On the web I decide what I read, write, publish, bookmark and whom I add to my network. I have the autonomy to do things that ten years ago only institutions could – publish, distribute, build audiences, contribute knowledge, define concepts, ideas and get visibility, create a ‘personal brand’, sell and buy. An empowered user is a better user and best collaboration is between autonomous individuals.
Balance of market power
This change is in the balance of market power. With regard to data, companies benefit from data collected from their customers. The data is very valuable when analysed and applied to the business.
As much as the value of customer data is recognised, there is no reciprocal acknowledgement and recognition individual customers would find such data valuable too. And that they would be able to add value to the data. As a result, individual customers and users have no equivalent of analytical mining of their own data. There is much functionality available on the web, but little of it is ‘analytical’ or assists people to learn about themselves and their behaviour (notable exceptions are Wesabe, sugarstats, mint.com, chi.mp etc – heads up about others will be appreciated).
I’d like to be able to learn from all the data and purchase history I have on Amazon, in a place that I can call my own. I’d like to mine or analyse it myself. Combine it with my reading habits, travels (to make sure I have reading material for those long airport waits), with my calendar for people’s birthday to buy them a book, with my notes on vendors i.e. Amazon’s payment and delivery practices, my purchase history, my opinion about their prices, publishing trends and then share that with my friends as I see fit. A widget on a blog will not suffice as I need a space that is secure and private, yet shareable, and where I can run my own affairs. Applications and tools such as ‘To Do’ or shopping lists do not begin to cover the range of functionality I want to apply to my data. Amazon and other vendors collect my data for their own purposes. I want to collect it for mine.
The web has changed the nature of data in at least two ways. It commoditised data and as a result the context in which the data exists is becoming at least as important as the data itself – and this applies not only online. This is where a ‘relationship’ comes in; it sustains the data’s context and make the data more valuable.
Ecosystem with free & open data
We believe that customer data belongs to the customer and should be freely available to individual customer or user, in open formats. This will help the individual to become the point of integration for his or her transactional data. It will also encourage development of applications that enable individuals to enjoy the value they can add by managing and analysing their own data (buying behaviour, patterns and preferences) and potentially benefit vendors, if voluntarily shared by customers.
As in available without charge, for example, organisations shouldn’t charge for providing transactional data to customers.
Open as in open to the user and his ability to use his data. It doesn’t mean indiscriminately open and accessible to everyone. Open as in offering much greater control over data that belong to me, data that I create and manage. Open as in making my data available to me for further use. Open as in open formats, making it easy to develop applications and tools to help me manage my data.
Commerce is about conversations, relationships and transactions. Modern commerce has been reduced to transactions. the web has given individuals an opportunity to bring back conversations and relationships into interactions amongst themselves. Companies can take the same opportunity to grow relationships with their customers, changing the nature of transactions.
Companies need to adjust their behaviour and the flow and exchange of data between vendors and customers needs more level and balanced. The defining characteristic of such relationships is that both parties are comfortable with it, and mutually benefit from it.
- I have far more conversations than I have relationships – already true.
- The number of transactions is smaller than the number of relationships, in other words, not all relationships lead to transactions – at the moment, my transactions are not a result of conversations and relationships with companies and brands.
- Conversations and relationships are sound foundations for transactions – already my conversations and relationships with friends and contacts are increasingly affecting my decisions about who to transact with but still a long way to go.
- It’s not all about companies; the conversations and relationships are with my friends and contacts – companies need to become part of my network in order to improve transactions.
My data is an externality to purchasing transactions, just like attention is an externality to my reading, watching or listening to something else. Marketing lives off my data, advertising lives off my attention. My data (and by extension me) is not respected because companies can trade it as a commodity without paying for it. The way to address this is not to make them pay for the data (and create many snake oil intermediaries in the process) but to make it possible for companies to enter into relationships with the true owners of the data.
So what is to be done? How can one internalise the externality? How do I regain control over something that originates from me and is used in my transactions with others?
It is about finding tools and technology that give the individual sovereignty over his data, so he or she can exercise choice over who gets to see it and under what circumstances. This will change the balance of power and eventually demonstrate to companies that by respecting people’s data, and by extension, respecting people, they can make more money.