Data Ownership: Why Big Tech Is Spying on Your Wallet and Why a Data Driven Approach Has Benefits for Both Brands and Consumers
Privacy issues are front and centre in our major economies. Talk of regulation is in the air everywhere; not just in California, where the California Consumer Privacy Act (CCPA) becomes effective on January 1, 2020, or the European Union, where the General Data Protection Regulation (GDPR) went into effect on May 25, 2018. After repeated high-profile consumer data breaches from top-tier companies, consumers on every continent are fed up with so many apparent abuses of their privacy, and something must give.
However, big tech continues to spy on our wallets, so what does privacy really mean? We can opt out and get lost in search engines, but what happens if you do want to have a conversation with a brand? For those customers who want to continue commercial conversations with their preferred providers, how should companies engage effectively, while also respecting the spirit of laws like CCPA or GDPR?
One obvious option for companies is to cut back on unsolicited emails, SMS messages or contact-centre outbound calls. How many unsolicited customer touchpoints are acceptable in a year — 100? Hell no, how about 10? Imagine a world where a marketer gets ten chances a year per customer to offer a deal and hit their revenue targets. In this scenario unsolicited email and text do have a cost – well, not really a cost, but an opportunity revenue problem. If you waste an attempt to convert a customer, you lose a shot at revenue – you lose the “opportunity.” That means every slot is important and “valuable.”
In this new era of privacy primacy, when it comes to contacting customers, B2C companies cannot afford to miss the bullseye, since their supply of Marketing ‘darts’ will no longer be unlimited. My team and I were shocked when a customer of ours, a billion-dollar subsidiary of a Fortune 100 company, informed us they had chosen to voluntarily cap unsolicited emails to customers at 10 per year. While this might appear an arbitrary figure, some sort of self-regulation must happen to respect the spirit of GDPR, CCPA and the like. What is clear is that Marketing will need to be much smarter in future.
First and foremost, data privacy would take a two-page act of Congress to fix. But what if citizens were given private property rights over their data? I will give you my data to use, but I own it, not you. Brands must obligate themselves to keep it private, otherwise they lower its value if there is a breach. And by the way if you use it for ad purposes, etc., then you must pay me. How much? The market will decide.
At the stroke of a pen many privacy issues would disappear. If companies were not capable of protecting the data – they would not store it. If they could not monetize the data after paying each citizen a stipend for using it, they would not sell it. The litigation bar would take care of the rest, as they do for any “injury” lawsuit. I wish I could take credit for this idea, but Andy Kessler said it first, to the best of my knowledge, in his ‘A Better Way to Make Facebook Pay’ op-ed in the Wall Street Journal on April 8, 2018.
Put yourself in your customer’s position. If it is about you, you owned your data, and if you were paid every time your data was used in a perfect Marketing and Pricing environment, would you be upset? How much would I be paid is the logical answer and a topic for another day. But more than likely this is where we are headed. Why? Because our capitalist system is based on private property rights. The government cannot seize your property, especially after you have spent decades, generations, improving your property. 800 years ago, the English revolted against King John and forced him to sign the Magna Carta to protect themselves from just such seizures, via confiscatory taxes.
If everyone was paid for the use of their data, there would be less breaches of security and less vitriol aimed at marketers who use a data-driven approach. The simple answer is let the market hash this out, with a light hand from government regulation. You can see it now, the ads from experts, let me fix your internet dysfunctional Marketing, you deserve more. New ads more popular than for the other dysfunctional behavior the blue pill solves.
However, get the balance right and brands can stop spamming you with useless emails, because they offer insight on what you might like to buy. They can time their approach, so they send you marketing content when you are more inclined to buy.
There are lots of creative ideas on how to fix our privacy and data use issues, government regulations usually being the least effective in the end. Naïve? Maybe? When the heavy hand of government shows up, everyone complains, no one thinks they are responsible for why it happened.