How Brands Are Justifying an Increased Need for Consumer Data

Privacy and the art of the value exchange

Value is the key measure at the center of the debate. Getty Images
Headshot of Michael Dill

It was Benjamin Franklin who sparked the debate between freedom and security. Back then, it was a robust conversation among our Founding Fathers as they contemplated the laws and direction of this new land.

Today, it’s an even more appropriate discussion as we consider placing surveillance on every street corner in order to keep our citizens safer. After all this time, Franklin’s question remains: What level of freedom are we willing to forego in exchange for safety?

A similar debate is affecting marketers and consumers today. The tension between a marketer’s escalating quest for the precision of personal data is in stark contrast to the individual’s desire for personal privacy. Aside from the risk of data breaches, people are simply not comfortable with their information being used to sell them products they haven’t asked for.

For some brands, the value exchange is clear. For others, it’s hard to rationalize. Yet, nearly all manufacturer and service organizations are jumping into this arena with both feet.

As marketers, we seek the Holy Grail of one-to-one marketing with more intimate and personal dialogue instead of the mass media choices on which we’ve historically relied. For brands seeking more relevancy, agencies looking to demonstrate cutting-edge tools and tech and organizations trying to drive growth with fewer resources, this new frontier of precision marketing is compelling. But to consumers, it’s not always welcome.

At the center of this debate is one key measure: value.

For consumers, what value is worth giving up their personal information? For marketers, what value are they willing to “pay” to acquire it? For some brands, the value exchange is clear. For others, it’s hard to rationalize. Yet, nearly all manufacturer and service organizations are jumping into this arena with both feet.

Luxury hotels will ensure your specific brand of sparkling water is chilled and ready in your room well before check-in. The value of personalization is at the center of this experience. The hotel knows its guests, and therefore makes them feel important, special and welcome. Likely, this is an experience that’s well worth providing some tidbits of data and preferences.

With other situations, the value is convenience. The new Amazon Go stores may enable you to purchase without waiting in line, but the price for that convenience is having hundreds of in-store cameras take your picture thousands of times in order to record what you place in your cart. This level of retail surveillance may be worth it if the value of the convenience is big enough. Though the question remains: Where is that data stored, and how else is it being used to profile people and retarget messaging?

A value that is earning unprecedented levels of personal data access is prediction. Turns out, people will give up a lot of information to know what’s around the bend. If you’re willing to provide deep, personal levels of individual data, family history and good and bad behaviors, you can get a fairly accurate prediction of your future health. For some, gaining an early understanding of their likelihood for dementia, cancer or heart disease is well worth relinquishing the highest levels of information.

What if this personal health data is offered to the world, allowing the comparison and profiling of millions of people with similar conditions to predict more effective treatments?

A valuable and noble endeavor, but what if that health data is also used to sell you a variety of products intended to treat your ailment? Or, if it was shared with your insurance company, triggering increased rates? This clearly raises a question of ethics and intent as well as value. These may be the areas of value exchange we face today, but the real challenge is what’s just around the corner. Where the data hits the fan is in the new generation of tools and technology such as machine learning, artificial intelligence, digital assistants and smart homes.

When machine learning capabilities meet the massive spectrum of personal data gathered by millions of devices in people’s everyday lives, we’ve reached the next transformational stage of data. Consider our TVs. One brand of smart TV has a prompt that states, “Please be aware that if your spoken words include personal or other sensitive information, that information will be among the data captured and transmitted to a third party.”

Imagine watching TV, and during an ad break, you say to your spouse, “Boy, that new Honda really looks sharp. We should think about a new car.” Within five minutes, there’s an ad for that car in your social feeds and more frequent Honda spots on your TV. This would be followed by a direct mail piece and perhaps even a cold call from the local Honda dealer as if following up on a hunch. This same level of data is being collected by digital assistants, connected cars, email and social content, and purchase behavior.

Ultimately, data proliferation is a good thing, and frankly many of us bought into it long ago when we first entered a credit card on our phone, provided our email for 15 percent off or took one of those social media quizzes that was never really about predicting our horoscope.

Data makes marketers smarter, sharper and more effective, whether we use it at the granular level or not. It is changing the way we advertise and the way we buy. But it all comes down to a digitalized version of Franklin’s question: What does a person get for sharing data, the price a brand will pay to get it and the intent and ethics behind the exchange?

This story first appeared in the April 16, 2018, issue of Adweek magazine. Click here to subscribe.

Michael Dill is president and CEO of Match Marketing Group, and a member of the Adweek Advisory Board.
Publish date: April 16, 2018 https://stage.adweek.com/brand-marketing/how-brands-are-justifying-an-increased-need-for-consumer-data/ © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT
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