What is the Digital Markets Act, and what does it mean for businesses?
What is the Digital Markets Act?
On March 7, 2024, the Digital Markets Act (DMA) officially came into effect, establishing a new benchmark for regulating Big Tech companies (or "gatekeepers") in the European Union. As one of the first regulatory frameworks of its kind, the DMA establishes clear criteria for identifying dominant digital players and outlines compliance requirements, levelling the playing field for smaller businesses while also safeguarding user rights. At InAcademia, we welcome any initiative prioritising user protection and data security and are committed to providing a seamless, secure, and privacy-first student verification platform.
What are the implications for businesses?
The DMA brings a host of new opportunities and rights for businesses operating in the EU. Here are the main points to factor into your digital strategy:
Restrictions on data usage
A focal point of this new legislation is the restrictions on how gatekeepers can use data, aimed at curbing anti-competitive strategies often adopted by dominant platforms - like data hoarding, below-cost pricing and self-preferencing products/services. The DMA enforces stricter rules on collecting and processing user data, pushing for a more transparent approach to personalisation. With this in mind, businesses are shifting towards 'opt-in' targeted advertising, while ensuring complete transparency about how user data is collected and managed.
Increased transparency requirements
Gatekeepers are now required to be more transparent about their algorithms and ranking systems to help users understand how their data is used. This change necessitates a refinement of communication strategies around advertising, pushing businesses to adopt clearer privacy policies and user agreements. By doing so, companies not only enhance the overall online experience but also empower their users to make more informed choices about their data privacy - a must for converting privacy-conscious browsers to loyal customers.
Focus on third-party data
The DMA also encourages a significant shift toward first-party data, or information collected directly from users. With restrictions on third-party data becoming more prevalent, businesses are urged to instead opt for a ‘quality over quantity’ approach to data collection by gathering minimal information for maximal results. To aid minimisation strategies, companies will need to invest in tools and systems for collecting and leveraging first-party data, whether that’s customer feedback mechanisms or direct engagement strategies. The result will be a website that’s not only tailored to your customers’ shopping habits, but much safer for them to use - a win-win scenario.
How can InAcademia help?
With technology evolving rapidly and reshaping the world of e-commerce, the Digital Markets Act is unlikely to be the last legislation of its kind. So, it’s essential for your business to position itself as a privacy-first leader, and that’s where InAcademia can help. We prioritise data minimisation, significantly reducing the need to collect and store personally identifiable information, like student cards. Our online verification platform provides a faster, secure, and reliable solution, catering to customers who are increasingly concerned about how their data is handled. All to help you stay ahead in an increasingly privacy-focused marketplace.
For more information, don’t hesitate to contact us.