– Jason Voiovich, Vice President, Marketing, Logic PD
We trade data for access all the time.
Facebook, LinkedIn, Google – you name it, if you use these free services, you are explicitly granting them permission to aggregate and disaggregate your data at will. Sure, there are “privacy” settings, but few people actually actively manage them. In essence, we are in an economic exchange in which we trade items of value (our data for the use of a service) largely unconsciously.
But it’s not working.
Today, most organizations are simply wasting their time with “Big Data”. No one is monetizing data effectively because their engagement models rely on passive and uneducated consumers.
That must stop.
In order for us to move beyond this arrangement and truly monetize Big Data, we need to transition to conscious models of economic trade at the consumer level. Consumers simply aren’t savvy economic participants in the equation, and that ignorance is preventing wider progress.
International mobile carrier Telefonica might just have an answer. And it will start with our kids.
At the recent Mobile World Congress, Telefonica explained that they’ve noticed something interesting in the behavior of “Generation Z” (of which my two sons are members). The real cost of the connected world for these consumers isn’t the hardware, which is increasingly becoming a leased commodity, but rather the cost of the data each month. Gen Z’ers live in perpetual fear of running over the data limits on their phone plans. And when they do, the costs jump tremendously; putting them in a real bind either with their parents (if they’re under age) or with their own limited budgets (they’re all under 25, depending on how you measure).
In this case, necessity could be the mother of monetization.
The proposition is pretty simple: What if we were willing to trade brand engagement for additional data. In practical terms, that could mean relief on a data plan restriction for a certain amount of interaction with a sponsoring brand. Think of it as a new ad model. Instead of showing a banner ad (no matter how well targeted it may be), a retailer could incentivize a mobile shopper (who are disproportionately Gen Z) by giving them free data for the next 5 minutes in exchange for continuing to shop, or 30 minutes after a successful purchase.
When you think about it, it makes sense.
This “advertising model” is a much more tangible and conscious exchange of value than the use of “free” services, “paying for eyeballs” with easily-ignored banner advertising, or irritating advertising interrupters in front of desired content.
We’re not there yet, and we don’t fully understand all of the privacy and intellectual property considerations, but we need to aggressively test new data monetization models that deliver what I call conscious value. It’s not only good for engagement with a brand, but it is just as important for increasing engagement with the data, training a new generation of savvy, informed consumers who value (and can receive value) for their data assets.
In a few years, we will all need to learn these skills from our Gen Z colleagues.