Marketing Data Is Hanging Out There ‘Like’ Ripe Fruit
The storm raging around Facebook and the supposedly unauthorized use of data from 87 million members of its digital community by the British firm, Cambridge Analytica, is hardly surprising. That this data, scraped from Facebook’s files, was used to support Donald Trump’s election campaign just adds thunder and lightning and moves us one step closer to Big Brother not only watching us, but influencing our lives.
That Mark Zuckerberg, Facebook’s co-founder and CEO, in two days of difficult testimony before the U.S. Congress this week had no reservation to say, ”We have made a lot of mistakes in running the company,” is no surprise either. The data genie has for some time now been out of the bottle and it is not going back in, no matter what Congress or Facebook manage to do to tame the beast.
Those of us in the business of tailoring promotional messages to tightly defined targeted prospects are likely to have a certain "and then what" attitude to all this (possibly even with just a smidgen of admiration for Cambridge Analytica, if its magic algorithms really work as advertised: no, certainly).
Like many of you, my day job, for more years than I like to mention, has been to find imaginative ways to sell things direct to consumers using all kinds of data to identify and communicate with the most likely prospects. It is no bad thing that the issue of just how private or public the data we have shared with Facebook and other digital friends has belatedly leaped into the headlines. The $42 billion plunge in Facebook’s share value over the first few days of the discovery certainly signals that the data issue is a serious one, crying out for resolution, and investors are getting nervous.
Writing on his daily blog for the New York Times, David Leonhardt says that Mark Zuckerberg sees himself as “a kind of enlightened despot.” He points out that while Zuckerberg says his only interest is in what’s best for Facebook users, this can conflict with his obligation to deliver the biggest bang for the investors’ bucks.
“So what happens when Facebook’s business interests and society’s broader interests aren’t aligned?” he asks. “I think the solution to these problems is clear in broad strokes — if still very uncertain in the details. Facebook, along with other huge technology companies, need stronger government oversight. Zuckerberg, to his credit, comes close to acknowledging as much.”
Before everything had grown to mega-scale, the problem was always who had the data and could it be used for marketing? When I started in this business, it wasn’t even called "data:" We had a bunch of mailing lists that had been collected, mostly from people who ordered a product for delivery, rented a television or joined an organization. I remember how proud I was when I got hold of the list of alumni from my university.
What I was certain would be a winning mailing to them returned not a single order, but one letter demanding that no further mail be sent to that person.
We know (although the public is becoming more aware) that what was then an unsophisticated industry of people ordering through the post has, along with the use of computers and advanced data technologies, grown into a huge, highly sophisticated (some might say too sophisticated) component part of the communications industry. The seller wants to know as much as he can about each person; not only the obvious demographics, but increasingly the more important psychographics, the emotional triggers that influence buying decisions often without the individual even knowing it. The seller wants to vacuum the web for the latest data. Total digital media spend increased from $16.9 billion and 6 percent of total media investment in 2007 to $83 billion and 36.7 percent in total media investment in 2016, according to eMarketer.
The now-removed CEO of Cambridge Analytica bragged “of being able to parse and influence the electorate through 'psychographic' algorithms derived from that data,” wrote The New Yorker. After Trump won, Alexander Nix, the head of Cambridge Analytica, crowed that the company’s psychographic algorithms had carried the day. His chief technical expert said: “We would know what kind of messaging you’d be susceptible to and where you are going to consume it and how many times we are going to have to touch you with it to change how you think about something,”
“What’s the currency of the world now?” quoted The New Yorker of a leading consultant. “It’s not gold, it’s data. It’s the information.” Collecting and using data has become an essential part of the marketing business. Orwellian or not, that has become a reality.
Netflix knows what movies you like just as Amazon knows every purchase you have made and every item you have looked at. Your travel, your choice of clothes, the type of restaurants you like, the frequency of visits, the friends with whom you exchange chat and pictures are all now out there on the web. While many companies promise you privacy, few can guarantee it. If Equifax or even the security services of the U.S. government can be hacked and the data stolen, confidence that your data is safe may be more optimism than realism.
You and the availability of your data are something of a simple trade-off.
If you don’t want Netflix to stream movies to you when you want them (and even to suggest others you may like based on those you have seen) nothing obligates you to subscribe. If you don’t want to have your groceries or that 50-pound package of dog food delivered, no problem.
The choice belongs to each one of us.
The price for the convenience of the digital benefits is that you will always be giving up data about yourself. Some database out there will know you have a dog, the kinds of groceries you like (and can guess with accuracy the size of the family), how many and which types of films you choose and on and on and on. And there is no way you can ever get it back.
We tend not to think about any of this when we fill in the coupon or complete an order form. And until we get used to it, we can’t understand how the merchant from whom we recently purchased something knows to put ads for similar items next to the emails flooding our inboxes.
Remember that data is the fuel that powers today’s marketing engine and your data is the low-hanging fruit for marketers. Don’t expect them not to harvest it, to their benefit and yours.
Peter J. Rosenwald is an expat American living and working in Brazil; founder and first CEO of Wunderman Worldwide, International Division of Wunderman agency) and first chairman of Saatchi & Saatchi Direct Worldwide; strategist and senior executive in charge of building subscription and data-driven marketing for Editora Abril, Latin America's leading magazine publisher; founder of Consult Partners, active strategic marketing consultancy working in Brazil, U.S. and U.K. International keynote speaker on data-driven marketing and author of "Accountable Marketing" (Thomson), "Profiting From the Magic of Marketing Metrics" (Direct Marketing IQ), and "GringoView" blog author for Brazilian Huffington Post. With an international perspective, my blog's purpose is to share my maverick views of this business I've spent the last half-century working in, enjoying and observing.