When Stephen Baker’s “The Numerati” was published, Publishers Weekly Review called it a “captivating exploration of digital nosiness” – it also caused quite a few lively debates around my kitchen table. But recently I’ve been thinking about how it applies to our business, specifically, as marketers and people who benefit most directly from the work of data miners, or “entrepreneurial mathematicians,” as Baker calls them – what lessons can we take away from this book?
- Consumers today are increasingly aware that they’re being tracked by marketers – and most don’t like it.
Yet, while online activity data mining has grown significantly over the past few years, particularly as a result of social media, we’ve also seen increasing efforts to track people within the material world – from mannequins tracking shopper activity to RFID-enhanced tags, loyalty cards and monitoring mobile devices. Advertisers and marketers should proceed with caution and be careful not to be (or appear) predatory or possessed of knowledge that, however reasonably gained, makes potential customers or employees uneasy.
- The “numerati” who profile us can be wrong, and in fact are wrong all the time.
It’s happened to all of us – you update Facebook on your weekend trip to Las Vegas, and for the next few weeks you’re being served ads for gamblers anonymous and casinos. You use your bookstore card across town and receive offers from restaurants 35 miles away. You look at one, (just one!) Batman DVD for a gift, and Amazon wants to sell you nothing but superhero shows for months. You get the point – the best way to annoy your customers? Barrage them with useless information that results from data analysis gone horribly wrong.
- As marketers, we must combat the idea that data mining and analysis are necessarily evil invasions of privacy that serve no greater good.
Yes, being tracked can feel creepy. And yes, it can sometimes make incorrect deductions. But – as Baker points out – there are significant benefits that can come from data mining. For instance, Baker describes networked devices that offer hope of vastly personalized healthcare, particularly for the elderly who might be able to live independently and more confidently through continuous data collection. For companies that collect data from their customers, it’s best to be upfront about what you intend to do with any information you collect and – probably more importantly – be specific about what you will not do.
It’s not just a matter of conforming to privacy laws, it’s about forming a trusted bond with your customer—one that the responsible use of data analysis can actually strengthen. Says Baker:
“If you think about the way our grandparents lived, they probably lived in a community where people knew them and knew what they were like and could give them something closer to customized service than what we get in a supermarket. So being known isn’t necessarily a bad thing.”