Because there is a notion that this data is valuable. It helps run businesses, form engaging marketing campaigns and strategies, and provides them with key insights into their customers’ behaviour.
An increasing number of organisations are waking up to the variety of opportunities that data, when used creatively, responsibly and sustainably, can offer both the business and the consumer.
For many businesses, data, and the insights they derive from it, is one of their greatest assets, if not their most valuable. In some instances, this data is the only asset they have.
An asset possesses value, so what’s the value of data?
In principle, we need to arrive at a point where brands are interacting with customers in all kinds of meaningful ways, using data to create all kinds of unique experiences. Engaging consumers with the right opportunities at the right times.
The DMA’s ‘Value of Data’ campaign aims to elevate and champion the role of data, from classroom to boardroom – and help organisations across the UK responsibly deliver value to their customers.
This project aims to ask difficult questions about where the value of data really lies. In the data? Its quality? Its quantity? Or in the way we use it to create better outcomes for customers? By having better values, could organisations deliver better outcomes to their business, their customers, and society at large?
Extracting value from data: how to do it and the obstacles to overcome
By finding the answers to these questions the initiative aims to introduce bold, innovative, data-led approaches to customer engagement, underpinned by solid ethical frameworks.
The project is bringing together key stakeholders across academia, government, and the public and private sectors to find outcomes that build better business through mutually beneficial, sustainable relationships with customers.
Global regulations supporting a data revolution
A data-driven economy cannot function effectively without consumers trusting that organisations are putting their needs first and managing their personal information with care and due diligence.
In recent years, revisions to laws surrounding data and online marketing, proactive enforcement by regulators like the Information Commissioner’s Office (ICO), as well as the unified efforts by organisations in the data and marketing industry, have helped lay the foundations for a global data revolution.
The introduction of the General Data Protection Regulation (GDPR) in May 2018 has reinforced the importance of accountability, transparency and security when it comes to data acquisition and management, or risk sanctions vastly bolstered by the new regulatory powers established by the GDPR.
Earlier this year, the hotel chain Marriott was fined for more than £99 million and British Airways was issued a fine of £183.39m. Highlighting just how much importance the regulator places on the security of customers’ data and how seriously businesses should take this issue.
The costs of mismanaging data to a business extend far beyond just fines, there can even be long-term effects on customer trust, share price and public perception that could have a lasting impact.
One of the knock-on effects of the GDPR and the penalties imposed on brands is an enhancement of global data privacy standards.
The California Consumer Privacy Act (CCPA) in the U.S., coming into effect in January 2020, will restrict how brands collect and hold consumer data, while giving consumers more control over how companies collect and profit from information.
The California Consumer Privacy Act vs. GDPR: what UK businesses need to know
At a time when individuals are becoming increasingly aware and concerned about data privacy, a customer-led approach could be key to increasing trust and confidence.
Customers share data in exchange for personalised services
As consumers, we are increasingly becoming aware that by using digital platforms, such as search engines, social media, maps and other tools, we are essentially trading our data for access to services and products.
Over the past 18 months, there have been some encouraging findings indicating that consumers are more willing to share data and marketers are more confident about their reputation in the eyes of consumers.
The DMA’s ‘Data Privacy: What the consumer really thinks’ report found that 51% of the respondents view data exchange as essential to the smooth running of the modern digital economy, up sharply from 38% in 2012. They are also receiving improved service by sharing their data, with 46% agreeing – up from 33% in 2012.
In addition, nearly half of marketers (49%) surveyed in the ‘Data Privacy: An Industry Perspective 2019’ report believe consumer trust has improved in how brands handle their data since the new regulations came into place. In addition, 46% state that trust has increased in brands and their marketing too.
These findings suggest that as an industry we are heading in the right direction, but there’s still a lot of progress to be made.
The ICO’s ‘Information Rights Strategic Plan: Trust and Confidence’ report 2019 found that when consumers were asked if they trust brands with their data just 28% agreed. While this has increased by 6% since 2017, this number must be much higher if businesses are to truly thrive in the digital age.
How do we measure the value of values?
The current lack of universal quantification means data is likely to stay off the balance sheet for now.
This is simply because placing a value on data isn’t without its complexities. Who ascertains its value in a data-driven economy? Is it the brand or consumer, or both?
Defining the true value of data will come down to organisations coming together, asking the big questions, sharing insights and case studies through the campaign’s research, roundtables, networking events and seminars.
Digital transformation and the workplace
We want to prove that doing the right thing with data builds better and stronger business connections. There is a clear role for ethical frameworks to showcase data as a true force for good.
Innovation through data must respect customers’ privacy
GDPR is only the first step. We’re heading into a future powered by artificial intelligence, where our lives will increasingly be guided by algorithms.
What that means in real terms is that if we are incorrectly profiled by an algorithm, we could lose access to products, services and at times even our rights as a consumer.
It has never been such an important time to think about our values as individuals, organisations and a society to ensure we’re putting down the right ethical foundations for future generations.
In an era of mass personalisation and technological innovation, we need to demonstrate that the data consumers share is used to serve them better.
There is a growing requirement to reassure them that we have the infrastructure and ethical frameworks in place to build valuable, sustainable relationships.
With technologies such as AI having a transformative impact on business, there is little doubt that, as they continue to evolve, the data sets they rely on will be key to a competitive advantage.
Using data intelligence to grow your business and gain competitive advantage
However, as issues around data value and ownership continue to come under scrutiny, transparency over how data is handled and safeguards protecting privacy will be key factors in whether increasingly ‘data savvy’ consumers agree to share this data with organisations.
Ensuring transparency and governance over information processes will become more crucial than ever if organisations are to increase engagement and support – and continue to benefit from free-flowing access to customer data.
We aim to have the answers to these business-critical questions as our Value of Data campaign progresses in 2020 across the UK.
As we navigate through the data revolution, it is important to remember that responsible and innovative data use can build consumer trust and a willingness to share insights – creating better opportunities for both the business and the customer.
