European e-commerce websites’ revenues decreased due to GDPR

The GDPR increased the risk that comes with email and online display advertising

European e-commerce websites’ revenues decreased due to GDPR. Source: shutterstock.com

Since the European Union’s General Data Protection Regulation came into force, page views fell by 9.7%, while website visits decreased by 9.9%, a study called ‘Regulating Privacy Online: The Early Impact of GDPR on European Web Traffic and E-commerce’ shows. For e-commerce websites in Europe, the results are less damaging: recorded site visits fell 5.6%, while recorded revenue decreased by 8.3%, Ecommerce News reports.

The researchers used data from Adobe Analytics to quantify the impact of GDPR on important economic outcomes for a diverse set of firms. According to them, it’s one of the first of its kind to study the GDPR, whose scale and scope has cost many companies millions of euros in compliance costs.

One of the possible reasons that e-commerce websites in Europe have seen a decline in traffic and revenue is because the GDPR increased the risk that comes with email and online display advertising.

The higher costs of using personal information can affect personalized marketing channels that drive online traffic. Both email and online display advertising rely on personal data in the form of cookies or email lists. As such, the quality and quantity of advertising through these channels may fall
Adobe Analytics

The researchers point to other studies that suggest that email and display ads precede 7% and 3% respectively of visits to e-commerce websites, and that the previous EU privacy legislation reduced ad effectiveness by 65%.

The academics also note that overall website traffic may change, because users become aware of how their information is used. GDPR enforcement brought ubiquitous privacy notices on websites that serve EU users. By increasing the salience of privacy concerns, these notices may have changed user preferences for how much time users spend online and which sites they frequent.

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