The world economic forum and many futurists believe personal data is the new asset class that will emerge as a competitive advantage for many marketers. It is important that marketers start using this data  intelligently, judiciously and in a manner that benefits and engages the customer. Else, this is one area that can have a severe backlash from customers just like the occupy the wall street episode.

Personal data may be the new oil but refining and using it sparingly with relevance is becoming a very important issue for marketers to focus and address.

Who is the owner of our personal data?

However,  there is an emerging debate around the ownership of personal data as digital outposts & sites are gathering data about customers like never before. Google recently released a new privacy policy last week which  redefines how this data will be used across all Google properties that we as their customers have an account. The new Google privacy policy reads " We may use the name you provide for your Google Profile across all of the services we offer that require a Google Account.....We also use this information to offer you tailored content – like giving you more relevant search results and ads...."

Clearly, the challenge that is becoming a key part of the debate is who is the owner of this personal data  and what of it can be used and by whom.

My View

I personally believe customers should be given control of their data. Customers must give permission about which of this data can be used basis their interests and lifestyle needs to companies, advertisers and marketers. And thereby brands can deliver value to these customers.

Imagine personal data lockers being available which customers can own for a fee(much like the demat of company shares that have happened over years across different countries & markets). There will be several central agencies that hold this data and provide access to customers  - with a front-end which provides flexibility to give permissions to customers to release this data for commercial purposes. If the past few decades were the era of credit bureaus, the coming decades are the era of data bureaus.

Imagine a customer wanting to buy a car ticks the check-box on the need or expresses the need to be a part of a community of interest.Many marketers and companies then vie to build a dialog and a conversation with the customer - not spam her with emails, irrelevant ads and messages on mobiles. All the searches that customer does then become available for relevant ads to be shown to her online. Then, the sales & marketing teams of different marketers & products unlock a new engagement platform to woo this customer.

The customer experience is therefore refined, relevant and customized like never before using the data that is in control in the hands of the customer. 

Imagine the power of this data. Imagine its efficiency. Imagine its effectivness. If personal data has to remain as the new oil, the control & flexibility must be in the hands of the customer.

I was reading an interesting article by Umair Haque on the threat of open customer rebellion and how industrial age businesses are completely unprepared to change the ways they  engage, treat and manage customers.He writes:

"Yesterday's massive, sprawling organizations could pacify "consumers" by buying them off with a discount or three, an overblown celebrity promising the moon, an entirely new "brand" designed as camouflage, or adding an extra blade or five, patty or three, or cylinder or four, and calling it "innovation." But that probably won't pacify people concerned not merely with what they "get," but with what, if anything, you're really contributing to society".

He goes to quote an interesting example:

"ING customers mobilised on Twitter and other social networks to protest at bonuses paid to bosses at the bank, one of the biggest in the country. The threat of direct action raised the spectre of a partial run on ING, terrifying the Dutch establishment. Fred Polhout, union organiser at the bank, says: "People were outraged. We heard about the bloated sums being paid again in the City and in New York; but suddenly the issue exploded on our own front door."

To me this is a lovely articulation of  how unprepared many companies are. It made me think of some interesting analogy of how new information age thinking has to drive changes in industrial age-mindset companies:

1. In the industrial age, there were labor unions who acted as interest groups for community who produced goods. The customer had no power as they were fragmented across markets. The information age is creating customer unions where customers come together to rally against companies which do injustice to them, their enviroment, their community, unfair business relationship & services etc. 
2. The labor unions could take the cause of only one company, theortically speaking. But, customer unions can have members across different products/brands across geographies and pose a larger threat.
3. The customer unions are self-engaging members who pose a potential threat to companies who undermine their power.
4. The customer unions can come together within a few hours and disrupt the brand reputation built over years by companies.
5. The customer unions have the power of internet, social media to engage & collaborate for this cause and will disengage once the cause is achieved.
6. If there were union leaders who drove the labor unions, here there are customer leaders who drive the opinions and issues. Companies need to identify them as they emerge from time to time for different reasons. But address them with agility.
7. Authencity and honesty will be the hallmark of successfully handling these customer unions and companies need to find new innovative methods of handling them openly & with transparency.

It's time companies and marketing departments realize this and find new ways of truly engaging with customers and their opinions.

Tim O' Reilly tweeted about an interesting interactive feature on NY Times on using the popular movies rented data on Netflix by neighborhoods and zipcodes in the US! It's a lovely little application that tells movies marketers the kind of preferences consumers have had in 2009. 

This made me reflect on the infinite opportunities that are available on how data can be used in a number of ways imaginatively. Imagine the interesting applications of data:

1. Grocery stores - Households and neighbourhoods that are calorie conscious and like exotic foods. FMCG brands can then use this information to do interesting promotions across different zones based on consumption patterns.
2. Fitness Shops  - Zones that have different membership rates and ability to differentiate fitness freak zones from the not-so-fitness freak zones. Nike could use this effectively to build a community of fitness awarness champions across zipcodes to make the zones fitness conscious and the based on the number of people joining the fitness campaigns the 'heat maps' can become more and more red everyday!

I was reading a post by Seth Godin on embracing lifetime value. He mentions in his post on the value of a two year contract for AT& T or Verizon as worth as more than $ 2000 in lifetime value of a customer to them. And he writes asking companies and professionals to embrace this thinking.

It's funny and I fail to understand how many companies don't understand this and still continue to acquire new customers by extending significantly higher promotional freebies than to their existing customers. The question really is, if am an existing customer, should I not expect better renewal privileges than a new customer rather than go to a new service provider?

This experience happened to me last week, when I tried to renew my broadband account of Tata Indicom, a leading ISP in India. I have been their customer  for over a decade now! They are currently running a new customer acquisition program, where new customers get 3 months of broadband free plus one month( T&C incl.) and a laptop sweepstake thrown in!  When I enquired, if there was anything of similar value, they did not have anything to offer for me to renew!! It made sense to let the existing relationship die and start a new relationship afresh!

The key here is designing and extending a customized tariff plan to such customers. It starts with the following steps:

1. Bring a culture a "customer-driven pricing" into the company. Rather than think pricing only for unknown customers, they should think pricing for known customers too. 
2. Banks have perfected this for years with credit scores driven differential pricing for customers. Similar thinking need to be extended to such service-driven businesses too. They should bring customer value-score driven pricing to existing customers.
3. Value scores can be built very easily.They know their vintage, usage, approx monetary value, cost-to-serve etc. to them as subscribers but they fail to take account of the relationship customers share with them. 
4. Online recharge and newer channels of customer interaction provides an excellent opportunity to bring this differential pricing to execution as they can really customize the pricing offers.