Data still a double-edged sword

This week’s column was going to be dedicated exclusively to positive examples of innovation in data marketing, but events often overtake the noblest ambitions.

Two big bad news stories have once again shown that, while a potent weapon in the marketers’ armoury, data remains a double-edged sword. Brands receive a painful laceration, predictably, in the form of lost or stolen subscriber details.

Last week, Play.com sent grovelling messages to its customers apologising that their email addresses had been lost by email marketing agency Silverpop. The online retailer was responding to users’ complaints that spam had been sent to addresses attached only to their accounts on that site.

Days later, travel review site TripAdvisor was forced to do the same – this time as a result of a data theft. In both cases the companies assured their users that no financial or other personal details had been leaked, and that their passwords remained secure.

As I wrote two weeks ago, these kinds of breaches will continue to be hugely damaging for perceptions of the data industry. Whether accidental or illicit in nature, one mistake is too many for any brand – both because of the cost in trust and because of the harm that could be done to consumers, ranging from harassment to identity theft as well as the mere inconvenience of email spam.

As TripAdvisor’s CEO Steve Kaufer wrote in his email, however, the trends look ominous: “Unfortunately, this sort of data theft is becoming more common across many industries.”

On the other edge of the sword – let’s say the cutting edge, to stretch the metaphor – recent days have also seen positive indications of where opportunities lie for marketers in their use of data. Specifically, it is in the burgeoning mobile field, which has attracted a high-profile proponent in former Marks & Spencer executive chairman Sir Stuart Rose.

He has become non-executive chairman of Mobile Money Network, which is preparing to launch a mobile commerce service entitled Simply Tap. It allows users to register payment and address details so that they can pay for goods and arrange delivery by entering a code on an app or text message when seeing a product in store or in an ad.

Mobile devices are increasingly finding themselves at the heart of marketing, and customers’ data is going to be the lifeblood. It is not just going to be in retail environments – through NFC and RFID technology, consumers will soon be able to use their mobiles as credit cards, train tickets and hotel room keys, for example, while GPS already allows brands to communicate in various ways based on people’s locations.

When they sign up in advance and each time they buy something, customers are going to be transferring their data. The concepts are convenient and compelling, which will guarantee their widespread uptake.

Data is only going to flow more freely back and forth as a result of this new mobile paradigm. The opportunities for marketers as well as the benefits for consumers are potentially huge, but if consumers are to trust they can use these powerful tools safely, companies handling their data will need to be more secure.