As we enter the personal data economy, marketers must make consumers' data a priority - improving their understanding and capabilities to create greater value for customers as well as the business, says Ben Silcox, Chief Data Officer of AnalogFolk's new data intelligence arm, AnalogFolk DNA.
"We retarget the arse out of the internet."
Clear, concise and blunt. I've heard this constantly over the past few years but it still takes me aback. My mind instantly fills with the jeans, makeup and headphone brands who’ve retargeted my arse all over the internet for the last six months – despite having purchased the items months ago, my computer is still eating their cookies.
That said, in a strange way, it’s refreshing to hear the honest intent from businesses on how they’re using data. In reality, most companies are no better than hackers in exploiting technology that is hidden from the view of consumers.
We are entering a growing ‘personal data economy’. The lack of understanding, capability, ownership and prioritisation, at both marketing and board level, are widespread barriers if businesses are to thrive, grow, and innovate.
So what’s really the problem?
There were more than 283 unique advertising-tracking technologies used in just one quarter last year (Evidon Ghostery 'Global Tracker Report'), creating almost double the number of cookies used for advertising than analytics on the most popular websites in 2015 (40 to 26 comScore).
The irony of this self-interested behaviour is clear: while 73% of programmatic digital inventory is sold below $5 CPM (cheap), viewing of those ads is around 35% (worthless). There’s literally billions of pounds being chucked away due to the unregulated and infinite inventory of ads and websites on which brands advertise. Recently Business Insider reported that more than $7bn will be spent this year on fraudulent impressions.
While brands and their partners are capturing ever-more data across ever-increasing sources for use in creating value for themselves, the winds of change are blowing in the real world.
in a consumer privacy study by the University of California, Berkeley, 60% of those interviewed said they wanted a ‘Do not track’ law. Going further, 40% believed websites with advertising were selling their data. The increase in hacking (everything from VTech and T-Mobile to Carphone Warehouse and Ashley Madison), growth in data privacy breaches, increases in identity fraud and downloads of ad-blocking software are all symptoms of the lack of self-regulation, unethical behaviour and lack of transparency relating to personal data.
And you will have to do something about it
This has come at a time where people want honesty and transparency from brands. The number-one thing for respondents to a global survey carried out by global PR firm Cohn & Wolfe was: "communicating honestly about products or services". And although people don't understand everything going on with their data (only 30% have any reasonable comprehension of who is collecting their data ('The Value of our Digital Identity', Liberty Global), they want greater transparency and ‘informed consent’. Indeed, Microsoft found that "83% of survey respondents said they ‘expect brands and advertisers to ask for their permission before they use their digital information".
This quite clear indication of what people actually want is at best misunderstood, and at worst ignored by marketers. To quote Harvard Business Review: "Though some companies are open about their data practices, most prefer to keep consumers in the dark, choose control over sharing, and ask for forgiveness rather than permission. It’s also not unusual for companies to quietly collect personal data they have no immediate use for, reasoning that it might be valuable someday."
And so, as with all exploitation that arises where self-regulation and self-interest collide: legislation will be the answer. Organisations including the Competition and Markets Authority, the European Commission, Information Commissioner's Office, Ofcom, and the Financial Conduct Authority are working on enhanced legislation to inform the governance, storage, transparent privacy and competitive value gained from personal data.
It’s likely that with the European Commission’s Digital Single Market plan, the basis of the personal data economy will be ‘permissioning’ – the explicit use of any data to be stored, held and used with complete transparency by a business, agreed in advance by the customer.
Here is where you can start
For brands and businesses to thrive and compete in this environment, ensuring they are worthy of people’s trust is a priority. Marketers gain this trust only with big shifts in corporate thinking.
First, data ethics and privacy must be prioritised by the board, so that leadership exists to build transparency into the fabric of the marketing function. Marketers must understand that business and data strategy are indistinguishable now. Senior marketers cannot have their heads in the sand regarding how they and their partner agencies use people’s data. Communicating this transparency as part of the brand values and backing it up with actions is not a ‘nice to have’.
The next shift will be a move away from marketing functions organised by channel, to marketing teams aligned to experiences. This requires the ability to co-ordinate communications without the current fragmentation of marketing across channels. Only those creating tangible benefit for the customer experience through data will stand out.
The last major shift needs to be away from a ‘media-first’ approach to a 'value-first' approach to communication. Almost every recent study and survey points to the desire for brands and businesses to play a ‘meaningful’ role, both personally and in society. Understanding how to build experiences on a clear value exchange is a skill missing from many marketing teams. In the personal data economy, you won’t get permission to use people’s data unless you can show a personal, tangible and immediate benefit.
The opportunities for growth from data will increase – but not by talking about ‘customer-first’ while secretly acting like hackers.
Winning in the personal data economy means recognising that value for the customer and business value are flip-sides of the same coin - but without a focus on the former, you won’t get a chance to build the latter. Helping turn my interest in natural makeup into a personalised delivery to our home in March would have helped make a great birthday for my wife.
Simple ideas told well still win, but only when they’re built on trust.