Society needs to question how far we wish to embrace the efficiency benefits of big data
Customer data is becoming increasingly important for businesses – from supermarket loyalty cards to targeted online advertising. The more information that companies collect, the greater the need to protect it against hackers, but also the need to ensure it is used ethically and according to regulations.
The tension between monetising customer data and protecting personal privacy raises ethical dilemmas.
Currently, most customers are happy to share their personal data. But this could change as awareness rises, the granularity of data collected increases, and data protection regulation tightens.
The incentive to collect information can infringe on personal privacy. We believe companies must earn their customers’ trust by using information in an ethical manner that benefits the client as well as the business.
We expect difficult debates over what is appropriate use of personal information
From May 2018, a new EU regulation, the General Data Protection Regulation, tightens the security and use of customer data in Europe and could result in customers being less willing to share all their data. In the future, we expect difficult debates over what is the appropriate and ethical use of personal information.
Targeted adverts online are commonplace, but now TV advertising can be personalised too.
Already motor insurers offer discounts to motorists who install devices that monitor their driving style. Some credit scores are assessed using individual social media information. And companies can use customer data to charge people by their ability to pay: one retailer raised online prices to people living further from a physical store.
Society needs to question how far we wish to embrace the efficiency benefits of big data collection and analytics, versus the desire to defend freedom and civil liberties.
There are increasing benefits for government from creating centralised databases and using technology to enforce laws. But there was concern in the UK at plans to share 1.6 million personal medical records with a private company, despite the potential benefits from developing new healthcare technology.
A key issue for both governments and companies is that while each additional use of personal data may bring incremental benefits with only a marginal loss of personal privacy, in total there may be a fundamental shift in the balance of power within society.
In the future, the majority of our daily activities may be tracked and recorded by government or business for a range of purposes. This will bring greater efficiency and convenience, but it could also create new concentrations of power and mean that fewer aspects of our lives remain private.
The new General Data Protection Regulation covers all organisations processing the data of EU citizens. It has wider scope than previous legislation: breaches must be published within 72 hours and fines are higher – up to 4 per cent of global turnover. Companies can continue to seek consent to use data, but requests must be clear and specific – and individuals have a right to see data held on them or request its deletion.
The increase in rights and disclosure may prompt a corresponding rise in consumer advocacy and awareness. Might that provoke a cultural shift away from sharing all our data online?
This research was first published on 26 January 2018.