The Paradox of Data Tracking & Personalization

Donna Wertalik

Professor of Practice & Director of Marketing Strategy & Analytics – Pamplin College of Business

How much information are we handing out online without even realizing it? In this episode, Donna Wertalik, Professor of Practice & Director of Marketing Strategy & Analytics at Pamplin College of Business, talks about data tracking and the paradox of personalization. In a world where personalization is key to consumer engagement, it’s up to individuals to decide how much information is too much to give away freely. And, it’s up to lawmakers to help enforce those standards.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

The Paradox of Data Tracking & Personalization

How much information are we handing out online without even realizing it? In a world where personalization is key to consumer engagement, are we giving away too much?

Speaker 1: 

We have to think about ourselves from a psychological perspective in terms of consumer behavior. The regulations are there and the regulations will only hold if consumers abide by it, right? So, if you have an opportunity to give your information for a company to create something, whether it's an annual review of your year or custom products, the consumer is likely to do that. It's the reality beyond the sharing economy. It's the relevant economy. And, if you look at it even further, all we want is personalization. We want personalized communication, but we don't wanna give our data.

Speaker 2: 

This is Horizons, stories about what's next in the world. Powered by Compass Datacenters.

Speaker 1:

Your digital footprint is if you looked at all the different areas where you've gone [online]. So, when you start from the morning and click until the end of the day you’ll see some of your patterns, but then you pull back a little bit and look at it from a pattern standpoint in the last year or two years. It'll help to see, oh, you like cars, you like animals. You like education; you work here. These are things that are important to you. These are the people you love. 

You can [track it] with certain plugins where it can show your actual footprint and where you're being tracked. So then you have the choice of knowing where your footprint is, but I still wanna go to those sites cause I need to go to those sites.

So do I need to change my footprint? And if everyone's getting tracked, what can I do about it? 

It could be any points, you know? So if a company says, “give access to …all Facebook posts to see that.” That's where it starts. I mean, you already have the base of information that you've shared out. Now, you just connect with a different platform. And even if it’s [an activity like] seeing how old you look in 80 years or wherever it is, it's interesting. Right? And then it starts trending. And you're like, well, I wanna see what I look like when I'm 80. So once again, it’s that paradox of “don't take my data, but I wanna use it when I wanna use it.” It's kind of a have your cake and eat it too type of methodology. But I really, really think as we look along these lines, it is these massive algorithms and every company has them because that's where the money is, right? If they can recommend something and they're so spot on, you're like, “Are they behind me?” You know, it's 1984 George Orwell, Big Brother, except the one component that they didn't account for was us freely giving [out] the data. “Take it. I'm going on vacation. I'm going away. I'm depressed. I'm whatever it may be.” And they're using it. I mean, with Facebook tracking, they can tell within two days if someone's depressed and it's just based on behavioral, attitudinal, different movements, and different selections. It's an absolute science. 

From a data perspective, you can look at it in a few different ways. Obviously, they're always looking for data to monetize. So, you think about it from a standpoint of personal data, just average, you know, demographic, psychographic information that you could get – age, income, all of that – to engagement. How engaged are you as a consumer? What category are you engaged in? When are you engaged in it? Why are you engaged in it? And then looking at behavioral. Behavioral targeting is huge and you really, really look at it to understand the psychology of a person. What they would react to, what they've done as patterns in their past, and what they would be more open to in terms of providing information. And then, just attitudinal – how people feel about certain things. And all of this data is categorized. It's clustered. It's built into these mainframe algorithms to ensure that every time that we get online somewhere, the experience is more and more personalized. 

I think it started happening so long ago. So if you think about it, even with 2005, right? When Facebook came in, before that there was AOL messenger, and I think they stumbled upon the benefit of [data tracking]. And I say that because when you look at the earlier years with social media platforms, there was not an emphasis on getting your information. Twitter, 2007, all you had to do was pick a handle and go. But now, turn the clocks to the last few years with TikTok, and you need to fill out an entire profile of every single thing. And guess who you are: you're a 10 year old, you're an 11 year old, you're a 12 year old. They're grabbing you very, very early on to understand behaviors, to understand attitudinals, to understand what Gen A is looking for at this point. So, from that standpoint, I think that [media] look at it very differently now and they understand the [potential] monetization. And that's why the government has gotten involved in terms of what we are giving. What are we saying? What role does the government have? Because I think it was so new, they just kind of had it under the radar. It really didn't hit anywhere until all of a sudden privacy and lawsuits and issues started to really occur.

