The Big Emerging Issues
There are many issues affecting marketing and consumers in the field of emerging media; some of the most important are given below:
• Consumer privacy
• Mobile tracking of consumer locations
• Marketers collecting and selling consumer data that end up in the hands of data brokers
• Social media disclosure by businesses
• Businesses suing consumers after they post negative social media posts about their consumer experience
Consumer Privacy
This is a topic that is changing so rapidly we almost need to check Google News daily to stay up to date with the latest developments.
As The Wall Street Journal (WSJ) reports, “Companies today are increasingly tying people’s real-life identities to their online browsing habits.” (Valentino-Devries and Singer-Vine 2012)
The question is whether this is good for marketers and consumers, or only beneficial to marketers.
The WSJ reports, “The use of real identities across the Web is going mainstream at a rapid clip.” A Wall Street Journal examination of nearly 1,000 top websites found that 75 percent now include code from social networks, such as Facebook’s “Like” or Twitter’s “Tweet” buttons. Such code can match people’s identities with their web-browsing activities on an unprecedented scale and can even track a user’s arrival on a page if the button is never clicked (Angwin and Valentino-Devries 2012).
In separate research, the Journal examined what happens when people logged in to roughly 70 popular websites that request a login and found that more than a quarter of the time, the sites passed along a user’s real name, e-mail address or other personal details, such as username, to third-party companies. One major dating site passed along a person’s self-reported sexual orientation and drug-use habits to advertising companies (Angwin and Valentino-Devries 2012).
An excellent source of stories about consumer privacy can be found at http://online.wsj.com/public/page/what-they-know-digital-privacy.html
Two browser add-ons that can help reduce tracking when you browse the web are: Ghostery and Disconnect.
Mobile Tracking of Consumer Locations
Cell phone tracking is now pitting consumers against retailers in many ways, and once again, privacy is at the heart of the issue.
According to the FTC, about a thousand new mobile applications (apps) enter the market each day. They raise significant privacy issues and carry equally significant liability issues for those who develop or sponsor them (i.e., the company that creates them), and even for those who simply market them. In February 2013, the FTC released a report, Mobile Privacy Disclosures: Building Trust Through Transparency, that outlined numerous best practices concerning the making, marketing, and use of mobile applications (Greenberg and Kates 2013).
According to author Chuck Martin, Mobile Influence: The New Power of the Consumer (2013), “Product tracking has gotten very sophisticated over time, with RFID (radio frequency identification) chips and readers and other inventory-tracking systems. Combined with mobile tracking technologies, the logical next step is to link the product locations and products with mobile shoppers and their behaviors and current needs. The goal would be to make the trips through the aisles faster and the exit from the transaction points more efficient and friction-free for the consumer.” This can be good for marketers, but is this what consumers want? Should consumers have the option to opt in for tracking?
New technologies now allow retailers to use cell phone signals to track shoppers as they move around the store—including the aisles where they spend the most time, if they make a purchase, and how often they return to the store. Some technologies, such as iBeacon, require that customers download a mobile app, turn on Bluetooth, accept location services, and opt in so they can be tracked and receive in-store notifications (Levitt 2014).
Other approaches, pioneered by analytics startups such as Nomi and Euclid, use sensors to pick up signals emitted from any Wi-Fi-enabled cell phone. This means that any consumer who walks into a store (or even walks by a store) with his or her cell phone turned on may be automatically tracked—without knowledge or explicit consent. (Nomi and Euclid both say that they collect nonidentifiable data and offer opt-out agreements). (Levitt 2014)
Industry research shows that consumers overwhelmingly reject cell phone tracking. In a recent OpinionLab study of 1,042 consumers, 77 percent said that in-store cell phone tracking was unacceptable, and 81percent said that they didn’t trust retailers to keep their data private and secure. The biggest concerns are that retailers will not keep the data safe (68.5 percent); tracking feels like spying (67 percent); and retailers will use the data exclusively to their own benefit (60.5 percent) (Levitt 2014).
Opt-in seems to be the heart of the issue. When asked about the best way for retailers to approach in-store tracking, 64 percent of consumers said that the best approach is opt-in, versus a mere 12 percent who stated that shoppers should be automatically tracked (Levitt 2014).
Marketers Collecting and Selling Consumer Data to Data Brokers
In 2014, CBS News and 60 Minutes broadcast a groundbreaking story called “The Data Brokers: Selling your personal information.” (CBSNews.com 2014)
Companies and marketing firms have been gathering information about customers and potential customers for years, collecting their names and addresses, tracking credit card purchases, and asking them to fill out questionnaires, so they can offer discounts and send catalogues. But today, we are giving up more and more private information online without knowing that it is being harvested and personalized and sold to lots of different people...our likes and dislikes, our closest friends, our bad habits, even your daily movements, both on and offline. Federal Trade Commissioner Julie Brill says we have lost control of our most personal information. (CBSNews.com 2014)
No one even knows how many companies there are trafficking in our data. But it is certainly in the thousands, and would include research firms, all sorts of Internet companies, advertisers, retailers, and trade associations. The largest data broker is Acxiom, a marketing giant that brags it has, on average, 1,500 pieces of information on more than 200 million Americans. (CBSNews.com 2014)
Every piece of data about us now seems to be worth something to somebody. And lots more people are giving up information about people they do business with, from state Departments of Motor Vehicles, to pizza parlors. (CBSNews.com 2014)
Tim Sparapani says it is a lot. He has been following the data broker industry for years, first as a privacy lawyer for the American Civil Liberties Union, then as Facebook’s first director of public policy. He is currently advising tech companies and app makers. Sparapani thinks people would be stunned to learn what is being compiled about them and sold, and might end up in their profiles: religion, ethnicity, political affiliations, user names, income, and family medical history. And that is just for openers. Tim Sparapani: Most retailers are finding out that they have a secondary source of income, which is that the data about their customers is probably just about as valuable, maybe even more so, than the actual product or service that they are selling to the individual. So, there is a whole new revenue stream that many companies have found. (CBSNews.com 2014)
Summary
In this chapter, I have discussed some of the most important emerging issues, including consumer privacy, mobile tracking of consumer locations, businesses selling consumer data to data brokers, and businesses suing consumers after they post negative social media posts about their consumer experience.