We generate data every day. From retweets and likes to blocked ads and opened emails, nearly every digital action we take creates a little snippet of information about our preferences.
Even something as simple as traveling with your phone in your pocket or downloading an application can spark vast amounts of insight.
This personal data gives brands a snapshot into your world. When you stack enough personal data assets together, it creates a much more accurate representation of the subject for anyone who might collect it. Think of your personal data like a flipbook. One frame can tell a simple story, but stack one frame on top of another, and suddenly you can see an entire narrative.
Personal data monetization makes sure that you, as the subject and creator of your data, can profit from its sale, analysis, and application by outside organizations. Right now, you’re giving away those frames. Thousands of companies collect billions of personal data points from millions of users every day and then use that data to turn a profit. In the first three months of 2021, Alphabet (Google’s parent company), Amazon, Apple, and Microsoft reported a combined revenue of $322 billion. Annually, the five combine for roughly $1.2 trillion and growing.
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Right now, thanks largely to external data monetization, five companies earn $1.2 trillion every year. That’s enough to rank 17th in global Gross Domestic Product, right between Indonesia and the Netherlands. And how much of that $1.2 trillion have you been compensated for?
For years, companies in all industries have made their terms and policies intentionally complex. By packing their official documents with jargon, they’re able to confuse and burn out potential readers, leaving the company free to insert terms that we may not typically agree with. The Digital Age created a digital treasure trove for tech companies looking to optimize their offerings. Every click, like, submission, subscription, view, impression, and engagement helps brands refine their offering through data monetization strategies like product development or, more typically, advertising. By compounding the personal data of millions of users, platforms like Facebook or LinkedIn create more accurate audience profiles that they can then use to entice companies to spend their advertising dollars.
Traditionally, advertisers took a less direct approach, casting a wide net across a region of the platform’s audience and hoping their message stuck with someone. By collecting user data, Facebook and similar organizations can offer advertising partners direct access into markets they know would be a good fit for the brand’s services—for a price, of course. Now, instead of paying a few dollars over and over again to find that needle in a haystack, the company can have a competitive advantage and pay a higher premium to advertise directly to their ideal customer.
The rise of governing policies like the EU’s General Data Protection Regulation (GDPR) or the California Consumer Privacy Act (CCPA) implemented regulations around precisely how organizations can collect and use customer data both internally and externally within their respective jurisdictions. According to these and many similar policies, brands must follow a series of data privacy principles, chief among them that we as humans have a right to know what personal data is collected, how it is collected, and what it is collected for.
By giving people the power to dictate their own data privacy terms, organizations can avoid the ethical challenges that come with data collection. Simply understanding how brands interact with and monetize our personal data is an excellent start. We want to know where our data is, that it’s secure, who can access it, and that it’s not being used for purposes that contrast with our values and beliefs.
Personal data monetization gives everyday people the power to set those terms and make those decisions for themselves instead of trying to sift through privacy statements packed with legal jargon. Likewise, the shift towards more user-controlled data monetization methods doubles as a way to help improve data accuracy. When we control the data we share and the organizations we share it with, brands receive more consistent and real time information than if the existing data was scrubbed from the internet by a third party.
The tensions with personal data monetization come when we think about today’s freeware approach to many apps and online services. It’s no secret that companies exist to make money. Freeware organizations argue that this data strategy of collecting and selling data is the only thing that keeps their offering affordable for its user base. Brands like Twitter are already exploring a subscription-style service offering that extends beyond their traditional free service.
Data licensing is a form of personal data monetization where individuals permit companies to access specific data sources—social streams, bank data, browser data, etc.—in exchange for financial compensation. Under a data licensing model, the individuals retain the ownership rights to their data and can select data sources they want to share. It’s the model we use at Invisibly to connect real people with responsible brands.
Data monetization use cases include platforms that offer points, discounts, and even cryptocurrency for the opportunity to license your data (and there’s no rule saying you can only license your data through one organization). Customer surveys are the most familiar opportunity for turning your data into dollars. Companies like Swagbucks or LifePoints ask their members to take brand surveys in exchange for points or discounts that can be redeemed for things like Amazon gift cards.
As the opportunities to profit off your data continue to grow, it’s important to remember that not all data is created equal. While all data certainly has some value, your ability to make money from your personal data hinges on the type of data you’re sharing and your demographics. Banking information, for example, has more value to the right customer than your Twitter feed, as does data from smaller population groups. So while someone may be able to sell the personal data attached to their Twitter feed, they won’t see the same returns as someone looking to monetize their banking information.
While personal data monetization is still in its early stages, as more and more jurisdictions adopt consumer data policies, the greater the market and data revenue streams will become. We are excited to help direct this transfer of power back into the hands of the people and usher in a new era of data-driven decision-making where users are viewed as people and not as commodities.
In fact, we developed an entire Invisibly Bill of Rights explaining our stance on data ownership, active consent, and more.
We would love to help you start monetizing your personal data. Ready to get started? Click here to join the movement.
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