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Search data: Big Brother or deep market insight?
INTERNET companies are holding an enormous amount of consumer data that can provide companies with deep market insight.
A new study has revealed that, by tracking what individuals search for and where they go on the internet, the Googles and MSNs of this world know what people like and what is important to them. This data is then used to predict traffic patterns and set advertising rates.
This seems obvious, but the company behind the study, comScore, says its research is the first estimate of just how much consumer data is being held by internet companies.
Of course, privacy advocates are sounding the alarm. But it seems to me that the gathering of this data, if regulated appropriately, is an important part of modern life and commerce.
Up until now, consumers seemed to be rather unconcerned about the trend.
But when Facebook introduced its Beacon programme late last year, users were quick and vocal in their opposition to having their online transactions broadcast to friends — as reported in last week's Tech Talk.
The more time spent online, the more data is collected. comScore reports that the number of online searches entered each month has nearly doubled in the US since summer of 2006, reaching 14.6 billion in January.
Five large web operations — Yahoo, Google Microsoft, AOL and MySpace — record at least 336 billion transmission events in a month, not counting their advertising networks.
Information held might include someone's post code, a search for anything from the news of the day to cheap flight information or the purchase of a book — or maybe even one from Ann Summers!
Search companies have policies in place to protect consumers' names and other personal information from advertisers, but the system is not foolproof as activity can be tracked to a specific computer or household.
When you consider that many governments are talking about assembling national databases of citizens' DNA, the gathering of internet activity data for commercial purposes seems rather normal for our times.
People who want to interact online must understand that this is part of the deal. As result, their online experiences will be improved because they will be served content that is interesting to them.
To conduct the study, comScore observed the advertising networks, using different methods depending on how data is gathered by each internet company. This caused some variation in its brand-specific findings, but the firm says the overall picture is not affected by this.
Google collects scores of data, but only uses current information, rather than past actions, in advertisement selection. Yahoo collects a wide range of data across long periods of time. Mainstream media companies fall far behind, with some sites having as few as 34 points of data collected. But they are working to close the gap by combining data from various properties or with social networks. The most obvious and easiest solution is for these companies to outsource their advertising sales to experts at the likes of Google and MSN.
You can see why it is complex and understand why no-one has completed such a study in the past.
comScore points out that its study does not take social network properties such as MySpace, Facebook or Bebo into consideration.
Together, these sites must collect billions of data transactions daily – not to mention the personal information, facts and opinions people post to these sites.
We have very recently seen announcements from several major brands about plans to integrate with social networks. UK broadcaster Channel Five has announced that it is launching a new youth-focused news programme to be broadcast on MySpace. Rock legends REM are releasing their new album on Facebook and the people who brought us Wallace and Grommit have developed new characters to be launched on Bebo.
Collecting search data online is a necessary part of internet use. If you take away the commercial aspects of the internet, you will restrict its development and rob the world of much of the innovation that the medium affords.
Privacy advocates are right to highlight risks and we must be cautious about data collection and its use, but banning it outright means we would risk losing the baby along with the bathwater.
>>Sherrilynne Starkie is the managing partner of Strive Public Relations, a communications consultancy in the Isle of Man. She provides her views on business and technology each week in Tech Talk. Visit her business blog Strive Notes for frequent updates.
www.strivepr.com
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Saturday 04 February 2012
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