"Data-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 Ray Kingman, CEO at Semcasting.
Maybe you rolled your eyes when you heard that some Instagram users were protesting the platform’s decision to change its algorithm so that it surfaces the best photos, rather than displaying them chronologically.
Does it really matter if Instagram decides which selfies you see? Dig deeper, and that question can seem a lot more serious. And no, I’m not insinuating anything like the allegations of political bias that have been lodged at Facebook’s news feed.
What’s happening on Instagram and Facebook is actually part of a larger, more fundamental question. Should we live within the functionality and security of a walled garden or embrace the turbulence of choice and freedom outside the walls?
Inside today’s walled gardens, tech giants like Google, Facebook, Apple and Amazon set the rules because they control all of the collection, use and distribution of everyone’s data.
For consumers, that means ceding control over privacy, especially when it comes to their data assets being remarketed. For marketers, what happens behind the walls is just as cynical – these tech giants control the distribution channels and, as a result, have come to control the pace of innovation.
Of course, consumers and marketers are free to leave, but that’s sort of like saying you’re free to fritter away in obscurity. It’s not a real choice, and so the implications of walled gardens are a real concern for ad tech and consumers alike.
In truth, there’s no scenario in which these ad tech giants would go away or tear down their walls voluntarily. But it is possible to use technology to unwall the garden. The technology of cookies and device IDs are already having difficulty keeping up with brand attribution and are falling further behind on omnichannel every day. So the question is what would an unwalled garden look like?
Who Owns The Data?
A few years ago, an NYU student launched a Kickstarter campaign to sell his personal data. He was making a point about privacy, but whether he realized it or not, he was also making a point about commerce. In a free market, data is valuable but the originators of that data – consumers – don’t share in the wealth. For years, Silicon Valley has had the same answer for anyone bothered by the inequality of that bargain: If you’re not paying for the product, you are the product.
Today consumers pay for many of products that collect their data. Smartphones, even when subsidized, have costs borne by consumers. Likewise, consumers pay for data plans, internet access and, in some cases, content subscriptions.
And of course, with a wave of connected appliances, household devices and wearable technology already making inroads in the marketplace, consumers are financing an ever-expanding data mining operation aimed at managing the contents of your wallet within the next walled-garden unicorn. Life inside the wall is going to have plenty of bells and whistles, but the deal is going to be lopsided.
But what if every consumer followed the NYU student’s lead? What if the rules of engagement between consumer and the walled garden were equitable? A single person’s data might only yield a few dollars per day, but including consumers in the marketplace for their own data could have a profound effect on online consumer engagement.
Rather than opting out of tracking, consumers could choose to opt in and be rewarded for their consumption and their choices in much the same way that brands already award points for participation in loyalty programs and surveys.
In effect, consumers would construct an avatar of themselves – a digital persona that ties together their cross-platform identity and preferences. In doing so, consumers would not only take ownership of their data, they’d make it more valuable because avatars would fill in the gaps that plague the cookie model.
Consumers, for example, might choose to grant full access to movie studios to learn about upcoming releases, but in so doing, they would also be rewarded for sharing their demographically informed opinions about what kinds of films they like. Similarly, consumers may choose to periodically opt in to automotive ads when looking for a new car, and then opt out once they’ve made their purchase.
Such a scenario would not only allow consumers the opportunity to regain control of their privacy, it would also benefit marketers as well. By awarding points to consumers who are interested, marketers could fine-tune their messaging to address an individual’s personal preferences and purchase criteria without wasting as much time determining if they are simply in the market. There is undeniable macroeconomic benefit to both the supplier and the consumer in a more accurate and less wasteful online marketing process.
Is this nirvana possible?
Yes and no. Distrust in the walled gardens and the rest of the ad tech industry has thus far led consumers to assume a defensive position.
First it was cookie deletion. Consumers are now well-trained to actively delete the third-party tracking cookies of consumer marketers.
More recently, a growing number of consumers have turned to ad blockers, which have already achieved a level of scale that is starting to annoy the tech giants.
But some ad blockers actually allow ads through an approved whitelist. The IAB calls this extortion, but could the whitelist also be an opportunity to unwall the gardens owned by Google, Facebook, Apple, Amazon and others? Could an ad blocker, or something like it, become a crude proxy for consumer choice?
What’s bad (and possibly illegal) about ad blockers is that they’re an anarchic response to a commercial imbalance. What’s good about ad blockers is that as their scale increases, more consumers become aware of the choices they have surrendered to the walled gardens. In effect, consumers who are using ad blockers are already creating de facto avatars; unfortunately, those avatars have limited value because they only offer a binary choice: ads or no ads. The right question is which ads and at what price?
In a free market this question isn’t being answered inside the walled gardens, where only a few dictate ad tech standards and policies. How consumer data and preferences are collected and transacted can be complex. However, only innovation and the free market should determine how that process unfolds.
Right now, there is both a market need and a market opportunity. That can be a boon for the entire ecosystem, from privacy-conscious consumers to marketers and publishers who are increasingly wary of opaque and one-sided transactions. What hangs in the balance is whether those of us living outside the walled gardens get a say in how our avatar is defined and who actually owns it.