Our personal data represents a vast and ever-growing resource with enormous potential to transform and improve our lives. If only we’d let it.
Concerns over privacy and suspicions about the motives and methods of big corporations gobbling up our information are, quite understandably, making many people step back from the degree of data sharing such exciting innovation requires.
The answer lies in giving people control over their own personal data. All of it. And then letting them choose to share that data with businesses and service providers offering something personal and relevant in return.
There’s nothing new about businesses using what they know about their customers to better tailor offers. From the local shopkeeper who knows what you regularly buy or the car dealership that knows you replace your car every year to the pre-internet use of store loyalty cards.
The advent of the internet and e-commerce saw an explosion in the amount of available personal data. The Personal Data Economy was born, based on the large-scale acquisition, sharing and – crucially – sale of data by businesses that would use it to innovate as well as to target and sell to consumers. The breadth and scope of this data has only expanded with the growth of social media, online shopping and other internet services.
This has led us to a point where the Personal Data Economy faces two big issues that will determine its future development.
The first is that businesses have not yet unlocked the full potential of personal data. If better quality, more accurate personal data were to be shared more widely there would be an explosion of innovation that would bring great benefit to individuals, businesses, communities and society as a whole. Everything from the public sector and health to retail and finance could see profound transformation. A recent report by Boston Consulting Group put the value of personal data in the EU alone at one trillion euros a year by 2020.
The proliferation of internet-enabled devices – the Internet Of Things – has also seen the quantity, range and depth of available data expand at a thrilling pace.
However, for the Personal Data Economy to truly thrive we must first address the second major issue – the public’s growing concern over who has access to their personal data and what it is being used for. Understandably, many feel their information is being used without permission and fear their privacy is under threat.
The benefit an individual receives in return for their personal information – the free use of social networks, for example – is not enough to overcome this growing unease. This is largely due to businesses failing to be transparent about how they use personal data, whether deliberately or not.
At the heart of the problem is the sense that consumers have no control over their own personal information. The response by many is to try to outsmart the data harvesters by offering deliberately wrong information, using ad blockers, deploying ‘Do Not Track’ functions in web browsers, and switching to incognito or other private services.
Understandably, governments have responded to public concern with legislation to protect people’s personal data and privacy. The new EU Data Protection Regulation, for example, incorporates the principles of privacy by design, explicit permission to use personal data, the right to get data back, and the right to be forgotten.
The effect of all this is to make worse the main difficulty businesses have with the Personal Data Economy – that despite the explosion in the amount of data, they can only ever see a thin, incomplete (and often incorrect) slice of it.
Plus, there is the issue of crossing the ‘Creepy Line’, where a business seems to know more about you than it should through the data it has acquired.
So how do we get to the sunlit uplands the Personal Data Economy offers? How do we make consumers comfortable with sharing the depth of personal data that will enable businesses to bring them vastly better products, services and experiences?
The answer is quite simple. We need to shift control of personal data back to the individual. A true Internet Of Me in which we own all our data in a way that is secure and private, with the option to allow others to access it in return for some benefit, be it service, convenience or reward.
This shift in control does not mean businesses have lost the advantage to the consumer. On the contrary, this arrangement offers them a far higher grade of data – what we might call Rich Data – with which to develop offers that are truly personalised. This Rich Data really is the Holy Grail, being so much more complete and accurate than the thin, less reliable slices offered by traditional Big Data sources.
Crucially, data protection legislation is satisfied because permission to use the data comes implicitly from the very individuals such laws are designed to safeguard. Having all data held locally and aggregated allows for greater insight while being secure and private. A consumer then chooses who can access this data depending on what is offered in return. A business making such an offer doesn’t even need to hold the data itself. Apps on the individual’s device can process it locally allowing for tailored services with 100% privacy.
Imagine a health application running locally that examines your social data, food purchases, fitness data and more, looking for signals of stress and illness to give you prior warning of potential problems. It would use a lot of personal data, but when held locally, wouldn’t require any third party to access it.
Consumers can also keep a record of what they have shared and send requests for data deletion using the right to be forgotten.
The challenge for businesses, then, is to convince consumers to put aside their fears and suspicions over how their information is being used. For that to happen, they need to be much more upfront about what they will do with the data they ask for and make clear the benefits of their value propositions.
By building trust they will be granted more and more access to consumers’ Rich Data, allowing them to further personalise their offers, building yet deeper trust and loyalty – a virtuous circle.
Such data will be cheaper and far more accurate coming from a single source – the consumer. Its richness will allow for new innovations that will radically reshape services and entire industries.
Wider society also stands to benefit from greater sharing of data. ‘Smart cities’ could offer travel information based on pooled journey data. Medical research would be enhanced by the donation of health and lifestyle data.
The possibilities are endless and the shift in control that will make them reality is upon us. To fully realise that potential, it is vital people share more of the personal data that they will own and control. Not merely for the sake of innovation and progress, but for the very real benefit it will bring them.
Businesses must embrace this shift, defining the value propositions and building the trust that will create a culture of sharing that unlocks the power of personal data. That way, the Personal Data Economy will grow and flourish to everyone’s benefit.