Why It’s Important to Follow the California Consumer Privacy Act Guidelines

What is the CPRA and why is it important to follow these guidelines? How our data is handled by other individuals and businesses is one that we now have more control over. However, the challenge of following these guidelines can be difficult for some, especially if and when these guidelines are reviewed.

In this guide, you’ll get an understanding of what CPRA is and how it’s important for many businesses and individuals that collect consumer data. By following these guidelines and our tips for keeping your business compliant, it’ll make the whole process of handling data a lot easier.

What is CPRA?

So what is CPRA? CPRA is an act that serves as an amendment to the CCPA – the California Consumer Privacy Act of 2018. Whilst the CCPA is still relevant to follow in it’s rules too, the CPRA has been put in place to help redefine and expand on the CCPA to help protect and strengthen the rights of every resident in California.

With this act in place, consumers have an easier job of opting out, as well as businesses being responsible for data privacy management. About 46% of customers feel like they’ve lost control over their own data, so the CPRA is someplace where consumers in California can say: “Do Not Sell My Information in California.”

For many businesses, the act has impacted the work process when it comes to collecting and managing consumer data. It’s likely made it harder for businesses to keep hold of the data too.

Of course, anyone who chooses to opt out from marketing materials or doesn’t want their data stored might not be the right consumers for your business. Nevertheless, it still means a lot of data is being ripped away that could potentially have been a future sale or conversion.

Failure to comply with the CPRA and you or your business will likely face a potential fine or further actions taken against you. Just like the EU’s GDPR, all businesses and individuals have until January 1st 2023 to ramp up it’s compliance to meet the guidelines in place.

Why is it important to follow these guidelines?

Most of the provisions for the CPRA don’t take effect until January 2nd 2023, however personal information collected on or after January 1st 2022 will be part of the “Right to Know” section. This is where businesses will need to let their consumers know what data is being collected on them and how it’s being used.

Not everyone needs to comply with CPRA. In fact, businesses with a total number of consumers of over 100,000 or higher need to comply. For the CCPA, it’s 50,000. As well as having more than 100,000 consumers, you’ll also need to generate at least 50% of annual revenue through selling or sharing consumer personal information. This part of the act is an update from the CCPA.

Whether you’re creating a new website for your business or you’re looking to ensure your existing customers stay with you, following these guidelines is essential.

It seems that whilst many U.S. organizations are hoping to achieve compliance, much like the EU’s GDPR, many businesses are faced with a reality that they’re unable to achieve full compliance before the January 1st 2023 deadline. Regardless, it’s important to do so in order to protect your business from harm.

Here are just a few reasons why it’s essential to achieve that compliance and to follow the guideline set by the CPRA.

Avoids fines that could financially ruin your business

Like the EU’s GDPR, by not following the guidelines or being compliant, your business could be faced with some hefty fines. These penalties for policy violations under the CPRA can be up to $7,500 per violation. That’s a substantial amount of money that many businesses might not be able to afford to lose.

With each violation, it becomes a costly affair that could financially ruin your business. By following the CPRA guide as outlined, there are many businesses who can speak from experience. In 2020 alone, the EU authorities issued a whopping $158.5 million ($192 million) in fines.

For the sake of your business’ finances, it’s a good idea to do everything possible in order to make it compliant. It’s particularly important for those bigger companies who will likely be the first ones that the CPRA focus mainly on when the rules are officially enforced.

Generates more trust in your consumers

Trust is a very important thing for your customers to have in your business. Consumers in general value companies being transparent and honest with how they collect and manage their data.

For some businesses, gaining more trust in their customers might be a priority in order to help retain them for longer. When your customers and consumers in general, are seeing an active effort being made to be compliant, it’s going to positively influence their view of the business.

Image Source

In a study mentioned on Marketing Charts 8 in 10 respondents found that trusting a brand to what it is right, is a deciding factor when it comes to making a purchase decision. Listening to your customers is important. When there’s a need and want to take back control of their data, your business should be taking action.

It could negatively affect your reputation

Whilst there may be difficulty in enforcing these guidelines in time for the deadline, business reputation may also be on the line too. There have been many cases of data breaches on a global scale and cybersecurity threats are more than real in 2021. With that being said, if you’re not making moves to compliance, there’s a real risk of being caught red-handed.

Imagine not only suffering from a data breach but the data stolen or leaked was in breach of CPRA guidelines? A scenario like this, could seriously impact a business’ reputation and the future of that business too.

Reputation, much like trust, is an important factor when it comes to consumers choosing where they spend their money.

As part of the CPRA, it created a new enforcement agency to investigate those who aren’t compliant and have enforcement and rulemaking powers. There’s really no getting out of following these guidelines when you meet the criteria outlined above.

Tips to keep your business compliant

Keeping your business compliant, regardless of whether it’s a new one to the industry or existing, is difficult. There’s benefits to it and so here are a few tips to keep your business CPRA-friendly.

Revisit any contracts

There’s a change in your business liability when it comes to violating the law through “third-party” businesses. There are new contractual obligations that need to be in place in order to ensure data isn’t being given away without consumer knowledge or consent.

A good idea to tackle this is by approaching all your contractors and any third-party sources to revisit the contracts in place. Changes will likely need to be made in order to ensure compliance within these contracts.

Label your data efficiently

Labeling data can really help to ensure that your business has an easier time of handling it all internally. A new addition to the CPRA that isn’t included in the CCPA, is additional protection on data known as ‘sensitive personal information’. This includes details like a person’s social security number, genetic data, geolocation, race or ethnic origin, etc.

When the consumer asks to limit a business’ use of sensitive personal information, it’s important to label this correctly so your employees can distinguish between what’s sensitive and non-sensitive information. This can lead to better management of your data so that you don’t get yourself in any sticky situations.

Invest your time into updating privacy notices

Another good way of helping become more compliant with CPRA is to dedicate your time to updating privacy notices. This might be something that features on various parts of your website and when signing up for email marketing and other marketing materials.

By identifying and updating these notices and policies that your business has in place currently, can contribute effectively to your efforts.

The CPRA won’t be the last amendment you see

It’s important to realize the CPRA amendment is likely to be one of many that appears over the years. This is by far not the last amendment that you’ll need to adapt to as a business. With that in mind, a willingness to change and cater to these amendments is needed. It’s essential for your organization to remain compliant, regardless of what’s thrown your way.

Focusing your attention on CPRA compliance now will help avoid a lot of issues in the future. With a deadline approaching fast, you’ll be grateful that you made the changes now instead of leaving it to the last second.

Author Bio: Natalie Redman (LinkedIn). Email – natalieannredman92@gmail.com. Freelance writer for many clients across multiple industries. Natalie has two years of copywriting experience. Natalie has a wide range of experience copywriting for web pages for businesses across many industries. She’s also an owner of two blog websites and a Youtube content creator.