Access to consumer data is increasing but its use by businesses is becoming more opaque, a point underscored by a series of breaches and scandals last year.
Despite the access many brands still struggle to deliver the high level experiences consumers now expect. It is a dangerous game for brands with more informed and often demanding consumers.
That’s the view of Ben Sharp, Pureprofile head of revenue ANZ, who argues data quality and comprehension is just as important as access.
He told Which-50 the revelations of data misuse in 2017 had an impact on consumers, whose understanding of the value exchange is improving.
Earlier this year, Pureprofile surveyed consumers following the Cambridge Analytica scandal to gauge their perceptions on data use.
Nearly half (48 per cent) said they were concerned about how their data was being used and intended to make changes to their privacy settings or how their data was shared. Not all users followed through but the scandal did have a significant impact.
“What actually happened is that 26 per cent of Australian users that we surveyed did actually change or close their facebook account.”
A more opaque exchange
Separate research on attitudes to data use suggests consumers are more aware than ever of the value exchange for using online services and social media. But they are also increasingly unhappy with the deal, with concerns around exactly how the data is used and who is using it.
Arguably the world’s biggest data wrangler, Facebook, has been rocked by a horror year that exposed the social media giant’s failings around data security and privacy.
In Australia new regulations have forced organisations to fess up when data breaches occur. But the collection and use of data remains murky, according to Sharp.
“It is a very opaque way in which data is being used,” he said.
But it hasn’t always been so unclear, Sharp says. When he founded Allure Media in 2007 the value exchange between users and brands or websites was well understood.
“Consumers knew that they could come to our website, they could read content in a particular area and we would serve ads to them which were relevant to the part of the site that they were actually on,” Sharp said.
“Consumers understood that they didn’t have to pay to read the site and that they were seeing ads that allowed them to view a website for free.”
Fast forward to today and it is a “vastly different story”, Sharp says, particularly when it comes to social media. When consumers sign up to facebook and connect apps they are also sharing a huge amount of their data, something they may not be fully aware of.
Few have the resources to fully understand what they sign up for. Sharp says even he, an advertising industry veteran, has not read the entire policy and he expects not many consumers have.
But while the businesses are usually the winners in data for service exchanges, brands are still struggling to effectively use the information, Sharp says.
“There’s so much data that brands have about consumers but there’s also a lot of data that brands have about how consumers interact with them.”
Sharp said there are essentially two ways of collecting first party data. Firstly, intent based data collected by monitoring consumer habits like browsing a website. This “traditional” approach has been useful but fails to complete the picture of consumers, according to Sharp.
Just as important is “declared data” – information obtained directly from consumers about their experiences.
“The difference between those two different types of first party data can really determine and change the way a brand thinks about consumers’ experience and the consumers’ perception of their particular brand,” Sharp said.
The declared data can help close the gap on experiences, Sharp says, as brands can understand exactly what the critical factors were rather than inferring it through intent based data.
“You can suddenly get much richer data about consumers and from the back of that you can then use that data to hopefully deliver a much better consumer experience to your customers that are coming and spending time with you.”
About the author
Joseph Brookes is a writer for the Which-50 Digital Intelligence Unit, of which Pureprofile is a corporate member. Our members provide their insights and expertise for the benefit of the Which-50 community. Membership fees apply.