Ethical Personalization:
The Creepiest Convenience
What’s the real price tag on a hyper-personalized checkout? At what cost comes an exceptional customer shopping experience?
At… what… cost?
Simply researching future purchases leaves behind a butcher’s bill of personal information that might be considered a felony if quietly collected in the non-digital realm.
Let’s reveal the unsettling details of how companies collect, trade, and utilize personal data under the guise of personalization – then look at how we got to this stage in human history, and whether we can hope for a comfortable, ethical, middle ground.
The Evolution of Data Collection
– Historical Context: The practice of gathering consumer data for marketing can be traced back to the early 20th century with initiatives like the U.S. Social Security system, which required extensive data collection. Companies like IBM, known for their tabulating machines, played a pivotal role.
– Modern Data Collection: With the internet, companies began to see the potential in collecting personal data for advertising. The attempted merger of DoubleClick with a data broker in 1999 highlighted the shift towards de-anonymizing online ads. While the merger was blocked, Google’s acquisition of DoubleClick in 2008 allowed for the linking of browsing data with identities, marking a new era in data monetization.
The Hidden Cost of Connectivity
Picture this: Richard prepares for a Saturday morning with his 7-year-old daughter, Gabrielle. Like millions of parents, he starts his day by checking the weather forecast and mapping directions to a nearby playground on his iPhone.
Now, imagine if a creepy “agent” named Gavin stood outside John’s window, documenting his family’s every move. Gavin, employed by the local chamber of commerce, tracks their activities and compiles detailed reports about their behaviors, preferences, and daily routines. The chamber then monetizes this information by selling it to local businesses eager to understand and target the family’s interests.
This direct surveillance would seem invasive and, yes, creepy to most people. Yet this scenario plays out every single day as businesses purchase detailed behavioral data to craft personalized marketing strategies and tailored CTAs for families like Richard’s.
Dual Forces of Commerce: Merchant Intent vs. Consumer Intent
– Merchant Intent: This represents the objectives of businesses, such as meeting sales quotas or promoting specific products. It’s the “supply” side of the equation.
– Consumer Intent: This is what drives a person to engage with and ultimately purchase goods or services. It’s shaped by needs, wants, and the influence of marketing, representing the “demand” side.
Invisible Observers: Your Daily Digital Shadow
Once Richard wraps up his preparations, he and Gabrielle head out for their day’s adventures. On the drive to the playground, Gavin pulls up alongside them and spots Emma gazing out the window at a digital billboard. He immediately alerts the chamber about this ad placement opportunity and the ability to target a young child’s profile.
Digital marketing. Spycraft. Whatever. Same thing.
The chamber swiftly contacts local toy stores, auctioning off the nearest billboard space. A local bike shop wins the bid, and an ad for a scooter instantly appears.
Gavin watches intently to see if Gabrielle notices. When she doesn’t, he informs the bike shop about additional billboards along their route, ensuring their scooter ads are more likely to register. He diligently records Emma’s resulting reactions, making a mental note to follow up on whether Richard eventually buys Gabrielle said scooter.
If that didn’t already make your skin crawl, as they all arrive at the playground Gavin finds a cozy spot behind a tree and pulls out his binoculars.
While observing the oblivious father and daughter, he notices other individuals of his ilk hiding nearby and realizes they are also monitoring Richard and Gabrielle. They exchange notes and data, building a more comprehensive profile of the unsuspecting family. This understanding, they claim, helps them better serve their customers.
Customer Experience or Surveillance?
Eventually, Richard and Gabrielle pack up to leave. Gavin and a couple of other watchers gather their belongings and continue their assignment. On the way home, Richard and Gabrielle stop for ice cream. Gavin notes the shop’s location and the amount spent.
This information will help determine what ads are displayed and how much he might be willing to spend on advertised items. After ice cream, John and Emma visit a toy store to window shop. Gavin, busy relaying the ice cream information to the chamber (Mint Chocolate Chip), doesn’t worry about missing this stop.
With today’s data haul, the broker now possesses an extensive amount of personal information about the family—and that’s just from one day of surveillance.
The Current Paradigm: Personalization
– Advantages: Personalization allows for continuity and consistency in digital experiences, enhancing user interaction by tailoring content and ads based on past behavior.
– Concerns: However, this personalization comes at the cost of privacy. Data is collected, stored, and shared across platforms, often without explicit user consent, leading to concerns about surveillance and data misuse.
The Reality of Digital Stalking
Alright, let’s pause this scenario. If it sounds unsettling, that’s because it is. In our society, we have a term for such behavior: stalking.
The tech industry, however, prefers to call it personalization. The ethics of which remain up for debate.
This scenario is my adaptation of a digital situation described in a paper titled “A Day in the Life of Your Data” by Apple – ironically, a company that provides the means for much of this digital data capture. In their paper, Apple uses the fictional story device usage to illustrate how companies can amass thousands of personal and unique data points from your devices, often without your knowledge or consent.
This data is then sold to third-party companies who have compiled thousands of data points on millions of people. And this happens every single time you interact with your devices.
Big Tech’s Privacy Paradox
In their paper, Apple claims to offer two options: first, to “Be aware that this is happening,” and second, to “Identify that there are ways for you to opt out of this.”
While these points and value propositions are helpful, they fail to acknowledge Apple’s role in creating the infrastructure that enables much of this digital stalking. The potential for data tracking is built into the apps in their app store and the browsers on their devices.
They also subtly suggest that if Richard had used their products for his digital activities, he would have had an extra layer of protection. It’s a clever pitch: “Use our products, our apps, and our online services, and you’ll be protected. Use our products, but not our apps and not our online services, and your personal information is at risk.” But this underhanded scenario isn’t unique to Apple.
Consider Google: of the $305.6 billion in revenue they generated in 2023, $175 billion came from Google Search. That means over half of their revenue stems from selling advertising space (and your personal information) on their platform. The list of tech companies profiting from personal data goes on and on—it’s safe to say the issue is widespread.
Ethical Personalization: A New Approach
– Anonymous Pattern Recognition: Instead of tracking individual identities, companies can use machine learning to recognize patterns in behavior anonymously. This approach respects privacy while still allowing for predictive modeling.
– Customer Data Ownership: The future of personalization might involve customers having ownership of their data, enabling them to control how it’s used to meet their needs, rather than having it exploited by merchants for profit.
Key Takeaways
The story of Richard and Gabrielle’s big day out highlights the invasive nature of current personalization practices. While it offers ecommerce utility and a tailored user experience, it often comes at the expense of privacy. Sometimes frighteningly so.
The proposed shift towards ethical personalization, where consumer intent drives its demand, not only respects privacy but also puts the power back into the hands of the consumer.
This paradigm shift could lead to a more balanced relationship between consumer needs and digital merchandizing offerings – fostering trust while creating shopper convenience. This is the way forward.
About Syntheum.ai
We help e-commerce retailers implement Agentic merchandising solutions that go beyond basic automation. By integrating truly intelligent systems into merchandising strategies, we help businesses unlock their full potential - delivering efficiencies that improve operations and redefine what’s possible in online sales.
