A: I define ‘digital sovereignty’ as an individual’s authority and autonomy over the digital representation of themselves in society. Digital sovereignty should afford every individual a legal, commercial and human right to their personal information, their data, and the authority to oversee why and how their personal information is collected, refined and derived and who and when it may be accessed by and for what purposes.
The importance of respecting the privacy and sanctity of the individual is not a new concept, especially in the face of new technology.
In response to the introduction of “recent inventions and business models,” namely “instantaneous photographs and newspaper enterprise,” Justices Warren and Brandeis, in their quintessential 1890 Harvard Law Review article, helped establish the legal precedence for an individual to have “The Right to Privacy.” They recognized that these new inventions could be used to invade the private aspects of a person’s life like never before, which institutions such as the government, press, and other agencies, had an ever-increasing capacity to invade one’s personal space. In subsequent years, Brandeis continued to refine his position and in 1928 suggested that people had the “right to be left alone.”
The justices opened their article by making the point that “political, social, and economic changes entail the recognition of new rights, and the common law, in its eternal youth, grows to meet the new demands of society.” With the technological advancements of the last two decades, especially mobility, cloud computing, networking, machine learning and artificial intelligence, it is a time we recognized the need for new digital rights, as these advancements have made it increasingly difficult for people to retain the right to privacy or be left alone.
In the face of today’s innovations, the development of “the right to digital sovereignty” should be considered. Leading industry analysts estimate that by 2020 the average individual will have 10 connected devices associated with them, and the average household may have as many as 50. By 2025, these numbers may be quaint when one considers that 75 billion to 500 billion connected devices will be coming online.
Moreover, with 5G wireless, ubiquitous WiFi, and proximity networks being installed everywhere, including in commercial spaces like grocery and retail, as well as private space like the office and home, it is entirely possible that we will soon never be disconnected. As these new devices, networks and services evolve they are gaining the capacity don’t just collect data but derive insight and influence behaviors. Very little is known or understood about the long-term implications of these data practices on the sanctity of the individual.
Recognizing the need for and acceptance of digital sovereignty has never been as important as it is today, as society has never faced a situation where nearly every aspect of an individual’s life can be monitored, measured and assessed through connected devices and ubiquitous networking. The majority of people has little-to-no knowledge or understanding of exactly how their data is and might be used, let alone do they have the ability to control and wield economic authority over it. This latter point is crucial, since in 2011 The World Economic Forum publicly recognized that personal information was a new asset class and should be treated as such. In other words, given the concept of digital sovereignty, individuals, the subject of personal data, should have authority over its use.
Q: What are some examples of business models being built upon personal data?
A: The application and use of personal information has been the subject of business from the dawn of commerce, but it was not until the 1970s and beyond that systematic accumulation and application of personal data, at scale, started to be recognized as an important business asset and medium of commerce.
Initially, personal data was widely used for audience segmentation and analysis as well as direct mail. As the Internet evolved over the last quarter century, the ability to monitor and measure online behaviors — including search, click streams, content views, shopping behaviors, and purchases — became increasingly possible.
Institutions recognized that they could commercially benefit from the systematic application of consumer and shopper data to:
1) better understand their customers, i.e. intuit their preferences and intent,
2) influence and drive engagements,
3) simplify experiences and streamline operations, and 4) better serve people.
In recent years, as mobile phones and connected devices have become a mainstay of daily life, and as messaging services, machine-learning-driven and artificial intelligence-enhanced chatbots and services become more prevalent, the once anonymous consumer and shopper data have become personally identifiable, aka individual, data. Today, organizations across nearly every sector, including finance, education, healthcare, retail, consumer goods, media and government, are leaning on personal data to tailor and enhance their products, services, and campaigns to engage individuals, at scale.
For these institutions to further the benefits of connected services, they increasingly must become reliant on a cacophony of intermediaries, third-party technology and media companies, who recognize that they can create value from the systematic collection and aggregation of an individual’s information. By some estimates, the worldwide market for personal information and the data collected from connected devices will be in the trillions by 2020. In fact, McKinsey estimates that 80 percent of the Fortune 500 value, roughly $8 trillion dollars, will soon be, if it is not already, based on the intangible assets of data and is encouraging companies to actively pursue strategies to participate in emerging data marketplaces.
