60 Minutes got it wrong: data brokers aren’t evil

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The Big Data MOPS Series with Tamara Dull

Have you heard of About the Data? It’s a website that lets consumers see what personal data’s been collected and is being used to drive the online ads they see and offers they receive. It’s a free service provided by Acxiom, a supplier of marketing data for businesses. Yes, a data broker.

I visited About the Data last September when it first launched. As a consumer, I wanted to see how much of my personal data had been collected. As a data professional, I was more interested in seeing what type of data was being collected, how accurate it was, and how easy it was for me to change and/or delete it. I was surprised at how much data had been collected and how freakishly accurate it was (~80%). Even though I had initially planned to opt-out and delete my data, after seeing what was there, I decided to leave my data as-is (with the option to change my mind later, of course).

And it appears that I’m not alone. Acxiom recently reported these site statistics: 500K consumers have visited the site since September 2013; 40% have registered and reviewed their data; 20% have changed their data; and 2% have opted out. These numbers are lower than I would have expected. Do consumers not care?

About those data brokers. In March, 2014, CBS’ 60 Minutes did a segment on “The Data Brokers: Selling your personal information.” As a consumer, you couldn’t help but watch and wonder how much of this report was true, how much of it was spin, and ultimately, why the exposé at all. Was it to increase awareness or was it just to creep folks out? Are data brokers really that evil?

As data professionals, however, we know there’s more to the story. Did 60 Minutes get it right? Who should we be pointing our finger at – the data brokers, the marketers or the consumers themselves?

Now let’s fast-forward to May, 2014: The U.S. Federal Trade Commission (FTC) released a report called “Data Brokers: A Call for Transparency and Accountability.” For this report, the FTC studied nine data brokers (including Acxiom) who collect personal information about consumers, then package it up and sell it to companies for a variety of purposes, including verifying identities, marketing products/services and detecting fraud. All without the consumers’ knowledge.

The FTC concluded that there is a fundamental lack of transparency about data broker practices and is strongly urging Congress to enact legislation that sheds light on these practices and gives consumers access to the personal information held by these brokers.

If you’re curious, the FTC report included a representative list of the data that’s being collected by data brokers. The list is eye-opening. I can only speak for myself, but these data brokers may, in fact, know more about me than I know/remember about myself. That’s a bit disconcerting.

The ball is now in the U.S. Congress’ court. Will they play ball or not?

Why this matters. Data brokers get it: Data sells. And now with big data (read “a lot more data”), there’s a lot more money to be made. The irony is that a lot of the “big” consumer data being collected, aggregated, anonymized, and sold is being generated by the consumers themselves. Think social media data. Think location data. Think mobile data.

How about all the money these data brokers are making off your personal data? But let’s not limit it to just the data brokers. It’s any company that is keeping tabs on your online and offline activity. (Yes, I’m looking at you Google and Facebook and the 1000+ other organizations that are collecting our data). If the data is being collected, it can be monetized. For good or for ill.

Questions to think about. Putting the data broker discussion aside for a moment, let’s look at your own company. You’ve been collecting data, aggregating it, analyzing it, managing it – and maybe even selling it – since your company’s inception. And now with big data, marketing analytics and related technologies, there’s even more data to be collected, aggregated, analyzed, and managed. Consider the following:

  • If your company collects customer/consumer data and one of your customers were to ask - “How are you using my data?” - would you be prepared to answer? Customer awareness and privacy concerns are on the rise.
  • If your company sells customer/consumer data, including anonymized data, how transparent are you with its use? Do your customers have visibility or access to their information? This may not be a legal issue now in the United States, but the FTC is in the process of changing this.
  • What big data money opportunities are you leaving on the table? You don’t need to sell your data to make money. You can use big data to drive operational efficiencies and/or with new insights, open up additional lines of revenue for your organization.

A closing thought. I applaud 60 Minutes and the FTC for raising awareness about data brokers, and agree that most Americans (1) don’t realize these companies exist and (2) don’t understand the role they play in marketing and advertising. As consumers, awareness is important and we should be able to access and manage the personal information that is being collected on us. Let’s not forget our consumer caps as we look at ways to utilize and monetize big data in our own organizations.

Originally written for and published on Smart Data Collective as part of the Big Data MOPS Series.


Editor's note: I am so pleased to showcase another big data series from Tamara as a Friday Feature. If you haven't done so already, consider subscribing to the Customer Analytics blog by clicking in that box to the right and get these posts delivered to your email inbox.

While you are thinking about big data, I'd like to suggest an HBR paper by noted thought leader Michael Schrage called, What Executives Don't Understand About Big Data. Take a look and let me know what you think.

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About Author

Tamara Dull

I’m the Director of Emerging Technologies on the SAS Best Practices team, a thought leadership organization at SAS. While hot topics like 3D printing and self-driving cars keep me giddy, my current focus is on big data, privacy, and the Internet of Things – the hype, the reality and the journey. I jumped on the technology fast track 30 years ago, starting with Digital Equipment Corporation. Yes, this was before the internet was born and the sci fi of yesterday became the reality of today.

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