Marketers are turning to retailers and media owners directly collecting customer data. This requires AI-powered ‘data trusts’, with clear tools and templates for those who want to share and use data.
In recent years, consumers have called for more privacy, transparency, and control over how their personal data is used by the advertising ecosystem. In response, data privacy regulators have issued guidelines, policy makers have proposed new laws, and some tech giants have taken advantage of this to review how advertisers can operate with their partners.
Instead of simply reducing data exchange, marketers are searching for more ways to connect, enrich, and activate what they know of their customer base using privacy-by-design measures.
Many are turning to the retailers and other media owners directly collecting data from their customers. Marketers are looking to exchange data with this enormous pool of publishers in a transparent, trustworthy and secure way. This is an ambitious approach that carries a lot of complexity, but ultimately promises to be far more fruitful.
Matching first-party identifiers across various properties has the potential to enable advertisers to not only reach their audience as they would do with more traditional digital advertising tools, but it can also transform the relevance of ads by being based on better and more meaningful insight such as transactions, shopping behaviour and contextual data.
Today, some of the pioneering companies leveraging this first-party data opportunity – retailers like ASDA, Boots and Carrefour – are integrating their customer data platform with others to scale audience targeting capabilities in partnership. But the world produces 2.5 quintrillion bytes of data each day and online shopping is no small contributor. AI support is needed to speed-up, open out and streamline the way brands and retailers collect, process and action data.
This is where we first encounter the concept of a ‘data trust’ between organisations holding data and organisations receiving data whereby the tools, templates and guidance for those who want to share and use data are mandated.
Creating fair value
People are increasingly aware of the role advertising plays in funding the content they enjoy online and are willing in certain circumstances to give consent for their data to be used in a privacy-safe way that enables better online experiences, content and offers. In fact, Criteo’s research among 1,000 UK consumers confirmed most are willing to actively share information, like age (66%) and gender (65%), with advertisers. The UK government’s recent survey of attitudes regarding online data collection, found 72% of respondents were happy for organisations to collect and use their personal data.
While one anonymised individual’s data offers little immediate value to the marketer, consumers are realising the cumulative value of the data being collected by businesses and used to re-engage them with personalised services and offers as they go about their online lives. By agreeing to share something with a brand, consumer expectations are understandably high and delivering experiences based on the value exchange demands new ways of working in the digital advertising chain.
Incentivising new ways of working means establishing what data is worth between organisations. In much the same way as commodities hold value in an exchange, the data companies hold carries a relative value. However, unlike commodities where each buyer is bidding on the same thing, in digital advertising each marketer is bidding based on the relative value to that marketer – often based on access to information no one else has (such as first-party data). Equally, the same bid request for an ad slot will be valued very differently for British Airways or Nike, based on the cost of goods they market.
For a data trust to work, artificially intelligent systems will be needed to constantly and instantaneously grade how much a company’s data is worth for a specific marketer or data recipient.
Trust and AI
The conversation that needs to take place now is how we can feasibly operate such data trusts and what founding principles should exist to govern it, given that a system based purely on AI decision making will behave quite differently to what we’ve seen before.
Realising an effective, fair and transparent ‘data trust’ is a process that has already begun, with several research groups exploring the role of AI as a governing force in the market, helping to determine how commercial value generated will be distributed. This is quite a radical concept as almost everything else we interact with today is led – and misled – by human thought.
We need to remember that such endeavours are not risk free. It is entirely possible that this activity could spawn a ‘black market’, where identity-linked data is shared illicitly. It is important to consider how exchanges might take place only via official channels, fair value is consistently offered and confidence in the market never falters. Further research into the intersection of AI, game theory and economy is needed to ensure these principles can be upheld.
It’s a very exciting time in this respect. The number of companies producing AI based solutions is growing exponentially, from Netflix’s film recommendations and TikTok’s augmented reality experiences to DeepMind’s advances in modern medicine. We’re constantly benefitting from – and experiencing – how AI works, and ultimately enhances value in our everyday lives.
Customer empowerment is the future
Much like our gradual acceptance of the cumulative value of our data, the general awareness of what AI is and what it does could be decisive in ensuring that developments in how ads reach the marketers’ desired audiences, but never crosses the threshold into becoming uncomfortable or ‘creepy’ to individuals.
The future of data is exciting and the possibilities of ways in which it will continue to be used are endless. The more accurate the data, the more value it will hold when traded at its true and fair price. We already use AI in everyday life but with a proper system in place, it has the potential to become a bureau de change of insights and knowledge.