Created by the mysterious hacker known as Satoshi Nakamoto, the blockchain technology — the distributed ledger technology that underlies the Bitcoin virtual currency — Blockchain has the potential to upend industries from finance to real estate to entertainment. In the simplest terms, the blockchain transfers value…
The value of personal data.
Personalized marketing or ‘one-to-one’ marketing was built on the assumption that people are willingly or unknowingly ready to ‘give in’ their personal data in exchange for a more personalized experience or for ‘free’ services. But now, after the introduction of GDPR, businesses will not be in control of consumers’ personal data anymore: clients themselves have to be in charge of that.
The digital agency Sygyzy conducted an interesting survey this summer about how much people value their personal data; now that they are in control, would they be happy with selling them in exchange for a more personalized experience? If yes, for how much?
They conducted the survey in 3 countries: Germany, UK, and the USA. More than half of the respondents said that the brands and services they use already know too much about them.
Sygyzy also analyzed the percentage of users who stopped using online services because they don’t trust them with personal data. They compared the results with the first ones. Surprisingly, the percentage of respondents who have stopped using an online service/retailer over the last year was smaller.
The numbers obtained in the survey are 25% of Germans, 36% of English and 35% of Americans.
This means that people are somehow aware that some companies have control over their personal data. Even more, they are aware of the exploitation of the respective information. But somehow not everyone takes action against this.
The price of personal data
When people were asked about selling their data to their favorite brand, 2 in 3 Germans and more than half of English and American respondents said they would never sell at any price. A minority among all the three countries would be happy to share their data for free. The rest (between 20% and 30%, depending on the country) would be willing to sell personal data already held online about them to their favorite brand at an average price of 140 euros in Germany and 130 in UK and USA.
‘If Google offered to pay you €20/month to track your activity across all your devices, would you accept’?
15.8% of Germans said yes together with the 39,2% of the English and 32,5 % of the Americans.
This survey also shed light on the fact that the percentage of people that are interested in receiving a personalized experience in exchange of sharing their personal data, even with a trusted website, is not as high as businesses probably expect (14.3% in Germany, 23,9% in the UK, 20,8% in the USA).
The “new oil industry”
In an article from May 2017, The Economist defined the data industry as the new oil industry. The article suggested that the antitrust authorities should review their methods of judgment in order to avoid a data economy ruled by few giants. And again, the huge power those companies (Facebook, Google, Amazon etc) have on data (and therefore on the privacy of people) was underlined, reminding that this is the biggest source of their income. According to LSE Business Review (2016), advertisement accounted for 92% of Facebook revenue and above 90% of Google revenue. This is equal to approximately 60,000 million $.
Who has more to gain?
This citation of the LSE article states that: “The generated value from personal data can in principle benefit online platforms, firms, and consumers. Personal data can remove information asymmetries and facilitate efficient transactions. Online platforms collect data from consumers, which they use for attracting advertisers. They process consumers’ data and share the main outcomes with their advertisers. By doing so, they incentivize them to develop better quality services and products that better suit individuals. In this way, market demand increases and firms can realize higher revenues. Consumers, meanwhile, receive advertisements for goods that are closer to their preferences and needs.”.
Is it worth it to trade privacy and the power that companies have over people with the value it offers to customers (even if it’s money which they gained by selling personal data)?
Experts proved that the economic value of personal data is worth millions or more. But is the two-sided data market (business-consumers) even for the two parts? More precisely, are both sides taking the same advantage from it?