Turning big data into smart data is essential to cut costs and grow business, but customers’ personal information must be handled with sensitivity to build consumer confidence
We live in a world where information is collected constantly. Institutions are in a position to learn more about individuals than ever before. Data capture on this scale represents a unique opportunity for businesses, policymakers and consumers. Brands can better understand what drives consumer choice. Welfare agencies are able to identify funding needs more accurately. The consumer has at their fingertips a wealth of knowledge we could only have dreamt of half a century ago.
But with so much information available, we find ourselves in danger of getting lost in the numbers – data is only as good as the questions you ask of it. This is where the skill of the market researcher comes in. We are the bridge between data and its application, asking the right questions to provide actionable insight. It’s vital that we make big data, smart data.
At the centre of all this is skill and interpretation. Much of the data that companies collect is ‘dirty’ or unnecessary to constructing the understanding and insight that delivers competitive benefit. Money could be saved by being cleverer about what data is collected.
People need to know that their personal information is going to be treated ethically
For ethically run businesses, however, this heightened level of knowledge brings with it the need for greater responsibility. Any company can collect and hold data on the general public – and most do. But the more information institutions gather, the more potential there is for misuse. Inappropriate data handling can range from deliberate abuse to unintentional carelessness, but in every case it is immensely damaging.
Skilled market research professionals have been handling sensitive data for decades and must remain at the forefront of best practice, helping businesses respect the people whose data they may hold.
And make no mistake, this matters to consumers. Research conducted by YouGov for the Market Research Society (MRS) Delphi Group revealed that 70 per cent of people judge data privacy to be more important now than it was five to ten years ago. Some 64 per cent felt that companies benefit from data collection more than the consumer, with some stating institutions derive all the advantage from the process.
There is clearly a desperate need for more transparency. The increasing monetisation of data and the more sophisticated sales targeting which is now possible needs to be accompanied by every effort to build consumer confidence. People need to know that their personal information is going to be treated ethically. MRS launched its ethical data trust mark, Fair Data, to help organisations engage in a much more transparent ‘data dialogue’ with their customers and stakeholders. It represents an independently audited way that businesses can visibly commit to ethical data use.
The simple fact is that if businesses don’t make the effort, then customers vote with their feet. Increasingly, people are choosing to ‘go dark’, cutting off communication with a company as a result of unwanted contact. Similarly, a high proportion of consumers admit to giving out false information if they have doubts about how their data will be used. In both cases, businesses and consumers lose out as they become increasingly disconnected.
If this isn’t enough to persuade businesses to take action, then perhaps the legal implications will be. The updated Consumer Rights Act comes into force in October with far more potential for punitive measures than previous legislation. Against this backdrop, institutions cannot avoid a comprehensive review of their data policy to make sure it is fair to all involved.
Used correctly, smart data represents an enormous opportunity. The MRS is a committed champion of ethical data use precisely because it will allow the data revolution to deliver on its potential. If we can facilitate that, then we can benefit businesses, consumers and society as a whole.