Apple, Facebook and Google Are Remodeling How Businesses Leverage Consumer Data

The blueprint for how companies distribute content to consumers and gain consent to use personal data is changing. Apple recently announced changes to the way its users' privacy will be monitored. Precisely, the plan is to give customers enhanced control over privacy settings that will give them more say over which of their personal data is granted to brands.

This has irritated executives at Facebook, who say these new changes will restrict the ability to deliver targeted content and ads to its users — a move that's sure to put a dent in advertising revenue from the numerous businesses that depend on targeted content, messages and offers for more personalized involvement and effective campaigns.

In addition, Google has also recently announced that it will change the way it delivers personalized content and ads. The company is introducing its own new set of technologies that it says allows it to track web users personally, while still respecting their privacy. According to Google, it can do this through tools that group consumers into interest groups on their devices, and never send their browsing information to a central server.

What’s At Stake: How We Use Marketing Data Today

What’s at stake is how companies use technology and algorithms to track individual users. For instance, if Google enhances privacy by masking consumer data, then businesses need to go through Google to purchase ads and, in turn, gain access to targeting data in order to deliver messages in front of a specific user base.

Driven by big data, these ads have assisted companies in targeting people who have the characteristics of someone who may find these messages and offers most interesting. Big data is the process of obtaining data from a third-party provider, collecting online activity, purchase history, social media content, and more to identify people that could be interested in what companies have to offer.

Nonetheless, one imminent problem is that companies are making assumptions based on this data, and many times those assumptions are based on old and/or inaccurate data — in addition to the fact that people are aware this is occurring and sometimes see it as “creepy.” For instance, a person googles a certain product, and then they're shown targeted digital ads about the same product in their Facebook feed.

Therefore, big data isn't favored because most of the time it's inaccurate, and it lacks consumer transparency and control. With that being said, companies like Google and Apple want to do better at keeping consumer data more private while also continuing to deliver a personalized experience for the consumer.

How Will Companies Ensure Personalization While Upgrading Privacy?

There has been an ongoing fight for some time now over a person’s right to data privacy. Additionally, there’s a privacy/personalization paradox that exists. This aligns with the fact that consumers want data privacy and to feel that their data is safe. Yet, at the same time, we live in a digital world and most people feel overwhelmed with all the messages they receive daily. Therefore, they also want messages to be personalized and relevant to them and have expectations that businesses will provide excellent customer experiences.

How Will Data Usage Change?

With that, there must be a significant change in the way companies collect and use data. As we’ve discussed, big data is often incorrect, feels like an invasion of privacy, and creates mistrust.

Therefore, companies are now embracing the collection of zero-party data. Zero-party data is information a customer freely and willingly shares with a brand they trust. It can include personal insights like preferences, feedback, profile information, interests, consent, and purchase intent.

The Result is Added Trust, Approval and Data Control

This is a step toward giving customers more control of their data. The benefit of using zero-party data is that:

• it' exclusive to the brand and no other brand has the same data;
• it’s the most reliable source of truth because the customer offers their own insight, instead of making assumptions based on big data; and
• it's relationship-based so it depends on a higher level of trust with the customer, which means the company must be open and honest about their use of the data and the relationship must be mutually favorable.

What drives all of this is that businesses in all industries, no matter their size or location, need to change how they engage and interact with their customers. They must build trust so that their customers and prospects are willing to share zero-party data with them.

By doing this, these businesses will uncover access to the data they need to interact with customers on their terms and provide heightened value in return, such as better customer service and relevant customer experiences. And by giving customers easy access to renew and edit their data, they'll be in control of their data, which not only creates trust but also keeps their data up-to-date. And that leads to a mutually beneficial relationship.

Scott Frey is the original founder of PossibleNOW, formed in 2000. Today, he serves as the president and CEO for PossibleNOW, Inc. and PossibleNOW’s wholly-owned subsidiary, CompliancePoint.