Data Capitalism: Information is Profit

August 31, 2014
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Too much information! Big data may tell you everything you need to know, but there’s so much information out there and yet less and less time for you to figure out what to do with it. For anyone who’s watched Mad Men, or taken a course in Business Administration, there’s nothing new in this. The godfather of advertising and modern propaganda, Edward Bernays, called itThe Engineering of Consent.” Conceptually, the blending of data and unconscious desire is a one-two knockout punch; and we, as humans, are incapable of building up a tolerance to it. The headiest narcotic of all, it’s tied to which products we think about buying before we actually buy them, what we actually do buy, and what we buy together as couples and families. With the onslaught of mobile devices into our lives, data is now ubiquitous, an evergreen part of our existence. The rest of it boils down to the stores we troll, which stores close the deal, the brands, and the design. Bernays proved (in The Engineering of Consent, published in the Annals of the American Academy of Political and Social Science, March 1947) that these unconscious desires are as primal as any sexual desire or narcotic addiction.

So what data is a critical necessity and what is just lingering ostentatious garbage? Data used to focus on customer buying habits? Predicting spending routines used to mean fixating on historical data without ever showing interest in people’s attitude toward product, according to Professor Rajumar.Venkestan, who teaches Business Administration at the University of Virginia in an essay in the Washington Post. A new view on Bernays’ old school rules of thumb is that, as much as it’s important to know why a product is purchased, it’s equally as important to know how purchasers feel about it.

Data Capitalism: Information is Profit

Thanks to the onset of mobile devices, loyalty programs targeting customers can be as exact as a military sniper’s work. If a business wants to target already loyal customers and create new ones without wasting time on customers who are otherwise committed elsewhere, a company like Groupon can help. Although it’s had its financial problems, Google, like Amazon before it, is slowly coming into its own, as was evidenced in a Forbes report in May 2014, where the company rejected a buy-out offer of US$6bn. The bottom line is that, in a world where every blade of grass is mapped out by GPS devices, Groupon can give you a an almost instantaneous inventory of, say, old-fashioned diners where you can eat breakfast, an inventory that you can peruse and then choose from in your hotel room. From then on you get into what I call “the budgets and finickies”.

Data Capitalism: Information is Profit
Edward Bernays

Indeed, depending upon the metropolis you’re staying in, Groupon will find you coupons offering up to 90 percent off. Cheap is actually much easier than the finickiness, though. A good example would be my friend Tina and her shellfish allergy. Although she’s not actually a vegetarian, she only eats in vegetarian restaurants for the sake of being100 percent certain that not even a trace amount of shrimp or fish—which she is so allergic to it can kill her—will pass her lips. Through their app, Groupon will not only find you a vegetarian breakfast joint, but, with luck, locate one that offers paperless coupons.

Consequently, depending on your mindset and how much you choose to use the app, Groupon tracks your traffic habits and then comes up with personalized coupons ready to use from your exact location of the moment. Groupon is only one example among thousands. They were sharp enough to quickly figure out that using a mobile device as a marketing medium is a superbly effective tool to communicate with and a bargain for the retailer because subscriptions often cost them as little as $200 per month.

Other companies deal in loyalty apps. ‘Loyalty’ has always been seen as a commodity in the business world and I can remember my grandparents collecting pink and green stamps as rewards from supermarkets and gas stations. Nowadays, again because of apps, it’s all paperless. Customers can instantaneously track and manage points. Instead of buying that iPad, you may have enough loyalty points to get it for free!

Your mobile device is way past placing a shopping mall in your hand. It’s a bazaar with an inventory of everything. And although the specter of Big Brother may be worrisome to some, the notions of ‘public’ and ‘private’ are also undergoing their own revolutions.

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