GDPR and Lead Generation Companies: Building Trust and Boosting Performance

What are lead generation companies?

Companies that use various marketing and advertising techniques to identify and capture individuals or businesses who express interest in a particular product or service and generate potential customer leads for businesses are so called “lead generation companies”.

These companies then provide their clients with leads, often in the form of contact information or other relevant data, allowing the client to launch focused marketing or sales activities.

Lead generation companies employ a range of strategies to attract potential leads. This may include online advertising, search engine optimization (SEO), content marketing, social media marketing, email marketing, webinars and events, lead magnets and opt-in forms, partnerships and affiliates, and more. To implement those strategies they create landing pages, forms, or interactive tools to capture visitor information and qualify leads based on specific criteria provided by their clients.

It is worth mentioning that according to a market research report on the “B2B Lead Generation Services Market,” market size share for lead generation services is projected to reach USD 33.37 billion by 2027.

This represents a significant market scale, and companies aiming to enhance their performance and market share in this industry need to ensure compliance with GDPR and other regulations.

What kind of personal data does lead generation companies collect, use and process?

Lead generation companies may collect, use, and process various types of personal data depending on their specific strategies including:

Individual’s contact information: names, emails, phones, and addresses. This allows companies to reach out to potential leads and communicate with them.

Demographic Data: age, gender, location, occupation, or industry. This information helps companies understand their target audience better and tailor their marketing efforts accordingly.

Behavioural Data: information on user behaviour, including website visits, page views, clicks, and interactions with online content. Behavioural data helps companies assess the preferences and interests of potential leads and personalize their marketing strategies.

Data form Social Media Profiles: public information available on platforms like LinkedIn, Facebook, Twitter, or Instagram. This data can provide insights into a lead’s professional background, interests, or social connections.

Survey Responses Data: information from conducted surveys or collected responses to specific questions to gather additional data about potential leads. This can include preferences, opinions, or feedback on certain products or services.

Cookies and Tracking Technologies: cookies, pixels, or other tracking technologies to collect data about website visitors’ browsing behaviour, preferences, or device information. This data helps in optimizing marketing campaigns and improving user experience.

On what legal basis do lead generation companies collect personal data?

The most common legal basis for collecting of such a data are:

• Consent, that should be explicit and informed, freely given, specific, and individuals should have the option to withdraw it at any time. This consent is provided by individuals while filling out a form, subscribing to a newsletter, or participating in a promotion.
• Legitimate Interests: sometimes companies may rely on their legitimate interests as a legal basis for processing personal data. This means that they have a genuine and justifiable reason to collect and use the data, and the processing does not override the individual’s fundamental rights and freedoms based on the assessment. Legitimate interests may include marketing purposes, customer relationship management, or business development.
• Contractual Necessity: In the case of a contractual relationship between the lead generation company and the individual, collecting personal data may be necessary to fulfill the terms of the contract.
• Legal Obligations: lead generation companies may also be legally obligated to collect and process personal data to comply with applicable laws or regulations for example to verify the identity of customers, prevent fraud, or fulfill reporting obligations.

Under the GDPR: What are the respective roles of the company selling lead generation services and the company purchasing these services?

Under GDPR, Lead Generation companies can be in the role of Data Controller or Data Processor.

In most of the cases lead generation companies will have a role of Data Controller. This means that in cases like this the company determines the purposes and means of processing personal data obtained through the service and is responsible for ensuring compliance with the GDPR’s principles and obligations regarding the processing of personal data. As a data controller, lead generation companies should also provide individuals with transparency, rights, and privacy protections.

In some of the cases it can act as a Data Processor. This should be a case if the company processes personal data strictly on behalf of the data controller – the company buying the leads.In this cases, the data processor has an obligation to act in line with the instructions from the data controller stipulated in the Data Protection Agreement (DPA) and must implement appropriate security measures to protect the personal data.

Company Buying Lead Generation Service also can have two roles – Data Controller or Data Processor.

In most cases is a Data Controller. This means that it determines the purposes and means of processing the personal data obtained through the service acts from the lead generation company. As a data controller, this company is responsible for ensuring that the processing of personal data aligns with the GDPR’s requirements, must have a legal basis for processing the data, must inform individuals about the processing activities, to respect individuals’ rights, and implement appropriate security measures. Under Joint Controllers Agreement (JCA) client company and a lead generation company should jointly determine the purposes and means of processing personal data, share responsibility for ensuring compliance with the GDPR’s data protection principles and obligations, and outline the specific roles and responsibilities for each party data protection obligation.

