Some people think it's time for marketers to cough up cash in exchange for marketing data.
New York Times writer Nick Bilton says Facebook CEO Mark Zuckerberg owes him money because of the company's upcoming initial public offering:
Without me, and the other 844,999,999 people poking, liking and sharing on the site, Facebook would look like a scene from the postapocalyptic movie "The Day After Tomorrow": bleak, desolate and really quite sad.
Bilton says he should get $50, based on the number of people using Facebook and the expected $100 billion value of the company's upcoming IPO.
I assume Bilton is kidding. But some of the people he interviews think he's on to something. For example, Yannis M. Ioannides, a professor of economics at Tufts University, suggests that if social networking sites like Facebook allow targeted advertisements based on user information, these sites should pay users.
However, Facebook isn't forcing anyone to use it, as other writers have pointed out. The company's business model is a common Internet quid pro quo: Facebook offers free services, and users allow Facebook to mine their data for advertising.
But what if consumers are able to store information about themselves on a Website that could be tapped by advertisers and marketers who would pay or offer other enticements for that data? Personal.com is creating a Website service for storing personal information for users to "save time, make better decisions, and ultimately earn cash and savings of more than $1,000 each year... Use your power to demand that companies play by a fair and transparent set of rules if they want to access your data."
Personal.com suggests users could store a wide variety of data, such as interests in movies and travel and other information in demand on social networks. Users could also store more finely detailed information, such as data from a birth certificate and a driver's license. Users who are frequently invited to homes for lunch and dinner could store their food preferences and allergies. For babysitters and house sitters, users could store information about their security systems, entertainment systems, and pet- and plant-care.
Personal.com and others talk about this highly personal information as "small data," or little "gems." Of course, much of this data shouldn't be shared, but the company seeks to use appropriate gems for a commercial platform. One "Personal" writes in a blog post that
the marketplace would focus on commercially relevant data such as your brand, travel or clothing preferences, along with data about your intent to buy something (also known as purchase intent). These two types of data alone can fundamentally change data economics when combined with a controlled marketplace to reach you when and how you want to be reached.
Users who share their data with specific companies would receive highly targeted information, such as travel packages for upcoming trips as well as discounts and even cash rewards. In return, Personal.com would get a 10 percent cut of the money its users saved.
CMOs should realize that Personal.com isn't the only company looking to capitalize on personal "data lockers," as they're being called. Take a look at Mydex, Qiy, and Glome (also here). The overarching pitch is that consumers can retain some control of their data, decide who gets to see it, and perhaps obtain something for it. You'll probably hear more this year about these efforts as companies exit from stealth mode or open their closed betas.
Frankly, I can't see many or any of these companies succeeding. Consumers already freely provide data about themselves on Facebook and other social networking sites as well as agreeing (knowingly or not) to data capture by their cellphone applications. And then there are the Internet giants of savvy data vacuuming like Amazon and Target.
Unless consumer behavior changes drastically, and significant numbers of users begin storing data in sites such as Personal.com -- and removing their personal data from other sites -- I don't expect data lockers to be valuable for many marketers.
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— Alan Reiter is president of Wireless Internet & Mobile Computing, a marketing consulting firm for wireless data businesses in the US and abroad.