Data Collection During The Holidays: Why You Should Care.

How Big Tech earns

Big Tech collects consumer data to make informed decisions about marketing practices. They want to use consumer information to sell ad space. In order for this to be effective, they need to use data to target consumers with products that have the best chance of selling. In other words, they are building out personalized and targeted ads.

Big Tech collects industry data from consumers and analyzes it to determine which products are most popular, in turn, they sell ads to the product producers and manufacturers to make more money. Ad selling is crucial to Big Tech’s yearly profit. Companies like Google, Instagram, and Facebook rely on yearly data sales for the bulk of their revenue. Over half of their yearly advertising profits come from the holiday e-commerce season alone.  In the fourth quarter of 2020, Facebook made $28.07 billion in sales. A 33% increase over 2019. While Google and Facebook are certainly at the top of the advertising industry, Amazon has come close with marketing sales. According to eMarketer, in 2020 Amazon’s U.S. advertising revenue hit $15 billion. They came pretty close to Google and Facebook’s $40 billion each.

The numbers keep rising every year with e-commerce continually and successfully beating out in-person retail. Holiday data exchange is such a powerful selling tool that advertisement production increases by over 50% during the fourth quarter. 

No data, no sales

The selling of consumer data to marketers for ad space is what makes the holiday e-commerce season so essential. It is the time of year where businesses make the bulk of their profit. It seems that every major brand and chain is jumping into the data usage pool. Amazon, Walmart, and Target are a few businesses that keep massive amounts of consumer data and use it to sell digital ads to marketers wanting to pitch their products. The revenue flow is shared between marketers and businesses, cutting out the consumers from a share of the profit.

Walmart specifically has been upping the ante when it comes to pushing advertisement sales. They have been looking to expand their marketing space after over a decade of trying to match industry top dogs like Amazon and Google. They have upgraded their advertising platform to where brands can now buy digital ad space from them more effectively. Thus far they have made over $1 billion from this change alone. While Walmart has made a successful push to extend their advertising arm, others are joining in. Many advertisers are hoping to entice manufacturers to buy ad space on their platforms.They are doing this by collecting large amounts of consumer data and then promoting it to marketers for use.

The industries who buy in

The top industries buying and using these ad spaces may surprise you. In 2020, beverages, dry goods, and groceries peaked with a 216% increase over the previous year. This makes sense considering the pandemic forced many to stay indoors and in-person shopping was pushed to the back burner. Many consumers are starting to utilize grocery delivery services along with curb-side pickup. The top food and beverage brands looking to cash in on this staggering growth include Kraft Heinz and Procter and Gamble. The goal is to tap into consumer insights to sell goods. They are looking for the best spaces to target consumers online and turn a profit.

Even popular grocery stores like Kroger are joining the advertisement production line. Born from data acquisition that has been in the works since 2015, Kroger Co. recently launched a private advertising marketplace.The goal of the space is to try and give brands an easy to use platform to help them buy digital ad space more efficiently. This way Kroger makes money from selling ads and manufacturers make money from selling products.

Other industries that saw significant growth are home improvement and consumer electronics. In fact, the tech industry is projected to make around 142.5 billion in sales in 2021. Moreover, about $11.64 billion will go towards advertising which, of course, means buying data.

What consumers see

With ad space flying off the proverbial shelf, the way it is turned and presented to consumers can take a multitude of forms. Most often, advertisers use campaigns to promote products and collect consumer information. For example, you might have been exposed to GAP’s “All Together Now” campaign where Katy Perry sings the peppy remix in comfy holiday sweaters.

While developing a campaign is a useful marketing strategy, what makes it pack a punch is cross-promotion. Basically, this is when advertisers promote products across different brands with similar audiences that are not in competition. Situations and strategies like these prove just how crucial data is. In order to figure out where certain audiences are spending their time and money, Big Tech needs your information. This way they can accurately sell ad space to make techniques like cross promotion successful. Brands want to know your email, name, city, zip code, and so much more. Not to mention knowing your likes, dislikes, click rate, and what you are adding to your shopping cart is also extremely useful. The big methods of data tracking in play here are online tracking and transactional tracking.

Online tracking is what we all are semi-familiar with. After all, millions of us accept the use of cookies everyday. However, online tracking can include much more. Big Tech gathers inputs like IP addresses, cookies, and browser fingerprinting to create a more holistic profile of a user’s browsing habits. Moreover, companies are even asking for your phone number as a way to unlock holiday sales.  As a result, companies can better optimize their sites, and for the purpose of holiday sales, tailor their ads directly to consumer preferences.

On the other hand, transactional tracking is even more useful for the holiday e-commerce season. This is when companies are tracking sales, shopping cart inputs, credit card payments, invoices, and shipping information. This sales data is helping companies stay on top of trends and identify new ones. It is what helps companies understand who their audience is and how better to track them. Of course, once you know who your audience is, it is easy to start selling ad space to marketing companies who are ready to make their own money.

Your data is constantly being collected in the background and funneled into campaigns and marketing strategies so that Big Tech and manufacturers capitalize on sales and leave you with little more than a personal ad recommendation.

Taking back what is yours

While many consumers report a preference for personalized ads, data collection leaves an ever widening gap between consumers and big business. The Facebooks and Googles of the world currently hold your data in their hands. In the 2022 holiday season, Google alone is projected to earn $53.47 billion.  For years, these companies have been selling personal data behind people’s backs — and the people have never seen any of that money. At Invisibly, we want to put your data back in your hands. You have value and the capacity for change beyond whatever profile Big Tech has on you. Now is the time to harness data for the better. Now is the time to own what is yours. Start using Invisibly today to get your cut of what Big Tech owes you.