How the Digital Services Act affects consumer experience

Most of the press surrounding the EU’s Digital Services Act (DSA) has been focused on its impact on VLOPs or “very large online platforms.” And indeed, platforms like Amazon, Alibaba Express, Facebook, Google, and the like bear the greatest potential liabilities under the law. But what’s forgotten most of the time in that the DSA affects your own brand experience as well.

If your brand advertises online or runs a small online store, your business will be impacted directly or indirectly. It makes sense to educate yourself now on how this law affects all digital marketing—in the eurozone and globally. Because DSA compliance not only protects consumers, it can also allow your brand to stand out in a positive light.

Don’t just comply—embrace

First, we have to accept an important truth: The DSA is something that consumers truly want. It curbs the abuse of algorithmic matching of content to individuals; prevents ad targeting based on race, ethnicity, sexual orientation, or political beliefs; bans the posting of illegal products, services, and disinformation; increases transparency on how and why you were targeted; severely restricts marketing to minors; and holds platforms severely accountable for enforcement.

No matter how you look at these restrictions and the penalties for non-compliance, from a consumer perspective they’re positive moves. “You’re protecting my kids, protecting my privacy, and protecting my rights? Sign me up!” What consumer wouldn’t want these things? This is why I believe we have to do more than simply obey these regulations—we need to embrace them wholeheartedly, simply because they create better and more meaningful brand experiences.

Our first question to any ad platforms we work with should be, “What are you doing to maintain DSA compliance, and will this apply to all of your operations around the world?” Even though advertisers themselves are not liable under this law, nor is the DSA applicable to your marketing outside the eurozone, it’s your brand reputation associated with any consumer outcries that may arise. People aren’t thinking this is Google or Amazon’s fault that they received an invasively targeted ad. They only see your product. Ensuring the ad platforms you use are complying is essential for protecting your brand in a world that’s increasingly demanding greater privacy protections.

Consider your AI liabilities

The recent fascination with artificial intelligence (AI) is another area where DSA compliance is essential. The AI space is both challenging and exciting. But we must remember that AI is simply an evolution of the algorithms and predictive learning systems specifically covered under the act. Your use of AI technology, no matter how cool, falls squarely within the DSA oversight  and always needs to be evaluated through that lens.

If you’re using AI for targeting, you need to be transparent about it with consumers. Whether you use disclosures or creatively weave this fact into the ad itself, you need to be ready for consumer questions about why you chose to target them. You also need to have a clear method for users to opt out of such targeting on your website or marketplace.

What’s more, when you use AI to directly interact with consumers, it is imperative that you monitor these interactions closely. As smart as these systems are, they have been known to stray into troubling territories. And as of February of 2024, smaller online platforms—including chatbots and dynamic page engines—will join the VLOPs in needing to comply with the DSA. Automation is fast and addictive, but human oversight is crucial for ensuring your system isn’t spreading disinformation or otherwise acting illegally.

A pragmatic footnote

Now, having said all of this, we also need to keep a few pragmatic thoughts in mind. As scary as the restrictions within the DSA may appear, the law is not designed to target smaller marketplaces. In fact, the act specifically carves out multiple exceptions for online platforms and services with fewer than 45 million monthly active users. Furthermore, the legislation provides for hiring 230 additional regulatory staff members—a number most analysts consider woefully inadequate to police the world’s largest technology companies, let alone monitoring your brand’s online store.

But this is all really beside the point. Whether you think you’ll get caught ignoring these regulations or not, the law exists because of consumer demand. And this demand is not bound exclusively to the eurozone nor expected only from the largest platforms. That’s why I maintain that adherence to the DSA is predicated by commonsense, rather than by the law itself.

With consumer trust of brands and their marketing messages at all-time lows, it’s time for brands to listen to consumers. If people want greater transparency into our targeting efforts or greater protection against rogue messaging, then let’s give it to them. Let’s build greater trust before we hyperpersonalize. Let’s earn their permission before we market to them. And let’s treat people with the dignity and respect they deserve. It will only benefit our brands in the end.

Tim Ringel is a cofounder and global CEO of Meet The People.

https://www.fastcompany.com/90966109/how-the-digital-services-act-affects-consumer-experience?partner=rss&utm_source=rss&utm_medium=feed&utm_campaign=rss+fastcompany&utm_content=rss