The information management challenges of data monetization

The information management challenges of data monetization

“On the Internet, no one knows you’re a dog” said the famous New Yorker cartoon, back when it seemed that online interactions were inherently anonymous. Today, of course, the Internet knows not just that you’re a dog, but what breed you are, what you ate for breakfast, and when you were neutered. In retrospect, the funniest thing about that New Yorker cartoon is its view of a world that quickly changed.

Data managers are still grappling with this change. Much Web advertising regulation, for example, is still premised on the notion that cookies are anonymous. This is what justifies sharing them without the consumer consent businesses need to trade in Personally Identifiable Information (PII) such as names and addresses.

But there are many ways to tie cookies to known individuals, a process that often includes “consent” consumers don’t know they’ve granted. Other theoretically anonymous identifiers such as device IDs and IP addresses can also often be connected to PII. And research has shown that even less specific information, such as a collection of taxi trips or a combination of birthdate and Zip code, are often enough to identify specific individuals.

Regulators are catching on. When the FCC and U.S. Congress recently voted to let broadband suppliers share details of their customers’ Internet and TV activities without permission, their justification wasn’t that such information was anonymous: it was that Google and Facebook could already monetize similarly personal information. European regulators, starting from stronger pro-privacy premises, are moving towards treating cookies and other identifiers as PII precisely because they recognize they can easily be tied to individuals.

Paradoxically, regulations intended to give consumers more control over their data actually force companies to be more thorough about assembling everything they know about each individual. After all, that’s the only way you can let people review and correct or delete their information. Similarly, “right to be forgotten” rules require companies to identify all published information about a person so it can be effectively flushed down the memory hole.

The loss of anonymity isn’t all bad. It lets marketing, sales, and service departments build a more complete picture of each Customer. This lets those departments tailor their actions to each Customer’s needs. Customers now expect such personalization and many refuse to do business with a company that doesn’t provide it. While consumers generally value privacy in the abstract, most will happily trade personal information for concrete benefits such as price discounts.

The social and business impacts of losing anonymity are intriguing, but data managers face more immediate challenges in managing the transition. Key implications include:

Some customer data will remain anonymous for the foreseeable future – for example, new cookies that have not yet been matched to a known individual. So long as regulations allow different uses for such data, companies will need to keep it separate from identified data. Some companies may choose not to link some information with individual identities so they can use it more freely. Companies may put the different classes of data in different databases and isolate them to ensure there’s no leakage. Or they may manage rights and permissions at the attribute level, an approach that’s more demanding but arguably more efficient.

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