Personal information management systems: Customer data pros and cons

Ctrl-Shift’s PIE2014 event took place last week, with the midata programme driving a number of positive discussions around the topic of personal information and the concept of businesses giving customers their data back.

The midata initiative - a personal information management system (PIM) designed to put customers back in control of their own data - is taking shape in the UK with government support, and similar initiatives are underway in the US, Canada and France. With the UK government suggesting that midata could be enshrined in legislation in the next year or so, there could be significant implications for the ways that businesses handle customer data. 

But attendees of PIE2014 were more keen to focus on the benefits for both marketers and consumers, both of which were made clear through the course of the day, and a number of UK and global businesses declared serious interest in involving themselves in midata, as a result.

However, concerns remain as to how businesses, especially those with vast amounts of legacy data, could actually provide legible transcripts for customers in any kind of single-view when giving data back, and the format in which this would be done seems likely to be a major sticking point in the near future.

Some private-sector multi-nationals are already forging ahead with the scheme, regardless. Earlier this week it was confirmed that a number of UK banks had signed up to midata, while one of Europe’s biggest retailers, Sonae announced last week that they plan to give their data back to their customers via a personal data store. Telefonica’s head of digital confidence, Lucio Godoy also confirmed during PIE2014 that the Spanish telco was now operating an opt-in scheme for its customers, whereby people can decide themselves how much visibility they want to have in terms of the data Telefonica can use on them:

“We run a number of different opt-in levels for our customers now [in terms of personal data]. It gives them an opportunity to decide where and when they want to participate in marketing campaigns. We’re very conscious of making people aware that if they opt-in, they’re not selling their souls to the devil. But the scheme gives customers a chance to decide, and that’s where we see the future lying for us, in this space.”

Ctrl-Shift’s strategy director, Alan Mitchell spoke of the dangers of too many businesses running opt-in schemes for personal data usage, predicting that it could lead to a world in which customers wouldn’t be able to run any simple transactions without a contract having to be agreed first:   

“This is the way the world is moving – from opt-out to opt-in. The issue is going to be click fatigue; that consumers are faced with all these options and every time you do something you get another question about whether you want to opt-in. There are lots of unanswered questions about what the best process and mechanisms are to give individuals control without it becoming a complete pain in the neck so they don’t bother. We’re working on gaining more of an understand about this though.”

Business advantages

Despite the technicalities, the advantages of midata for businesses were made far clearer during the course of PIE2014, with a number of marketers in the room declaring the issues they were having with ‘bad’ data currently being collected on their customers, and that giving customers the power to actively offer up their data would make for far more compelling two-way customer relationships.

Loyalty and customer experience were also seen as drivers for change; with data empowered customers expected to be far more likely to give their data to businesses and then stay loyal to them through the customer journey, because of the decision required to commit.  

Martin Hayward, VP for global digital strategy at Aimia, a global leader in loyalty schemes and operator of Sainsbury’s Nectar card scheme, believes loyalty will help self-regulate the personal data management space in the near future:

“Our ability to control this next wave is there to be seen. There will be a lot of noise if customers are in charge of their own data. The role of loyalty is to make a lot of what might happen irrelevant…to help consumers and build a relationship with them so they’re not tempted by the short term noise flooding through their smartphones and PCs.”

Where midata leads is a source of much interest. Prof. Sir Nigel Shadbolt, the chair for midata and the Open Data Institute, suggests consumers were fast-becoming savvier about their personal data, something that will force businesses to change their business models to account for this shift:

“There is real pressure for data portability. It should be something that people and businesses are thinking about going forwards, not least because people will be life-logging. People will expect a continuous, lifelong history of their digital presence on this earth. We are in the digital age, one where there is an increasing amount of information being collected about us and it will be important that businesses appear open to this.”  

The concept is still incredibly complex. But with many large-scale organisations in the room at PIE2014 showing an interest and a market in need of a shake-up, we could yet be edging closer to what Alan Mitchell describes as “a fundamental transformation in the way our economy as a whole works”. Watch this space.