In some cases, it can be a Data Processor: This should be a case if it engages the services of another organization to process the acquired personal data on its behalf. This can happen, for example, if the lead generation company outsources certain data processing tasks related to the purchased leads from the company that buys the leads. In such cases, the lead generation company must ensure that the chosen data processor complies with the GDPR’s requirements and that a DPA is in place to govern the relationship.

What measures should lead generation companies and their clients take to achieve GDPR compliance?

At first, it is crucial for both companies to have a comprehensive grasp of their respective roles and responsibilities under the GDPR, considering the service agreement they have already entered.

Second, it is essential for them to establish suitable processing agreements in accordance with the GDPR. These agreements, such as Data Processing Agreements or Joint Controller Agreements, serve to ensure compliance with data protection regulations and safeguard the rights of individuals whose personal data are involved in the lead generation process. The specific type of agreement will depend on the nature of their relationship as defined in the service agreement.

Third, as a Data Controllers they must take regular audits and to be assured that:

–        The processor company’s activities are done lawfully and fairly, which means that there is a valid legal basis for the processing, such as consent, contractual necessity, legitimate interests, or compliance with legal obligations and that individuals are provided with transparent information about the processing of their personal data.

–        Data processors only process personal data for the purposes defined and authorized by the company as the data controller. The data processor should not use the data for any other purposes or disclose it to third parties without the explicit instructions or consent of the controller.

–        The data processor implements appropriate technical and organizational measures to ensure the security and confidentiality of the personal data. This includes protecting the data against unauthorized access, accidental loss, destruction, or damage. The controllers should also ensure that the data processor has proper data breach notification procedures in place.

Fourth, data controllers should work with the data processor to assess and mitigate any potential risks associated with the processing activities in cases when the processing activities carried out by the data processor are likely to result in a high risk to the rights and freedoms of individuals and data controller companies are required to conduct a DPIA (Data Protection Impact Assessment).

Fifth, data controllers must be assured that the processor has a Subject Access Request Policy (SAR’s) or procedure in place and will be assisted by the data processor in responding to requests from data subjects to exercise their rights under the GDPR, such as access, rectification, erasure, restriction, and objection.

By proactively addressing these steps and implementing appropriate agreements, lead generation companies and their clients can work towards GDPR compliance, promoting transparency, accountability, and the protection of individuals’ personal data.

Conclusion

Lead generation companies play a crucial role in identifying and capturing potential customer leads for businesses through various marketing strategies. These companies collect and process personal data, including contact information, demographic data, behavioural data, social media data, survey responses, and tracking technologies.

Under the GDPR, lead generation companies can act as either data controllers or data processors, with corresponding responsibilities and obligations. To achieve GDPR compliance, both lead generation companies and their clients should understand their roles, establish appropriate processing agreements, conduct regular audits, ensure lawful and fair processing, implement security measures, assess and mitigate risks, and have procedures in place to respond to data subject requests.

By adhering to these measures, they can uphold transparency, accountability, and the protection of individuals’ personal data under data protection regulation. This will lead to fostering trust with their audiences and safeguard the privacy and rights of individuals whose personal data is involved in the lead generation process.

Embracing a GDPR-compliant approach will enable these companies to navigate the competitive landscape while upholding data privacy standards in the spotlight.

How can we help you?

GDPRLocal can help you with GDPR compliance by providing guidance, resources, and expertise tailored to specific local regulations and requirements. We can assist you in understanding your roles, obligations, and rights under the GDPR, and give you guidance and support for implementing necessary measures to protect personal data and ensure compliance.

Feel free to reach out to us and we can help you with the following documents, and much more:

• drafting and reviewing Data Processing and Joint Controllers Agreements,
• provide you with Technical and organizational security measures checklist for data processors or controllers,
• conducting audits,
• assessing risks,
• developing policies and procedures,
• training and education to employees, helping you understand your responsibilities in handling personal data.

Take a look at our website, sign up on our portal, schedule a meeting or just seek one of the services offered on the website.