Today’s column is written by Tom Noyes, CEO at Commerce Signals.
Sharing is a trait we are taught at a young age, but when it comes to data, being selfish doesn’t just have benefits – it’s often necessary.
A kindergarten teacher with a classroom of children sharing Tonka trucks and Barbie dolls is far different from the real world, where data is a major component of our daily lives. Data is no toy.
Once shared, control over how it is used may be lost forever. This crucial misstep can cause a loss of trust and create a chain reaction that hinders our ability to action the data in the future.
In light of privacy-related controversies and the impending General Data Protection Regulation, consumer-focused companies are investing in growing their first-party data sets. I see several actions they need to take as they embark down this path.
Learn from Facebook and Cambridge Analytica
Facebook established rules about how the data it collects could be used. It had policies in place that required data deletion, and it even sent specific follow-ups to make sure its deletion policy was followed.
But as we all now know, once data leaves your four walls, just a contract or letter can’t control its dissemination. Neither the researcher who collected the data nor Cambridge Analytica followed the rules that were agreed upon. When this information was divulged, Facebook lost consumer trust and market cap because it did not control the data entrusted to it.
With whom do marketers share data? What other data sets are being combined? Who owns and permissions its use? Are your partners, without your knowledge, creating derivative data products?
People-based marketing has driven a complex supply chain of data specialists, and brands must understand where their first-party data is flowing and how it is being used.
Don’t wait for government action
Data breaches are nothing new, but every time it happens at a retailer, a search engine or some other site, there are calls for legislation.
Last year, Equifax fell victim to a cybersecurity data breach that compromised the personal information of as many as 145.5 million people. Every major media outlet and cable news channel covered the story, politicians held hearings, and bills were introduced. The net result is negligible to date, because legislation is difficult to enact, and competing considerations and views – both domestically and internationally –continue on how valuable data should be protected.
No matter how good the laws and regulations are, the issue is one of enforcement. Because there will always be those that don’t follow the contracts or have “rogue” employees or system failures, brands must proactively protect their data.
Data is about cold, hard facts. Once taken, copied and shared, it cannot be simply repossessed or returned like a physical object.
Take action now
Information about shopper preferences is invaluable for marketing, personalization and business growth. First-party data sets typically come from loyal customers who have rewards cards and online purchases. With 90% of retail purchases occurring offline, most first-party data sets are missing nonloyal customers – the very people marketing programs are trying to attract.
Because the need to supplement first-party data sets is not going away, brands should develop the skills and systems needed to manage and use needed first-party data. Marketers must play a big role here and not assume that IT will independently manage all things data security.
Brands must identify trusted partners that can help them acquire and disseminate data insights.
And finally, brands should also institute their own data use and sharing policy that enables transparency, using the old guideline: Would we be OK with this as a headline in The Wall Street Journal?
I’m willing to bet that the answer is no.
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This post was syndicated from Ad Exchanger.