If you look at how much it tracks and for every company. So you look at some of the big companies that were always on, whether it's, you know, Google, Facebook, Instagram, LinkedIn. Wherever it is. And you look at those platforms and then you look at the brands that they work with and how the brands will utilize that. Do big brands have more access to better data, right? Versus smaller brands. Are smaller brands doing something more organic? 

It's a multi-billion dollar industry. It is not going away anytime soon. And as you consider the world that we have today and more of the need to have personalization … It's the definite paradox of this life. “I don't wanna be tracked, but I'm not sure why I don't wanna be tracked because I'm not that informed. I have no idea what my money is moving towards or what my data is worth. Now, this could be my consulting gig. How do I sell my data? How do I mentor others to say,  “This is what your data is worth? And guess what? We're gonna flip the tables on all the big companies and say, “Unless you pay me this, you're not getting it,” and we're gonna block it out and do something tremendous. 

If you think about it, ads in any form, it's slightly being done now where you can have an ad and it is a field you fill out, right? Cross match field. So for years and years, when you would do any form of direct mailing, all of a sudden your name would be put in there. So, that was the first level. Even with universities, there's a way to integrate data into a video. So it says, “Christian, come to Virginia tech. Christian, here's your name on Lane Stadium.” They're embedding your name all over. And, the student, the 18 year old, was saying, “They really want me, they know me, they've taken time to put my name.” So, I think it's that it's that high touch that it feels so customized, but that's on a very small scale. And I think once it gets larger, it's gonna depend on where your name is used and how it's used. 

If you think of it, the Surgeon General, whatever the case, years ago, said cigarettes were safe. And you even had [statements like], “Doctors prefer this cigarette over this cigarette.” But if you look at other countries with cigarettes, the pictures on the boxes [have] people with like black lungs. [That’s the difference between] countries and how they [advertise]. I think the same thing will probably come through with social media and warnings before you [share your data]. Or maybe included would be more apps for parents to track [content] your child [accesses]. Such as, “This is a danger site. Did you know your child has 10 online friends and no one knows who they are?” So, I think it's gonna be more [about] informing parents [and] being part of the process from a younger stage. 

If you had to look at … a photo book or something of your life and where you started, and how you've grown, and the different experiences you've had, and what you give more time to more pictures, to more attention to. How you share those, how they were shared in the past, how they're shared, I think it's your life, but it's, it's your life on the highlight reel…It's your life, but it's the best life ever. It's not real life. Most of the time, it's the life you want people to see. And that is something else in terms of the true digital footprint. [The true digital footprint] will show everything and you can see where you've gone and moved and pivoted, etc. It used to just be consumer packaged goods or different platforms. Now, it's for your life. Before anyone meets you for a job, they're gonna look online for you. And they're probably gonna look on LinkedIn and they're probably going to use the SEO mechanism within LinkedIn to see where you rank based on your skill sets that have been endorsed or recommendations. So, it continues to go on and on and on as it relates to all these different ways to control and understand and go back to the consumer with these insights. But, in a comforting manner, not in a scare, “we know this much about you.”

The Rise of Tik Tok

TikTok understands how to use data and information tracking to connect with their users. But how much of that will come back as a negative in the future?

Monetization. First of all, [TikTok] started and it was an extension of another platform. It started as a music platform. Once again, under the radar of enjoyment, everyone joined in. So I think as it evolved through, it started to catch fire and it started to catch fire with influencers that were in high school or college. And then you have all these other people that are feeding into it saying, you wanna be on the#ForYou page? Here's how you do it. Here's what you need to talk about. Here's what you need to hashtag. Here's how you need to get [on it]. So in essence, TikTok stepped away after a point and let the users do what they needed to do and got these influencers to really educate the world on how to have a really viral type of video, with an understanding of the time spent and knowing [videos are only] seven seconds.

So, they would only [film] in a short amount of time, because that's where the burnout is, too. If you look at focus and consumption, it's in very small pieces. It's not a long article… It is so much more visually depicted these days. And then the interesting thing was when it was up for sale, right? And all the technology companies were getting it and it looked like Microsoft was really gonna get it. And then it went to Oracle. So, you know, last year, I have a colleague there and I said, what's Oracle doing with TikTok. It doesn't even fit into the brand portfolio at all, and they said, “I have no idea.” I have no idea why they wanted it so much, unless it's kind of moving into the social sphere that we didn't expect.

