Understanding the General Data Protection Regulation (GDPR) is crucial for anyone involved in cold email sales, especially if your audience includes individuals from the European Union. This regulation, which became enforceable in May 2018, sets strict data protection and privacy guidelines. So, if you are a sales professional who uses cold emails, you must understand how GDPR will impact your work. Armed with all the necessary knowledge, you’ll prevent potential fines and avoid damaging your brand’s reputation.
In this article, we will go over everything you need to know about GDPR for outbound sales and cold email campaigns.
Main Takeaways
- GDPR is an important law that protects the personal data of people in the EU. Any business with a cold email campaign in the EU must comply with this law.
- Two of the major regulations relevant to cold emails are that you must be transparent about your data collection and only target relevant prospects.
- Under GDPR, customers have the right to request their data to be “forgotten,” get information about the data you have about them, and learn where you acquired the data.
- If you are not GDPR compliant, you can be fined up to 20 million euros!
What Is GDPR?
The General Data Protection Regulation (GDPR) is a law created by the European Union to keep personal data safe. The primary purpose of GDPR is to give people more power over their personal data and set strict rules for how companies can use this information.
Key Features of GDPR
Complete Protection Standards: GDPR sets clear guidelines for handling personal data, including its collection, processing, storage, and sharing. Its goal is to protect individuals’ privacy by carefully regulating the use of their data.
Replacing Outdated Laws: GDPR replaced the older Data Protection Directive 95/46/EC from 1995. It brings in stronger, more up-to-date protections for personal data, significantly changing the landscape from laws first made in the 1990s.
Applicability Beyond EU Borders: A crucial aspect of GDPR is its wide application. It affects companies in the EU and those outside it if they serve EU residents or handle data about people in the EU. This ensures that personal data is protected globally.
Giving Power to People: GDPR empowers individuals with their data. It guarantees people the right to manage, correct, or erase their data. This means organizations have a big responsibility to respect and protect people’s rights to their data.
Modernizing Data Laws: The introduction of GDPR was a major step in modernizing European data protection laws. It replaced older rules nearly two decades old, bringing them up to speed with the digital age and its new challenges for data privacy.
GDPR and How It Affects B2B Outbound Sales
Here’s a detailed breakdown of how GDPR influences B2B outbound sales.
GDPR Applicability to B2B Data
Under GDPR, personal data encompasses any information that can directly or indirectly identify a living person. This broad definition means that B2B transactions fall under GDPR’s purview because they often involve processing personal data, such as contact details of individuals at businesses.
Additionally, GDPR does not differentiate between B2B and B2C in terms of data processing. The same rules apply for personal data protection, regardless of whether the data is collected in a business-to-consumer or business-to-business context.
Impact on B2B Sales Processes
In B2B sales, organizations must ensure they have a legal basis for processing personal data. There are six legal bases under GDPR, and consent is one of them. This means cold-calling, emailing, or using third-party EU lead lists without explicit consent are not viable under GDPR.
When personal data such as an individual’s name, email address, or job title is collected, GDPR protections entirely apply. However, generic email addresses (e.g., ‘sales team’) that don’t identify an individual are not subject to GDPR. It’s crucial to differentiate between these types of data in your CRM and sales strategies.
Data collected for marketing purposes is also subject to GDPR. While there are some exemptions under PECR (ePrivacy), these are limited and require careful consideration. For example, contacts from a Ltd Company within the UK/EEA might be processed differently. We recommend seeking professional advice or training in these areas.
Even if data is collected from public sources like directories or social media profiles, GDPR compliance is still mandatory. So, businesses cannot freely use publicly available data for sales or marketing without adhering to GDPR.
Compliance Requirements for B2B
Companies engaged in B2B sales must establish comprehensive data privacy compliance programs. This includes creating and maintaining documentation, conducting regular audits, and providing all staff with GDPR and data privacy training.
Businesses must also respect and fulfill the rights of individuals under GDPR, such as the right to access, modify, or delete their data. This adds an additional layer of responsibility and complexity to B2B sales operations.
How to Stay GDPR Complaint When Sending Cold Emails
Staying GDPR compliant isn’t rocket science! But some important rules and practices will keep you and your company from facing hefty fines. Here are some of our top tips for staying GDPR compliant.
1. Target Only Relevant Prospects
Under GDPR, the data you collect should be both adequate and relevant to your purpose. This implies targeting prospects who can directly benefit from your product or service. For example, pitching your SaaS product to a company that has reviewed a competitor’s product on a public platform like Product Hunt is relevant, as it aligns with their business needs.
In contrast, indiscriminately emailing every possible address with a generic sales pitch does not meet this criterion. So, segmenting and personalizing your email lists is crucial not only for creating an effective cold email strategy but also for GDPR compliance.
2. Transparency in Data Collection
Additionally, you should be explicit about how you obtained the recipient’s email address. GDPR mandates that businesses handle personal data responsibly, so it’s important to collect only the data necessary for your campaign. When reaching out, clarify why you’re emailing and how recipients can opt out or request data removal.
Remember, it’s not enough to just mark them as unsubscribed; you must fully delete their data if requested.
Tips and Best Practices for GDPR-Compliant Data Usage
- Clear Purpose & Legitimate Interest: Your cold email should have a clear purpose, aligning with the recipient’s profession or role, and ideally should benefit them. For instance, offering a tech manager solutions to streamline their dev team processes.
- Transparency About Sender Identity: Ensure the recipient knows who you are. Your email should clearly state your identity and the company you represent, with a clear signature and links to your professional social media profiles.
