Smart Cities May Be A Godsend For Data-Driven Marketers – If They Maintain Trust

mikewestonData-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Mike Weston, CEO at Profusion.

Imagine a world where every movement is tracked and analyzed. Businesses know everyone’s route to work, shopping habits, places they’ve eaten and socialized and friends, family and colleagues.

That’s not that far removed from the world we live in now. The crucial difference is that this information isn’t centralized and connected. Social media platforms know all about your friends, family and colleagues. Organizations, such as Transport for London or New York’s Metropolitan Transportation Authority, know how you travel. Foursquare or Facebook may know where you eat, while devices like Jawbone track your movement.

But what if the picture changed and the barriers between silos were removed? Organizations could connect the dots to get a complete picture of our behavior and actions on any given day. This scenario is fast approaching with the advent of smart cities.

For brands and marketers, smart cities offer an unprecedented opportunity to learn about consumers and launch highly targeted and innovative advertising campaigns. The catch is maintaining trust in a situation where privacy can easily be violated and there are plenty of question marks about security.

Data: The Smart City’s Lifeblood

Although there are many definitions about what constitutes a smart city, for our purposes it is underpinned by a city covered in tracking devices connected by Wi-Fi. In theory, this will improve the quality of life for city dwellers by enhancing urban planning, making infrastructure more efficient and enabling better use of city resources. The lifeblood of this system is data.

It’s reasonable to assume that this data will be available for purchase by third parties because creating a smart city costs so much money, and selling access would be a very attractive way to recoup expenses. By gaining access to this data, brands and marketers have a staggering array of options to target consumers. Crucially, the gulf between offline and online retail can finally be bridged.

For example, a smart city citizen could be tracked while window shopping. If he or she lingered at a particular window but didn’t enter, the shop owner could later target that individual with ads or offers for items in the window. The adverts could even reach the individual when, based on previous behavior, they are most likely to make an online purchase. This is just the very tip of the iceberg.

Consumers will become aware that marketers know an awful lot about them. How they will react is the big unknown factor for marketers. It’s easy to invoke clichés about “1984,” but if consumers are aware their movements and actions are being tracked practically around the clock, the chance of a backlash is huge. To date, they’ve not bought into the idea that better targeted advertising is a tangible benefit to them. This means brands must tread incredibly carefully to avoid their marketing efforts making consumers feel uncomfortable. And as we are seeing with the rise of ad blocker usage, when consumers get uncomfortable they find ways to take action.

On one hand, it could be argued that people are generally getting used to companies knowing a lot of personal information about them. Many people seem to use a simple cost-benefit equation, deeming that the value of free content on sites, such as YouTube or Facebook, is worth giving up some privacy and enduring some targeted advertising. If we assume the same equation holds for smart cities, an incredibly important factor will be what consumers “get” out of a smart city.

Specifically, what can brands offer in the context of a smart city that warrants having access to such a vast amount of data on each individual?

Focus On Value, Convenience

Marketing efforts in a smart city will need to put a premium on value for consumers. It will not be enough to simply reach an individual with a clever ad based on their behavior. The message must provide an X factor, whether that’s an offer on a product or service that’s too good to refuse or targeted with such precision that its convenience is difficult to dispute. Ideally, this should be the type of marketing that all brands seek to embark upon in any case. However, the reality is that targeting is often simply a case of “best guess,” and marketing often falls into the category of spam.

There will be no room for spam in a smart city. That’s a surefire way to quickly alienate consumers. Aside from the nuisance factor, there are justifiable concerns over data security. With so much information readily available, there will be huge pressure to ensure that it does not fall into the wrong hands. Think about the irritation that spam PPI or workplace accident callers create through questionable access to a database of phone numbers. The scope for abuse with the data harvested from a smart city is huge.

The bedrock of any marketing initiative in a smart city will be trust. This means that marketers and brands need to have clear opt-outs, protect data, limit their engagement to only meaningful communications and respect the boundaries of consumers. Failing to fulfill these obligations will result in a backlash that could damage a brand and ruin the opportunity that smart cities offers for better engagement with consumers.

Follow Profusion (@prfsn) and AdExchanger (@adexchanger) on Twitter.

 

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