The challenge with these modern data practices, what many refer to as big data, is that the subject of the data, the individual, has little to no autonomy or authority over their use of this data. The industry has effectively sidelined the individual through the application and refinement of terms of conditions and service policies. In the age of the connected individual, the commercial equations are not in balance, people may be giving up too much when they buy a good or service or access the free game or media property. Privacy, it appears, is no longer a right but a luxury good.
Q: How can marketers gain the trust of individuals to voluntarily divulge personal information?
A: Marketers have known for decades how to encourage people to voluntarily divulge their personal information. There are tried-and-true methods for gaining access to an individual’s personal information, including the offering of incentives, such as a coupon or discount, running loyalty programs, and providing “free” services or products to name just a few. Alongside these incentives or programs, companies have learned to evolve terms and conditions and service policies to make it easier and easier to collect data.
In the excellent documentary “Terms & Conditions May Apply,” the filmmakers confirmed what we could have guessed or already knew: people tend not to read the Terms & Conditions for any product or service they engage with. The documentary is well worth seeking out on Netflix or elsewhere if only to laugh at those who (spoiler alert) signed away their ‘mortal souls’ as part of one fake set of T’s & C’s. The joke wears off pretty quickly, however, when one realizes that it could just have easily been “me” that agreed to those terms. None of the global brands chased down by the filmmakers regarding their terms of services comes out of it very well.
When it comes to gaining market trust, the most important thing a brand can do is consistently provide a quality product and service that creates value for and with an individual, and not from them. Over time, the consistence, effective stewardship and keeping the brand’s promise is the best way to build trust. Also, the standard practice for marketers to signal trust to the market beyond offering their products and services is through the consistent deployment and adherence to terms of services, privacy policies, and following privacy and engineering by design methodologies. Brands are also investing significant resources in data stewardship.
Securing people’s trust is incredibly important in this new era. It’s likely that one day “trust” will be the last key differentiator that a business may have to compete on. The challenge with trust, however, is that people’s trust is on the wane in the face of the rash of data breaches, whistle blowers, and government requests for device access. Edelman’s longitudinal trust studies are a great resource to monitor the ebb and flow of consumer trust around the world.
Trust may also be won by treating individuals as equals, and when brands and industry focus on creating value for and with people, not from them, the trust will be won. There are so many ways that this can be accomplished — one of them is for brands to join in and actively participate in the emerging personal information economy.
Q: Are there any examples of marketers successfully implementing a program like this at scale?
A: There are countless brands that are following the leading industry best practices; few, if any, however, are actively participating in the emerging personal information economy since it is just now coming of age.
Q: What can happen to brands if they don’t respect a person’s digital sovereignty?
A: Brands that don’t respect an individual’s digital sovereignty may face many repercussions. For instance, if they do not properly protect the data they collected they may face a data breach and run the risk of incurring costs, losing customer loyalty and reputation and may even face regulatory scrutiny and fine.
Also, in the future, they may find that they are unable to secure new customers, as the savvy, connected individuals may only engage those brands that not only adhere to the principles of digital sovereignty but also actively engage in the emerging personal information exchange marketplace and transact directly with individuals through personal information management services (PIMS).
PIMS are online software services that make it possible for individuals to collect, manage, and ultimately monetize their personal information through the burgeoning personal information marketplace, a marketplace where individuals can join in and actively participate in the value exchange for their personal information. In this new market model, people do not give marketers consent to take and use their data; rather they share access to their data via a PIMS. As along as the individual believes a marketer is providing value, then the marketer will continue to have access to the individual. If at some point the individual perceives that he or she is not getting value, then the individual will restrict or block the marketer’s access to the information.
Q: How important is digital sovereignty to a brand’s long-term competitiveness?
A: Depending on a brand’s business and where a brand conducts business in the world today, respecting an individual’s digital sovereignty is not just a long-term opportunity, it very well could become a commercial necessity. New regulations like the European GDPR, which will come into effect May 2018, mandates that a brand recognizes that an individual’s personal data is their own. Leading companies like Facebook are already publicly reacting to this and commenting that more innovation and value can be generated in the market by giving people more control over their data. The U.K. government, with its “midata” program, is asking certain services business to voluntarily participate in a program that ensures that data that they collect on people is accessible, readable and transformable. Today this program is voluntary; there have been signals that one day it may not be.
We are in the pre-dawn of a new competitive age, the age of the connected individual, and the third evolution of the rise of the personal information economy. It is critical that brands prepare themselves for what it will take to complete in this new era. To help brands with this we’ve envisioned a new approach to marketing, The Connected Marketer and we’re inviting anyone to join us to help shape and refine it.