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We’ve all been there: You’re innocently scrolling through social media or searching online, and suddenly you see advertisements for items left forgotten in an online shopping cart; for the vacation deals you recently perused on a travel website; for the great new book you recommended to a coworker at happy hour. And the list goes on. Just look at social media, and you’ll see users express concerns about these types of highly targeted ads and even memes on Twitter, TikTok, and Instagram.

Businesses have a unique opportunity to recognize that the old way of data collection is no longer appropriate in the eyes of the consumer. In fact, according to a 2021 report from KPMG, 68% of consumers are concerned about the level of data being collected by businesses. And 40% don’t trust companies to use their data ethically at all. What’s more, in the same KPMG report, executives expressed the following about their data collection processes:

  • 29% admitted that the way their companies collect personal information is “sometimes unethical.”
  • 33% said that consumers should be concerned about how their company uses personal data.

More consumers opting out

This type of increasingly growing concern has sparked a bipartisan group of legislators in the U.S. government to propose a bill that would allow users to opt out of targeted advertisements and sue internet companies that improperly monetize their data. In anticipation of having to comply with such regulations, some tech titans are already taking steps to improve transparency around data collection.

For example, Apple introduced “App Tracking Transparency” in 2021. This feature, pushed out to all eligible iPhones, allows users the option to prevent apps from targeting them for advertisements — and most people did in fact opt out of ad targeting within the first six months of launch. Moves like this will continue to completely change the game for online ads as we once knew them. 

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The increased awareness among both consumers and regulating bodies around data should be alarming to businesses that traditionally relied on freely helping themselves to information from their customers (and potential customers) rather than asking permission to do so. If businesses want to continue to benefit from consumer data, it’s high time they start planning for the future of what data collection will — and must — be.

Top offenses

Some current offenders do all of the following discretely, without explicitly informing customers or asking for consent:

  • Following online behavior via IP addresses, web browser cookies, and device IDs.
  • Audio tracking via microphones embedded in mobile and smart home devices.
  • Monitoring behavior via physical security hardware in brick-and-mortar establishments.

Although these methodologies have been used for years, consumers still don’t feel comfortable about the level of information they’re “giving” to organizations simply by visiting their websites, talking about their products, or going to their storefronts.

In a 2021 consumer privacy survey, 46% of respondents agreed that they are unable to effectively protect their data. A further 76% said it’s too hard for them to understand what’s going on with their data and how their information is being used, despite companies claiming to be transparent.

Modern data collection methods

When it comes to modern data collection processes, complete honesty and transparency must be chief priority, or else businesses will be at a massive disadvantage when attempting to collect consumer preferences.

Gartner’s predictions for 2022 and beyond state that, by 2024, 40% of consumers will trick behavior tracking metrics to intentionally devalue the personal data collected about them, making it difficult to monetize. As Gartner notes, consumers have become increasingly aware of the mass amount of data that’s collected about them. In retaliation, they will share information about themselves that is not accurate. This completely defeats the purpose of any targeted marketing campaigns, which today’s enterprise tends rely heavily upon.

Furthermore, to maintain relevancy and keep an accurate pulse on customer preferences, organizations must fully understand what those preferences are — as well as what is driving them and the associated behaviors. Collect meaningful data that serves to cultivate a more personalized experience for customers. For instance, PwC found in 2022 that 82% of consumers would share some type of personal data for a better customer experience. This includes birthday and age, sex/gender identity, race/ethnicity, and more.

Transparent, meaningful data collection

There is a light at the end of the tunnel. Modern tools that leverage technology consumers already have on them all the time (smartphones) are able to help businesses ethically collect consumer app, web, and location data to aid in building a satisfied, loyal customer following. 

One of the biggest challenges businesses face is collecting data that makes consumers feel heard while also collecting and using it in a way they can trust. Collecting data on the consumer’s terms by putting them in the driver’s seat through surveys or allowing them to opt in/out of location services, for example, will help businesses regain that trust.

If people aren’t able to trust organizations and what they do with their information, data collection will only become harder and harder as time passes, creating a big problem for marketing and advertising teams across industries. It’s time to face the fact that transparent, meaningful data collection is the only way to ensure success now and in the future.

Vardan Kirakosyan is SVP of research and strategy for MFour Mobile Research

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