What is Your Data Worth to You?

In today’s world, it is a known fact that data is sold and used to target personalized products, services and offerings to individuals. As consumers, we are constantly being asked to decide how much of our personal data is shared with a company. We are asked for our flavor preferences, fashion styles, locations and points of interest. Social media platforms use this data to understand needs, hobbies and preferences to recommend the right content and ads to their users. Wearable technology brands like the ones mentioned in my previous article, track our everyday movements to deliver customized insights for health tracking and monitoring—all to provide potential consumers with the right offers that’ll convert them to loyal customers.

While there is a level of convenience that comes with personalization, many consumers are still wary of how much of their data is being shared with companies and brands. “Trust and security” are now just as an important of a factor as “price”. Accenture research found that “after a large, public data breach, companies can see an almost 10% decline in revenue for up to six months after the breach compared to companies who did not suffer a breach. Furthermore, it can take almost two years to recover that lost revenue, by which time those companies will likely fall even further behind their competitors.”[1]

Now more than ever, using data responsibly falls on the shoulders of these companies, and moves beyond just product and experience, to building loyalty and trust with their consumer base.

How is data shared?

In a technology-driven world, data has become even more accessible, and every person leaves a digital footprint on each app, website and device they utilize throughout the day. Where we were last night, what we want for dinner today, our travel plans for next summer, etc. Sometimes these companies seem to know us better than our own family and friends. You might be wondering, “How is this possible? How does YouTube know that I was looking at flights to Paris earlier, and then shows me offers and deals from an online travel agency?”

As users, we allow this data-tracking to happen in exchange for using a company’s products and services. The data collected by companies using their own sources, or 1st party data, is often shared and sold to data aggregators and data marketplaces, becoming 3rd party data. As our world becomes more data-driven, businesses are starting to realize how critical third-party partnership ecosystems are to their business models, and brands will increasingly turn to these data marketplaces to learn more about their consumers and create opportunities for future growth.

What happens when an organization misses the mark?

When an organization fails in an obvious attempt to prove they know their consumers a little too well, it may backfire and can completely alienate even loyal consumers. When this happens, it raises the consciousness of the fact that personal data is being used in a manner that consumers aren’t comfortable with, and people could make explicit efforts to have their personal and profile data removed.

Companies need to recognize how private data and specific elements are blatantly being leveraged when targeting their consumers with personalized offers. New data and existing datasets must be combined with more sophisticated analytic techniques to build recommendations that are meaningful, add value to consumers’ lives and most importantly build trust in the brand.

Where can the data-led transformation take future capabilities?

As customer data becomes increasingly distributed, many companies no longer need to own the data-collection process from start to finish. “Third-party data marketplaces can provide the necessary information needed to create new experiences, open new streams of revenue and build unique business models.”[2] Companies are also increasingly seeing the value in working with other enterprises to create unique digital offerings. Let’s look at a company like Quil Health, a joint venture between Independence Health Group and Comcast, and a company that structures their entire business model around partnering with their people, providers and other technology companies. By putting partnership at the core of their strategy, Quil has created a platform that offers personalized health journeys—at a lower cost—for their users and caregivers. Now, Quil is recognized as a major disruptor in the personalized health space.

When done correctly, data-led transformations, and the capabilities of AI fueled by this data, can open doors for a plethora of untapped and unexplored opportunities. As we head into an increasingly digital world, every company will likely realize the value and impact AI can have towards their growth.

In my final article in this series, we’ll explore the increasing importance of Responsible AI. Following along to learn how the emergence of AI as the Alpha trend over the past decade will shift the focus from “what can AI do” to “what should we do with AI”.

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