The Behavioural Data Dilemma

Companies are under pressure to behave with behavioural data

If you think that July is too soon to start getting ready for Christmas, you might want to think again. A recent Rakuten Marketing study of 6,000 consumers across eight different markets has found that almost half of shoppers had started to buy festive gifts by the summer months. The research is a clear reminder that brands should pay close attention to behavioural data. If not, they could miss out on valuable opportunities.

However, behavioural data is a double edged sword. While it can provide insights into what consumers want, it comes with an array of complications. Getting value from behavioural data is all well and good, provided it is done in the right way.

Know thy customer

Behavioural data can help you get know your customer on a much deeper level. Unlike static data it evolves over time, which makes it far more useful when it comes to personalisation and targeting. As its name suggests, behavioural data follows the behaviour of consumers in an attempt to understand their wants, needs, and habits. This is in contrast to traditional attitudinal data, which analyses attitudes rather than actions. Examples of behavioural data collection include tracking what pages and people someone engages with on social media, or what items they purchase on a retailer’s website. Building up a profile of someone is far easier when you base it on what they historically and consistently do, rather than what their demographic suggests they might do.

Mis-behavioural data

Behavioural data gives organisations the ability to understand the behaviour of their customers and users. However, this kind of knowledge comes at a price. One problem is that it can be difficult to know whether or not behavioural data is genuine. If someone is visiting a website to look at a certain product, how can an organisation know for certain that it reflects the customer’s own preferences? Amazon, despite its retail dominance, is often smirked at for its inaccurate targeted ads.

“The key here is while Amazon can’t get it right all of the time, they can get it sufficiently right most of the time to make a significant difference,” says DISRUPTIONHUB’s editor Kev Cooke.  “By exploring behavioural data and utilising the findings it’s possible to gain a serious advantage over those that don’t.”

Another issue with behavioural data collection is its intrusiveness. At what point does simple segmentation – which is so useful when delivering relevance to customers – become something more sinister?

Numerous high profile businesses have been criticised for misusing information. Only this month, Google was forced to admit that a bug in the Google+ API had allowed third party app developers to access not only the data of consenting Google+ users, but also of their friends. Google failed to conduct good data practice, which is damning enough. On top of that, the company found out about the bug in March and kept it under wraps until the Wall Street Journal called them out. According to Thomas Jackson, partner at Phillips Nizer LLP and technology law expert, Google hid the discovery to avoid being compared with the Facebook Cambridge Analytica scandal.

“There are differences, of course,” says Jackson. “Much of the outrage following the Cambridge Analytica episode resulted from the fact that a personality test was used to collect personal data which, unbeknownst to Facebook users, gave a third party access to their personal information, and was collected for use in a political campaign. In Google’s case, what actual use was made of the data by outside developers, at least at this point, apparently is unknown. Undoubtedly it will prove to be far worse for Google that it chose to cover up what it had learned rather than disclose it in timely fashion and announce what steps it had taken to prevent the problem from occurring in the future.”

Behavioural data is sensitive data, and malpractice can have serious consequences – not just for those who have their data accessed without giving permission, but also for the businesses that allow it to happen… Wilfully or otherwise.

Of course GDPR, the EU’s regulations have gone some way to addressing these concerns. Now, companies are expected to treat consumer data with far more sensitivity and respect. There can be no doubt that more conversations need to be had about the reality of cybersecurity breaches, the growing prominence of data privacy, and the tendency of businesses to handle data in a questionable way. When dealing with personal, behavioural data, these issues become all the more important.

Behavioural data is an important resource for organisations, but unless it is handled correctly it could become a serious hassle. Luckily, GDPR has made it a requirement for businesses in the EU to think very carefully about their data culture, and further regulations are expected in future. It might be impossible to stop organisations from collecting behavioural data, but in light of regulatory and societal pressure, they will certainly be on their best behaviour.

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