Personal Data

Leave a comment Posted on Consumption, Foresight, Personal Data, privacy, Reputation, Trust, Uncategorized

How did I get here?

That’s the question I have been thinking through today after I was asked to submit a speaking request form for a conference.  They wanted to know the range of topics I can speak on.  I thought it was as good a time as any to revisit my purpose for wanting to conduct research into the future of consumption in general and why post to a blog.

I’m looking to shed light on the future of consumption because I believe my insights will:

  1. Help businesses prepare and position themselves for the future.
  2. Educate and empower consumers to embrace the future of consumption with intention and awareness, and
  3. Inform policymakers and maybe influence policy.

I’m still forming my thesis, however in the evolving world of consumption, buyers and sellers still come together to exchange value, though the form of value exchange may look very different than traditional transactions.  The foundation for any value exchange between two partiers is trust, and trust is made up of identity and reputation.  The virtual communities and marketplaces are providing new ways of establishing reputation through observed behaviors, values, and skills reported to communities by influencers.

The lubricant of this evolving system of consumption is personal data – and this is what is very interesting to me.  While I have yet to articulate the questions I want to address, I know they revolve around personal data and the interplay of trust, privacy, reputation, and influence.

I invite to you reach out if you have insights or a perspective to share, if you would like to be interviewed as part of my research, or if you would like to collaborate on this project.

Leave a comment Posted on E-commerce, Online advertising, Personal Data

How Much is Your Data Worth?

Did you ever think of your personal data as an asset like your car or home or investments?  If not, think again.  In the data broker industry, everything from personal identifying data to social media data to health data is packaged and sold to the highest bidder for annual revenues of almost half a billion dollars per year. That would be $1.76 for every adult 18 and older in the US.  But what data is sold? Where is it collected? The following infographic from MBA@UNC looks at the business of data brokers, how they get their data, and what they sell it for.

The Business of Data Brokers Infographic brought to you by MBA@UNC

But this is not the end of the story.  Sources of highly detailed and granular information can be very valuable to companies.  

Take the digital advertising market. Google and Facebook dominate the digital advertising market by using your data to allow marketers better targeting options.  They use the personal data they acquire to enhance users’ experiences and provide more personally relevant services. In addition, online platforms allow businesses to market their products/services to selected audiences, and reduce the noise of irrelevant advertising for those audiences by enabling interest-based advertising that is based on users’ personal data and demographic characteristics.

This is a very lucrative market.  In 2014, 2013, and 2012, advertising accounted for 92 percent, 89 percent and 84 percent, respectively of Facebook’s revenues.  Advertising is also a major revenue generator for Alphabet (Google), contributing more than 90 percent of the company’s total revenue within the last decade. In 2015 advertising revenues reached nearly $76 billion in 2015, or $276.68 for every adult 18 and over in the U.S.

Firms not only pay for data-based advertising on online platforms. They are also actively expanding their user databases and analyzing qualitatively the trends on the demand side. This can lead them to increase their market shares by designing new products and services that better suit consumer preferences. 

It is difficult to quantify the added value of such processes for firms. But projections seem to indicate the increasing importance of personal data for private and public organizations. 

It’s estimated that in Europe applications built on personal data can provide quantifiable benefits of as much as €1 trillion annually by 2020, with a third of the total accruing to private and public organizations, and two thirds accruing to consumers. This means a benefit for firms of about €330 billion annually by 2020.

Personal data is the oil that lubricates the e-commerce machine.  How do you as a consumer feel about that?