- Opt-Out Option: Always provide a straightforward way for recipients to opt out or unsubscribe from your emails, and respect their decision by never emailing them again if they choose to opt out.
- Secure Data Storage: Safeguard any stored email addresses or other data against breaches. Use encryption or secure CRM platforms like Salesforce that offer robust data protection measures.
- Regular Database Updates: Keep your email list clean and updated, regularly removing bounced emails and ensuring those who have opted out do not receive further emails.
- Proof of Data Acquisition: Maintain records of how you obtained someone’s data, especially if the information was shared publicly or in person. This serves as proof of consent under GDPR.
- Double Opt-In Practices: Though not mandatory under GDPR, using a double opt-in process can further ensure compliance and minimize potential issues. This involves sending a follow-up email to confirm the recipient’s interest in receiving further communications from you.
Can You Still Do Outbound Sales in the EU?
Yes, outbound sales activities can still be conducted in the European Union under the General Data Protection Regulation (GDPR), but there are some important rules and regulations to follow.
1. Explicit Consent or Legitimate Interest
GDPR requires you to have explicit consent from prospects with marketing and sales correspondence to proceed with outbound sales. Without explicit consent, your outreach must be based on a “legitimate interest.”
This means that any prospect you contact should potentially benefit from your product or service. For example, if your solution addresses a specific problem the prospect faces or aligns with their business activities, this could be considered a legitimate interest.
2. Data Disclosure Statements
When contacting prospects, we recommend including data disclosure statements in your communications. These should explain where and why you obtained a prospect’s data.
For instance, you might say, “I’m contacting you because I saw on LinkedIn that you are attending Dreamforce this week, and you’re a Salesforce customer. At Company X, we help startups with Salesforce setup.” Such transparency will help you stay compliant with GDPR’s legitimate interest clause and give your outreach a “human” tone.
3. Understanding Recitals in GDPR
According to Recital 47 in the GDPR, “the processing of personal data for direct marketing purposes may be regarded as a legitimate interest.” This suggests that contacting people without explicit consent is permissible under legitimate interest, but you must ensure these contacts fit your customer profile and have a relevant reason to be contacted.
You cannot send random emails to a list of contacts bought or obtained without specific criteria.
4. Rights of Data Subjects
Under GDPR, individuals whose personal data is processed for direct marketing have specific rights, including erasure, rectification, the right of access, and restriction of processing.
This means they can request access to their data, ask for corrections, or even ask to be forgotten and have their data removed from your systems. You are obligated to comply with these requests.
5. Informing Data Subjects About Their Rights
When you contact someone for the first time, you must inform them about their rights under GDPR. This includes information about the identity of your company, contact details of the data protection officer, what their data will be used for, the categories of personal data you have (like full name, email, job title), how long you will store their data, and the criteria used to determine this period.
What Happens If You Are Not GDPR Compliant?
When you’re not GDPR compliant in cold email sales, there are several penalties and risks you may face:
1. Financial Penalties
Level 1 Penalties (Up to €10 million or 2% of annual turnover)
These penalties are imposed for violations like:
- Not properly obtaining consent for processing data of individuals under 18 years.
- Lack of secure mechanisms to protect data, information, and communication of users.
- Inadequate security measures or failures by data controllers.
- Violations of the specific obligations assigned to data processors under GDPR.
Level 2 Penalties (Up to €20 million or 4% of annual turnover)
These more severe penalties are for violations including:
- Processing personal data without proper authorization or consent.
- Failing to obtain explicit consent from users regarding their data.
- Not clearly informing users about their rights concerning their data.
- Transferring personal data to third parties without the user’s consent.
2. Operational Risks
EU regulatory bodies, such as the ICO in the UK or CNIL in France, have the authority to enforce GDPR and can take actions like:
- Temporarily shutting down a business until it can demonstrate compliance.
- Data subjects (individuals whose data you’re processing) also have the right to sue for misuse or mishandling of their data. This could lead to legal proceedings if someone files a complaint against your cold emailing or calling practices.
3. Other Consequences of Non-Compliance
- Non-compliance could increase vulnerability to cyberattacks, leading to data breaches and potential theft of sensitive information, including trade secrets.
- Clients, customers, and employees may complain if their data isn’t handled in a GDPR-compliant manner. This can result in disputes or negative publicity.
- Data protection authorities may audit your business, especially if your public communications seem non-compliant. Failure to demonstrate compliance can result in hefty fines.
- Some countries may impose criminal prosecution and fines for non-compliance.
- Non-compliance might disqualify you from participating in public tenders or working with clients who require GDPR compliance.
- Non-compliance can damage your business reputation, particularly among clients concerned about privacy.
The consequences of non-compliance extend beyond just financial penalties and can impact the overall operations, reputation, and legal standing of your business. Prioritizing GDPR compliance is not only a legal necessity but also essential for maintaining customer trust and business integrity.
Navigating the GDPR Landscape in Cold Email Sales
If you take one thing away from this article, let it be that GDPR has transformed the cold email sales landscape. GDPR compliance isn’t just about avoiding penalties; it’s a chance to refine sales processes, prioritize quality leads, and build more meaningful connections with potential customers.
Understanding and adhering to GDPR guidelines is both a legal necessity and a strategic advantage. Sales teams embracing these changes will likely see improved efficiency, higher-quality leads, and stronger customer relationships!
References
https://www.wired.co.uk/article/what-is-gdpr-uk-eu-legislation-compliance-summary-fines-2018
https://measuredcollective.com/does-gdpr-apply-to-b2b-data/
https://seersco.com/blogs/gdpr-non-compliance-penalties-all-you-need-to-know/
https://www.gdprhandbook.eu/consequenses-gdpr