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Consumer Data: Are Attitudes about Sharing with Brands Shifting?

You don’t have to have been an internet user fifteen years ago to know things were different then; it was the time of dial-up and buffering videos, when ecommerce was novel and social media had yet to lay its claim on our souls. Personal data was something to be guarded closely and so when ad platform DoubleClick purchased catalog data collection agency Abacus, the first major privacy scandal of the digital age erupted. Privacy advocates rallied against merging offline and online data and ultimately inspired a set of rules that would help safe-guard personally identifiable information (PII) from marketers.

Fast forward 15+ years and behavioral and location targeting are standard fare in advertising. Marketers are using in-store transaction data to optimize digital retention programs and, conversely, gauging the success of online campaigns with in-store data. Yes—they are marrying online with offline data, the same idea that ignited the milestone scandal. This widespread shift recently prompted privacy expert Allen Chappell to raise the question whether or not it was time to revisit the controls put in place as a result of the DoubleClick/Abacus deal.

More intriguing is the fact that, unlike fifteen years ago, consumers are now freely and frequently sharing personal photos of their pets, homes and children, announcing political and religious views, medical conditions and their location online. They’re surrendering personal information for the sake of learning what their zombie name would be, or what career they might have had had they been born left-handed. Is it possible that the tide against sharing has turned?

A new study released by Columbia Business School and AIMIA investigates this. “What is the Future of Data Sharing: Consumer Mindsets and the Power of Brands”, authored by Matthew Quint and David Rogers, surveyed 8000 respondents across four generations (Millennials, Generation X, Baby Boomers and the Silent Generation) and five countries (US, UK, Canada, France and India) to gain insight into what, how, and why consumers are willing to share their personal data with companies.

By examining attitudes around different kinds of data—name, address, phone number, email, purchase history and lifestyle info—the study showed that consumers are able to make distinctions between personally identifiable and other types of information, and that they understand sharing some data points makes them more vulnerable than others. However, even with this knowledge, 70% of those surveyed would still consider sharing that personal information. They offered a framework on which to better understand the range of attitudes around sharing.

The Data Sharing Mindset

By comparing respondents’ level of defense and happiness about sharing, the study identified identified 4 “data-sharing mindsets”.

DataSharingMindsets_ColumbiaBusinessSchoolStudy

“Defenders”, or those that are unwilling to share data and/or take defensive action against sharing (such as giving false information or making efforts to limit how they are tracked online) represent the largest of the four segments. Still, their active resistance leaves them in the minority; 67% of those surveyed were either willing to share data or, somewhat pessimistically, resigned to sharing it. While it didn’t prevent consumers from sharing, that negative attitude toward sharing characterized the majority (66%) of respondents.

So, essentially, consumers are sharing data even when they aren’t necessarily “happy” about doing so. What, then, is driving this action?

The Motivation for Sharing Personal Data

Naturally, trust plays a role here; 75% of those surveyed were more likely to share data with a brand they trust. The study presented a fairly optimistic view of the state of brand and consumer relations in that most of those surveyed acknowledged at least one brand they trusted across the six industries presented, including Financial Services, Retail and Airlines.

BrandTrust_ColumbiaBusinessSchoolStudy

Interestingly, Financial Services stood out as the industry for which most consumers identified a trusted brand, perhaps suggesting they believe that these companies are more conscientious when it comes to safeguarding the information with which they are entrusted.

Another key factor is value. The study showed that offers have an influence on whether or not consumers shared data with brands, as well as what data they shared. An offer might entail signing up for a newsletter to get a discount, registering for a “shopping club”, joining a loyalty program, or gaining access to special events. Not surprisingly, financial incentives like cash back and discounts scored most effective. (In a sense, this becomes more of a barter than sharing. Along these lines, as authors Quint and Rogers noted, the World Economic Forum is researching personal data’s potential as a new asset class.)

The study also recognized the trend toward “non-traditional, data-enabled benefits”, such as Security, User Experience, Societal and Insight benefits.  Product recommendations, as offered by Netflix and Amazon, fall into this group. So do services like Mint and Billguard which, in their promise to support financial decisions, aggregate data that’s more sensitive than your late night Narcos binge-viewing. And, any content marketer will find validation in the role that Insights play in acquiring customer data. (There is some irony in the fact that, among the non-traditional benefits that drive consumers to share their sensitive personal information, Security topped the list.)

Sharing is Not a Reflection of Comfort

Despite a willingness to share, the survey reflects the general sense that consumers aren’t comfortable with how companies handle their data. Even among Millennials who—correlating to a recent Nielsen survey—weighed in as the most trusting age group, only 51% felt comfortable with how companies handle data. And, across generations, the vast majority of those surveyed expressed the desire to have more information about the data companies collect (85%) and (86%) wanted greater control over that data. The study posits that “due to increasing attention drawn to data theft, loss and monitoring… many people with Happy Go Lucky or Resigned mindsets in the past would have become Savvy and In Control or Defenders.”

The recent surge in downloads of ad blocking applications supports this. While the IAB and Digiday have each noted the motivation for ad blockers is more about user experience than privacy, the act of downloading—and even paying to download—ad blockers demonstrates that consumers are more aware of, and increasingly taking action against, unsatisfying relationship with brands online. This, in turn, puts brands on the defensive. What can they do to to make consumers more comfortable?

What the Future of Data Sharing Means for Brands

Just because consumers share pictures of their family vacation on Facebook or pin their Thanksgiving dinner menu, brands shouldn’t assume that they’ll benefit from any general trend toward sharing. Instead, they need to focus on building trust, which means being transparent about their collection and use of data and respectful of consumers’ fear and desire for control. This isn’t groundbreaking stuff, and in broad strokes mirrors the guidelines that came into play some fifteen years ago.

More exciting, however, is the opportunity to create data-enabled incentives that make sharing with brands worthwhile, and maybe even irresistible, to consumers. This is both compelling and challenging because, unlike the traditional email-for-discount exchange, the best expression of data-enabled incentives isn’t one-size-fits-all. Some will be experiential and deeply tied to the product—think of anyone who has easily surrendered their location to catch an Uber—while others might be more complementary. For example, Saatchi’s recent “Digital Pawprint” campaign aims to match users with their perfect pet by targeting banners based on digital behavior.

Either way, brands are challenged to dig deeper. They must apply the insight they already have on audiences to construct worthwhile incentives that draw further insight and, ultimately, grow their business. By offering creative and value-driven benefits, supported by transparency and trust, brands can build a more meaningful exchange with consumers today. They’ll also be better prepared for the next, bigger wave of data that’s coming with our wearable and IoT future.