Legislation affecting marketing research and insights companies 

The Insights Association’s legislative work 

The Insights Association (IA) focuses on creating demand for the analytics and insights industry and serves to protect it from legislative, judicial and regulatory bodies. It advocates for the industry's ability to collect, analyze and share data for the purposes of market research and data analysis. In its monthly Fighting for You column, IA offers marketing research and insights professionals legislative and regulatory updates. 

As we prepare to step into 2023, we encourage you to review the various laws and proposals affecting the marketing research and insights industry. 

Privacy and data security

A pressing issue revolving around the consumer privacy and data security sector is the Federal Trade Commission’s proposal of broader rules on privacy and data collection, which would affect many companies that work with data and insights. Many groups, including the Insights Association, Privacy for America and the U.S. Chamber of Commerce, requested and were approved for a time extension to respond to the proposal. According to the article “Congress should drive federal privacy regulation, not FTC, urge data-driven industry groups,” some comments on the proposition argued that “every company in America, small and large, is using data to help them solve everyday business decisions and more efficiently deal with economic challenges like inflation and supply chain shortages.” Howard Fienberg, IA lobbyist for the marketing research and data analytics industry, says IA will advocate for “a comprehensive consumer data privacy bill setting a strong national baseline privacy protection for consumers that would still allow for the vigorous delivery of insights.”

The October Fighting for You column explains proposals that could impact the marketing research industry including Elizabeth Warren’s Health and Location Data Protection Act, which would limit companies from sharing, transferring or selling health or location data, and Kristen Gillibrand’s Data Protection Act, which would result in the creation of a data protection agency to head the regulation of high-risk data practices and restrict the collection and distribution of personal data. 

IA’s November 28 piece focuses on the California Privacy Rights Act (CPRA) which goes into effect on January 1, 2023. In response to the act, Fienberg quotes the warning IA and the California Chamber of Commerce gave to the California Privacy Protection Agency (CPPA) saying, “California businesses are being placed in the untenable position of being required to comply with and effectuate the CPRA starting January 1, without having been provided all of the final regulations necessary to do so. This is hugely problematic, not only as an operational matter, but also as a legal one.” 

Broad requirements: transparency and research participants

In the October Fighting for You column, IA mentioned the Information Technology Industry Council report that offered recommendations for artificial intelligence (AI) systems. According to the report, an AI system is “a machine-based system that can, for a given set of human-defined objectives, make predictions, recommendations or decisions influencing real or virtual environments. AI systems are designed to operate with varying levels of autonomy.” The report is calling for broad transparency requirements within AI systems. 

Broad rules are being requested in other areas as well. The November Fighting for You column establishes that a new legislation in New Jersey would result in insights companies being registered as data brokers. The same column says that federal labor rules could unintentionally classify survey participants as employees. In the November 16 article, IA says they wanted to clarify this by indicating that “research subjects participating in market research are independent contractors, not employees.” IA continues by saying, “Research subjects do not seek to share their opinions as ‘a job’ or proxy for employment, but rather because they wish to share their opinions and have an impact…Research subjects receiving incentives are not employed by the organization or company conducting the research – they are, if subject to any legal status at all, independent contractors; accordingly, they should be recognized as such. Their participation is completely voluntary, and they may opt out at any time.” 

In the same November 16 article, IA says, “Market research participation is far outside the ‘traditional employment paradigm’ and does not conform to ‘the usual path of an employee.’ Participation in research is at best a hobby, one enjoyed only once in a while, with compensation not necessarily even offered…Through their participation, they get to influence or impact the future course of products, services and ideas. The foregoing motivations do not describe the traditional (or even non-traditional) worker contemplated by these proposed regulations.” Many marketing research and insights companies may be impacted by the broad rules being proposed but IA is continuing to ask for clarification within the requirements the Department of Labor and other sectors are introducing. 

What to expect from 2023

While legislations and proposals will continue to be introduced and clarified, it is important to stay up to date to understand the changes occurring and affecting the marketing research and insights industry. 

The information included in this article is not intended and should not be construed as or substituted for legal advice. It is provided for informational purposes only. It is advisable to consult with private counsel on the precise scope and interpretation of any laws/regulation/legislation and their impact on your particular business.