This article is part of a series of articles on data ethics. Read more.
Need to know
- The 2018 Facebook and Cambridge Analytica scandal demonstrated how the current data model is broken and how little control individuals have over data shared with third parties
- An online poll conducted in March 2019 among 2,122 U.S. adults showed 58% of respondents think the privacy threat has become a crisis and companies should be forced to change
- The EU’s General Data Protection Regulation (GDPR) is helping rebalance who controls personal data, while the emerging Personal Data Economy promises a more ethical approach by empowering individuals with their own data
- The Personal Data Economy relies on first-party data being owned and shared by consumers, directly with brands. This enables greater understanding of customer needs which can boost innovation and personalised marketing
- An alternative approach is to put informed consent of first-party data at the heart of every touch point on the customer journey – the murky area of selling data to third parties and buying profiles to target consumers is over
- In this context, the value exchange is transparent – customers trade their data with companies for a particular benefit i.e. personalised offers, discounts, exclusive invites
- What this new privacy-focused world means for marketers is the need to understand a new era that hinges on trust and value, where no data should be used without explicit consent
- Data shared direct from individuals also has a power that information from no other source can match – namely that it is verified, 100 per cent accurate, and rich in both depth and time
- Informed consent means a shift from the ineffective ‘spray and pray’ approach to consumer targeting to a more considered effort
- The Personal Data Economy holds the promise of non-creepy personalisation because the individual is in an equal relationship with the brand, one based on transparent data use, informed consent – and mutual benefit
- This move to greater transparency is critical. An ODI report found that 94% of British consumers said trust was important in deciding whether to share personal data with companies or apps.