to weighing up the challenges and opportunities introduced by GDPR, but ultimately, it seems to be having a positive effect overall – as long as companies are on their game.