A Headline with a Head Injury

You're probably wondering about the title of this post. There is indeed a thread that connects these topics, and it's one you might not expect - the thread of how we use data.

• McDonald's recently made a viral round on social media with this photo of a note left on a nurse's meal in the United Arab Emirates:

There was a tremendous response applauding McDonald's for going above & beyond in their care for customers. One article I saw declared that this simple act of kindness was a "Master Class in Marketing".

• Facebook made headlines last fall with a story about how they were still able to track users of their mobile app even though those users had opted out of sharing their location with the app.

The uproar from the community was deafening. Many people declared that they were deactivating their account on the social media giant and class-action lawsuits were filed. On a Personal note, this caused me to uninstall all Meta applications from my phone.

The Difference Between the Good Guys and the Bad Guys

At the core, both of these events are the same. A massive company used data that was available to them. Neither of them actually broke any existing laws to do so; yet the responses from the public were polar opposites of each other. Why are these events treated differently?

What the Answer Isn't

At first glance, maybe the response is because of what was done with the data. McDonald's gave the nurse a free meal... they did something altruistic. Facebook, well... didn't. Their purpose appears to be to gather more location data to enhance their advertising algorithms, to make more money by providing tighter-grouped audiences to select from when you want to run an ad campaign. Is that enough to explain the backlash?

I don't believe it is. Yes, there's a difference in the reason for using the data, but that's a reason to celebrate altruism, not a reason to open a class-action lawsuit. We all signed up for Facebook of our own free will and (presumably) read the EULA, right? We know they're going to track us.

So if the use cases don't fully explain the difference in response, what does?

Not WHAT but WHO

I believe the answer lies in WHO the data will be used by. We talk a lot in technology about Zero-party, First-party, Second-party, and Third-party data. And THIS I believe is the explanation for the dramatic difference in response!

First, some definitions. What are these types of data, and how do they work? I like the simplicity of the explanation provided in this comic by Tom Fishburne:

Note that as the number of the party increases, our comfort with the use of the data decreases. Zero party and First-party data we like - we relate them to in-person brick-and-mortar "good customer service"... like when you go to your favorite coffee shop and the barista greets you by name and asks if you want your "usual".

But as the data gets used farther and farther from its source, we get uncomfortable. It can even get downright creepy, can't it? I can sit on the couch and have a conversation about cleaning the gutters on my house with my wife, and the next time I open my Facebook feed, it's full of gutter-guard installation ads.

How'd we get here?

It began in a well-meaning way - let's make our advertising more relevant! The premise goes something like this:

• People would prefer ads about things they're interested in
• Advertising to people who aren't interested in the product is a waste of time, money, and effort

On paper, everyone wins! People see ads relevant to their lives, and companies only advertise to people who are interested in the product. Should be a recipe for 100% conversions, right?

The problem is that we didn't stop there; we always wanted MORE. We continually looked for more ways to learn about people... how can we find out what's relevant to their lives? And so, like Batman in Christopher Nolan's The Dark Knight, we became intrusive. Always watching, always listening, hoping for that one little nugget of info that might make another sale.

So how do we do it right?

It's a tricky situation. Every person has a unique tolerance for surveillance and advertising. Even as I prepared this post I ran across a mixed response from my friends and colleagues in discussion.

I believe the right answer can be found in the following:

Use Zero- or First-party data.

Just like I don't base my personal friendships with people off what some other person said, I shouldn't base my customer relationships off 2nd or 3rd party data. Those data sources might seem enticing, as if they have some deep insight into my customer's behavior... but they're going to come off as creepy if I use them.

Show Empathy for your Customer.

McDonald's gained credibility through their use of customer data because the data worked in favor of the customer. They made it clear they weren't just trying to make a sale, but enriching a relationship. Have you ever had a friend who only called you when they needed you, but never just to say "hi" or do something nice for you? When marketing invades the social space, that's the feeling we have to try and avoid.

Assume you're gonna get caught

When you use customer insight data (even the 0 or first-party variety) that the customer is going to realize you did it: that when they read your email or text message or whatever, they'll go "wow, there were data insights behind this."

How does it change the equation? When we assume we are NOT going to get caught, we find ourselves aiming for more cleverness; like a magician with a deck of cards, we want to "wow" them with this thing we know how to do. The problem is that magicians never reveal their secrets! While that's good for a magic act, it's horrible for building a relationship. Transparency and honesty are the foundational elements of trust... and this is why McDonald's succeeded. The "how we did this" is front-and-center in their message to the customer. Note - it's much, much easier to be transparent and honest about using zero/first-party data, because people are much less likely to recoil from a direct interaction than they are from "hey we bought your search history from ___ and noticed you like our stuff".