In light of the recent National Security Agency scandal in the US, theres been increased attention paid to default on data gathering. Regaining your privacy in this environment might seem like an impossible task as an individual, but there are broader solutions on the horizon. As Jaron Lanier argued for Quartz last month, a monetized data economy will allow the middle class to endure in an economy driven by information. So, a remedy for default on might be helping individuals to value and monetize their own information; budgets create moderation as Lanier said.
There is a far more efficient path to an information economy that respects privacy than the legislative or technological (such as cookie blocking or do not track, or DNT) alternatives: Allow people to market their own data. Unfortunately, previous such efforts to help people sell their data, such as personal and other data lockers, have failed to scale; this is in large part due to a model necessitating the creation of new markets to sell data instead of disrupting of existing ones. Value isnt created simply by gathering up a good and sticking a price tag on it. To succeed, we must find an existing market that consumes a lot of personal, and ideally non-sensitive data, to enter and disrupt. Digital marketing seems like a good option given that only half of the data sold today is correct.
Today, this market is dominated by companies like Bluekai, Exelate, Yahoo, AOL and other third parties that gather data about consumers and group them into audiences like soccer moms and aspiring digerati. They then sell cookie IDs to advertisers who use them to find consumers on advertising exchanges. But advertisers like to buy these groups at scale, spending tens or hundreds of thousands of dollars at once. So selling one individuals data would be like setting up a lemonade stand on the side of an interstate. Quaint, and you might earn some press, but no one is going to buy your lemonade.
One fast-growing area of digital marketing that uses lots of data and is happy to capture it in small chunks: retail retargeting. Retargeted ads promote products that youve been shopping for on a particular retailers websitecommonly known as those shoes following me around the web.
It seems like retargeting is a smart place for us to start helping people monetize their data. Not only is shopping data highly sought-after by online retailers, its consistently identified as something consumers are keen to share. One can easily imagine a scenario where consumers trade information about what theyve been shopping for across the web in exchange for perks and other offers from their favorite retailers. Enliken (a company I co-founded) is building software to do just this, with the goal of making transactions with data easy, safe and transparent.
Theres no reason to think this will be limited to online retailers. As the concept of monetized data becomes more familiar to consumers, companies of all types will engage them directly and be rewarded with information of higher quality and greater brand safety than third party data affords. Were already seeing this happen today with products such as Progressives Snapshot. Compounding the benefits of better data is the fact that individuals will share more data when treated fairly, creating a virtuous cycle where companies that respect their customers data can use it to cement a competitive advantage over time.
Its here that a free market solution to privacy begins to emerge. When individuals sell data themselves they disrupt the market for data sold about them by third parties. And since they are offering a superior product to a customer offered an incentive to stop buying from third parties, the result is a world where the bulk of data available is sold or authorized by individuals themselves.
At Enliken, we know helping consumers and businesses transact with data is part of a pragmatic solution to privacy. While it might be in vogue to say personal data isnt worth anything or the only viable solutions to privacy are legislation, DNT or cookie-blocking, there are more efficient outcomes that can be achieved via open and transparent marketplaces. Competition in a free market for data will be swift, with the individual making quick work of companies who have been selling information about us all for too long. After all, no one has better, more up-to-date and complete data about you than you.
We welcome your comments at ideas@qz.com.
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The free market actually can help us control our privacy