… They're still figuring it out almost as they made the acquisition without knowing what they were gonna do. But knowing they were doing something really big when they accessed it. So, the success and the algorithms of TikTok rely upon consumers. Some people say, “Oh, I took TikTok off my phone because I was burning like two hours a day just looking at all these over and over again.” And you know, then you get lost in your own world and your own self. So, I think that whole,  just streaming streaming stream, you know, just scrolling, scrolling, scrolling, going through, going through that helps them to collect [data and information]. And once again, at every point they're tracking data, so they know what you would wan [in your feed].

Digital vs. Physical Self

Why are we not as protective of our digital selves when compared to our physical selves. We lock our house but not our data. Donna Wertalik discusses the contradiction between the two.

I've often looked at the digital self versus the physical self. And it's interesting, in a sense, when I have queried actual students and different generational cohorts and said, how important is privacy to you or tracking? Ninety percent of them will say, “We can't do anything about it. We don't care. You know, they're gonna take [my information], whatever.” And then I said, so let's transition to your physical place now. So you say, when you come home and all of this is open, right? Your windows are open, your jewelry, your money?

So I don't know if this is intentional because if you think about this world, we're a time-poor society; we're moving so quickly. And if we slowed the clock down and processed everything, as we were going through to say, “Hmm, I'm gonna sign up for this.” Am I gonna even look at that box that says, you're opting in to provide your data? They make the font so small. They make it so you're not aware of it. It's not a blaring popup. Maybe in years to come, it will need to be. But, I think consumers in the future are gonna have a lot more power with their data. As we collect more and more and start to identify different data sets with more influence, more behavior, more attitudinal, that it will be price per pay based on the data that they have.

Tracking During COVID

Two years inside thanks to COVID led to a mass increase of online socializtion. Giving brands access to even more data and information.

If we went out and surveyed the country on their awareness of how much they're tracked, there's no knowledge whatsoever. And especially coming out of, quite frankly, COVID. Socialization has become a huge thing. [Brands] looked to those communities. So if we thought we were being tracked earlier now, it's like nothing else, because all we've done is spend time the last two years online, zooming and videoing. [Imagine] how many different captures they've gotten for us. So, I can't imagine the amount of data points they have and how they're gonna serve it up. But I do think that's why certain new laws have come into place.

Expert insights

Beyond the sharing economy, it's the relevant economy. If you look at it… all we want is personalized communication, but we don’t want to give our data.

Donna Wertalik

Professor of Practice & Director of Marketing Strategy & Analytics – Pamplin College of Business

01

Do bigger brands have more access to and control over data?

read more

When Twitter launched in 2006, all you needed was a username. Today, sites like TikTok require you to complete a full profile of information. Who are you? What do you like? Before algorithms even start monitoring your trends, social media sites collect and use your personal data. 

As soon as you launch your account, more brands have more access to your profile data. For example, large brands, like Google and Facebook, share information with each other and their partner brands to help target and control consumers.

02

Why are we not as concerned about our digital privacy?

read more

If you returned home and every window was open, the door unlocked and drawers rifled through, you would feel like your privacy was violated. Then why don’t we blink twice when clicking online opt-in checkboxes? 

Many say protecting their digital privacy is impossible; if brands or scammers want the information, they will take it. This contradiction between physical and digital privacy is a side effect of quickly evolving technology — laws and customs have not had time to catch up. 

The future of data privacy includes regulations and standards at the federal level that will help protect consumers and their privacy. We will have more power over our own personal data, from more conspicuous data principles to monetization.

03

What is a digital footprint?

read more

Your digital footprint is the information about you based on your online activity. It looks at the patterns of where you go online every day. Do you like cars or trucks, dogs or cats? Where do you bank? How often do you check your email? All of this information can be used to create a profile about you that outside sources, such as big brands, can often see and use to target you. 

Digital footprints make personalization possible, but the data we publicize can make us vulnerable to internet fraud (i.e., identity or data theft), unwanted solicitations from organizations and companies, and more.

04

How did the COVID-19 pandemic affect online socialization, tracking, and personalization?

read more

We’ve spent the last two years online, streaming, Zooming, and working. This increased online usage has led to even higher amounts of data tracking. Companies are not only tracking demographics, such as age and location, but behaviors and attitudes too. Ever-increasingly smarter algorithms learn a person’s behaviors, and target them with extremely personalized ads. Some could argue that this played into the four percent increase in global online spending experienced between 2019-2020. The full effect is still unknown.