The Great Data Heist: Is it robbery or are consumers giving away the family silver?

Consumers have long been holding the short end of the stick when it comes to ‘owning’ their own data. For years companies such as Google and Facebook have been free to monetise our attention and personal preferences, while financial institutions have built privacy firewalls to closely guard the valuable information they hold about us. When Clive Humby, co-founder of Dunnhumby in 2006 said “Data is the new oil” he was ahead of his time. Today, Data has become our most valuable resource, but its benefits have, for a long time now, overwhelmingly dropped into businesses’ profit lines and not consumers’ pockets.?

That was until the law compelled firms to make data available to consumers to use for their own benefit. The General Data Protection Regulation (GDPR) put control back in the hands of the people and gave each of us the right to say “no, please don’t track who I am and where I go online”. Ostensibly a European law, GDPR affects businesses and e-commerce giants all over the world because anyone that wants to do business with a European citizen, anywhere in the world, must adhere to the rules around data protection and consent or risk some pretty eye-watering fines.

Together with other regulatory changes such as Open Banking, which obligates banks to share customer data with any accredited business (with the customer’s consent of course) it has promised to open the door to a wide range of innovations that aim to improve customer experiences, or at least help us make some money when we hand over our data.

On paper these regulatory milestones have been a victory for the little guy, giving people more power over their data, so they can choose who to share it with, what can be done with it, and always be compensated when they do hand it over. But benefits on paper don’t automatically become benefits in the real world. Yes, GDPR has put technical and legal ownership of personal data back into the hands of the people, but the practical means to benefit from our own data are few and far between.

Businesses continue to ask a huge amount from their customers; for their identity and their attention and are also likely tracking their preferences and their behaviours too. Without some form of reciprocity this value exchange is unbalanced and that makes it, from the consumer point of view, unfair.

Consumers are increasingly waking up to this fact and buying from forward looking businesses that are offering a greater value exchange when they hand over data; whether that’s through alternative search engines that reward them for unblocking ads, cashback sites that share the spoils of customer acquisition with the person doing the buying, or more sophisticated and personalised customer incentive platforms such as the one we have built here at Reward.

For the last two decades, Reward has straddled the worlds of banking and commerce, turning transactional data into actionable insights for global banks and retailers, whilst ensuring the customers get more than a fair share of the spoils from their shopping. Today, those two worlds have collided, and Reward is at the forefront of a customer revolution that sees a more equitable distribution from customers’ data. We have made retailers and banks billions of dollars through our engagement programmes and given back over $1bn to customers in rewards to consumers. And we’ve only just started!

For example, on our platform the average customer earns over $140 in benefits per year with the most engaged 10% receiving over $330 of rewards each year, and the most pro-active and highly engaged customers earning over $1,400 per year! Our aggregated data shows that Rewards users monetise their data to circa $250m per annum and growing.

From the business perspective, the Reward platform gives both retailers and banks immediate, direct measurement of the behaviour change that their targeted rewards are driving, whether that’s measurable omni-channel sales for retailers and increased NPS, cross product holding and churn reduction for the bank. Customers on our platform are using their bank card 27% more often which moves our bank cards to the front of the wallet and drives primacy of their account.

Over the last 5 years we’ve driven close to $1 billion of sales for our 5 largest retailers and, on the back of that success, have seen card-linked-offers move from a trial to a firm fixture within marketing budgets and, in some cases, trading budgets. This is predominantly because results are highly measurable when compared to other marketing channels.

More crucially perhaps, members engaged in Reward schemes have +20 Net Promoter Score (NPS) compared to other customers of those banks, which means people are significantly more likely to recommend a bank when it uses customer data to actually improve the lives of customers.

Reward believes that you can do good and do good business. We achieve this through our “Give to get model”. By understanding the needs of our banking and retail partners and aligning it with what customers should want – a fair share. Around the world we are seeing the banks and retailers adapting to the changes in regulations and getting closer to their customers, protect their privacy and rewarding them for their loyalty. Surely this is the future of banking and commerce…