Bartering is by no means a new phenomenon. Back in the dark ages if an individual had a chicken and wanted some wheat they would exchange a few eggs for a quantity of grain. As the volume of things that consumers wanted grew, a new way of transacting was created. The money system has worked for centuries but the internet seems to be sending society back to the dark ages of bartering.
Initially, consumers didnt realise they had entered into this personal data exchange. Data was used to enable advertisers to build multi-layered databases for direct marketing, or selling to third parties without consumers knowledge. Each time a consumer used a location setting on their phone, let an advertiser drop a cookie, or completed an innocuous online form, they were unwittingly helping to build this valuable online profile of themselves.
As social networking took off, society has by large subscribed to Googles Erik Schmidts I have nothing to hide so what does it matter philosophy. In the rush to get onto Facebook, millions gave away their most personal information relationship status, drinking indiscretions (their own and their friends ), hobbies, interests, and even that plan to hold a party when the parents went away for the weekend.
Then gradually a note of caution started to creep in and consumers realised it might not be such a good idea to show their profile to the world at large. But the horse had already bolted. All information shared in the heyday of enthusiasm for social networking was stored forever and some of it could ultimately be damaging. Furthermore, the trickle of targeted marketing material was rapidly becoming a torrent.
And brands are now seeing the beginning of a backlash. Edward Snowden highlighted some of the more sinister aspects of sharing data online, and privacy concerns are increasingly being raised. A recent survey reveals millennials are determined to take back their digital privacy. Even Erik Schmidt has had a volte-face, with his recent assertion that you have to fight for your privacy or you will lose it . In fact, 60 per cent of UK consumers say they are more concerned about their online privacy than they used to be, and nearly half consider they will be less willing to share personal information in the next five years.
So where does this leave Facebook and other platforms that rely on consumer data as their currency Facebook recently admitted to conducting experiments with members newsfeeds and a large online dating site called OK Cupid has come clean about experimenting with their matching algorithm pairing up patently unsuited people to see what difference it made.
Both actions caused outrage among users. There is a general feeling among consumers that this manipulation of data is not what they signed up to, and as they are wising up to the value of their personal information that the price being extracted may be more than they are willing to pay. While some will like Mephistopheles continue to sell their souls for immediate gratification and carry on handing over the details of their lives, others will become more circumspect.
Right now the great data exchange continues as brands barter with discounts, freebies, content, and memberships to gain valuable personal details, but consumers are clearly becoming more aware of online privacy and more guarded about giving away their valuable data. The days of easy access to endless data may be numbered for brands as consumers begin to understand the value of the personal details they are bartering.
Sarah OBrien is co-founder of Vivid Research.