-By Pavel Yurovitskiy, CEO of KIT Global
The Power of Data in the Digital Era
As the digital age deepens across the globe, the power of data has become insurmountable. Businesses of all sizes rely heavily on data to fuel growth, enhance productivity, retain customer relationships, and stay competitive. However, with power comes responsibility – particularly when it comes to the management of data. In India, the Digital Personal Data Protection Act (DPDP) is a strict guideline on how businesses must approach data privacy and presents both a challenge and an opportunity for Small and Medium-sized Enterprises (SMEs). With the act expected to come into force by the end of 2024, the clock is ticking for SMEs to gear up for this monumental digital shift.
Decoding the DPDP Act
Despite the growing awareness, an estimated 60% of Indian SMEs lack a qualifying data protection strategy – which highlights a lack of preparation from the majority. There are many reasons why this could be the case, in particular, there is a lack of understanding regarding the long-term value of data protection. In Tier 2 and Tier 3 cities, investing in data protection may seem like an added burden in comparison to other business priorities such as growth and revenue. However, with the implementation of the DPDP Act, data protection is no longer a case of business priority – it is a legal obligation.
The DPDP Act has been designed to provide a comprehensive framework for data privacy in India. It legally stipulates how businesses must handle personal data, to ensure that the rights of individuals are protected. SMEs have to develop processes to collect, store, and process data securely, while also being completely transparent with customers about how their data is being used. Failure to do so could result in penalties and reputational damage. Non-complying businesses will also run the risk of losing customers or attracting new ones, as 82% of Indian consumers consider the protection of personal data as the most crucial factor in building trust with brands.
The Hidden Opportunity of First-Party Data
The DPDP Act may seem like an obstacle for SMEs, but in fact, it presents a significant opportunity – the gateway to first-party data. First-party data is the information that businesses collect directly from their customers, through their website, app, or loyalty programs. This type of data collation is far more reliable and gives businesses great control over its management and usage. By prioritizing first-party data as KIT Global’s primary source of data collection, I have been able to tap into different global markets and find solutions to their emerging needs.
KIT Global has been working closely with SMEs across India, helping them navigate the intricacies of the shift. Our goal is to enable companies to find innovative first-party solutions through the KIT Global platform, that ensures compliance and enhances customer relationships through personalized, transparent, and secure digital experiences. We want businesses to move away from outdated third-party data reliance. Taking into account that 53% of Indian consumers express concern over their data privacy, I strongly believe that businesses that adopt first-party data strategies will have a competitive edge by gaining trust through transparent, customer-centric marketing approaches.
Data Protection as a Global Standard
The benefits are clear, businesses that adopt the use of first-party data can improve their return on investment (ROI) by delivering more personalized experiences to customers, creating trust, and ensuring compliance with privacy regulations. By aligning their data strategies with the DPDP Act, businesses can build stronger, more transparent relationships with their customer, leading to higher levels of retention and advocacy.
As data protection evolves into a global standard, SMEs will be better equipped to expand into new markets and partner with larger international companies, boosting their growth potential and enhancing their ROI. Brands using first-party data for marketing see a 2x increase in revenue growth and a 1.5x increase in cost savings compared to companies still dependent on third-party data.
Prepare Now to Future-Proof Your Business
For Indian SMEs, the DPDP Act is not just a legal obligation, but an opportunity to future-proof their business. The clock is ticking, and SMEs that take immediate action will gain a competitive edge in the digital economy. Those who delay in compliance risk legal penalties and long-term damage to the reputation of their business. Data protection and implementation is a critical component of sustainable business success. By protecting your data, you are protecting your future.
**’The opinions expressed in the article are solely the author’s and don’t reflect the opinions or beliefs of the portal’**
