The Middle Ground on Personalization
It is easy to bash personalization, which is one of martech’s favorite buzzwords. For the uninitiated, “personalization” refers to customizing an ad to speak to a specific consumer based on their interests or characteristics. This could mean showing an ad specific to a customer’s location, gender, or love of soccer, to name a few possibilities.
Detractors have a number of reasons to criticize personalization. For one, in an era of poor data privacy practices where consumers rarely have consent over the collection and use of their data, “personalization” is a euphemism for violations of privacy and even, in the worst cases such as privacy-violating political uses of data, manipulation. On top of that, and more germane to everyday advertising use cases, personalization often works poorly because the data driving it is low in quality. If brands are using third-party data to ‘personalize’ ads and third-party data gets basic facts about the customer wrong, the ‘personalized’ ad will not be very relevant, missing the core objective of personalization.
But I think it is a mistake to go completely in the other direction and suggest that personalization has no value to marketers or customers. For example, content recommendations by platforms like Netflix are personalized. I like getting recommendations for TV programs and movies I am likely to enjoy based on my viewing history. Zillow personalizes the marketing emails it sends me each morning with rentals and homes for purchase that I may find interesting based on my browsing habits. And if Netflix and Zillow wanted to share that data with TV publishers or leasing marketers to send me targeted, or personalized, ads on third-party platforms, I would welcome that personalization use case, too.
What, then, is the most viable critique of personalization, and what form should personalization take to provide real value to marketers and consumers?
Consumer consent should drive personalization
Devising a more valuable and ethical form of personalization means responding to the primary imperative of the consumer data privacy movement: getting consumer consent for the collection and use of personal data. The essence of my approval of personalization in Netflix and Zillow’s cases is that I understand the data collection at work, I approve of it, I find the marketing uses of my data valuable, and I am OK with Netflix and Zillow sharing it with third parties (in whose hands it constitutes second-party data). At work here are transparency, consumer understanding, and affirmative consent. There is a value exchange in which I am content to participate.
To be frank, though, even in the cases of digital businesses I like and with which I am happy to share my data, there is room for improvement. As the consumer, I should have an easy way to tell Netflix and Zillow what of my data I am OK with them collecting and sharing. I should easily be able to identify with what kinds of companies they can share it and with what kinds they cannot. I should be able to revoke my consent at any time.
I’m not singling out Netflix and Zillow as engaging in certain data sharing practices or accusing them of being outstanding by not providing me this form of complete, easy, transparent control; rather, this is, as I experience it as a consumer, how the digital economy functions in general. Consumer control over data is simply not very strong, and it is certainly not streamlined across the many digital properties with which we engage.
The bottom line is that personalization is not useless, nor does it always mark a horrible invasion of privacy. Personalization really can improve the customer experience. But it has to be based on affirmative consent. Establishing that middle ground between personalization’s complete denunciation and its unfettered perpetuation will require more powerful data privacy infrastructure of the kind companies like Reklaim are building.
(Disclaimer: I used to write content for Reklaim. One might add other data privacy or zero-party data companies like Jebbit, Tapestri, and DISQO to the list of firms enabling privacy-safe personalization. But my impression is that most companies playing in the data privacy space are selling a solution to businesses that allows them to gain consensual data from customers or allowing customers to get paid for their data. Those ambitions would not be as foundational as the ambition to create a platform that allows consumers to access all the data businesses collect on them and take control over personal data’s use across businesses. If you think your company is building the infrastructure that will support the privacy-safe future of personalization and the digital economy, get in touch with me.)