"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by James Green, CEO at Magnetic.
Radical transparency is humanity’s natural state. Look at business organizations, the state of politics or your own personal relationships and it’s clear that people are comforted by more information, not less.
Although some people are scared about sharing personal information and view it as an invasion of privacy, I would argue that consumers care more about transparency than privacy.
Advertisers and brands need to connect access to personal information with the ability to provide a personal service. Marketers have not done a good job of explaining that trade-off, and we’ve allowed the discussion of privacy vs. sharing to be conflated and confused.
Of course, some things, such as financial and health information, should never be shared. But the only types of information needed by marketers pose no threat when they are exposed by a hacker: demographic (name, age, address, etc.) and psychographic (purchase information, geolocation data, browsing data).
This information has always been available offline, but making it available in real time has made people nervous. It shouldn’t.
A Historical Perspective On Privacy
The Industrial Revolution created our modern concept of privacy: Large groups of people lived in places where there was no real-time communication, which started to create the ability to live anonymously. Before that, your neighbors and immediate community knew exactly what was going on in your life. As communication technologies evolved, the anonymity (i.e., privacy) created by the industrial revolution slowly eroded. For example, nearly in lockstep with the invention of the telegram in 1838 came the technology to bug those transmissions.
In the 1970s, Americans experienced a heightened sense of privacy insecurity in the wake of Watergate. Theft of government documents and wiretapping were purported to be necessary for national security, a direct contradiction to the roll-out of the Privacy Act of 1974. With the rise of the personal computer and the shift of information from an analog to a digital world, the concept of privacy became more tenuous.
The internet and social media, including Facebook and Snapchat, give us the unprecedented ability to know when, where and what people are doing. Consumers willingly trade their personal information for perceived benefit, despite lawmakers' attempts to protect individual privacy.
For instance, the Cookie Law was passed in Europe requiring websites to get permission to track visitor’s site interactions via cookies. Although it was implemented, it has had no tangible effect on businesses, nor has it changed consumer behavior.
Another example is AT&T’s effort to help consumers avoid having their browsing behavior tracked online. AT&T rolled out a discounted broadband internet service, offering customers a $30-per-month premium charge to not have their browsing behavior tracked online for ad targeting. Most consumers elected to opt in to the ad-supported model, not out.
Either people have become more comfortable than you think about sharing their information in exchange for free content, relevant information and personalized offers or their privacy isn’t worth $30 a month.
A Shift Back To Transparency
With digital marketing on pace to surpass TV advertising as early as 2017, the rapid shift has resulted in a hodgepodge of companies vying for consumers’ data and attention. This has caused confusion and angst for consumers, who are bombarded with irrelevant online experiences and worried about how their information is being used. Consumers get mad when a product they’ve already bought follows them around the web, but stopping that from happening is directly tied to a marketer being able to know who consumers are and what they’ve purchased.
If history is a guide, our perceived benefits of radical transparency are shifting us back to what’s authentically natural and historic: transparency, not privacy. We curate our public personas and interactions knowing that there is no privacy in these communications. We see the benefits of doing so or we wouldn’t continue to engage. As we move forward, people will expect the same level of transparency online as they do when they are walking around a big city. Cameras capture our every movement, and the same is true online.
Let’s start a collective conversation about how to ethically protect those parts we want to protect – personal health records and financial information, along with protection for whistleblowers – while appreciating the benefits we enjoy from transparency. We need to educate all key stakeholders on both the risks and the costs of transparency. That way, consumers can enjoy the benefits of engagement and marketers can do their jobs – ethically and effectively.