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Personal User Data Collection: Why Internet Companies Need It So Badly?
Days of analog data collection are long gone; computers are no longer machines that had very little ability to recognize a human being. Fast forward to the digital era we now have IoT (Internet of Things) that enables computers to recognize a person just by their voice, determine their height using a camera. Not just that, these technological advancements have escalated to a point where they can even predict your next move and also know about your likes and dislikes.
We are now a part of a quantified era where your browsing history can digitize your transactions and health condition. This has all been possible due to personal data collection. It is believed that 90% of the world's data was collected in the last two years. While some internet companies have been storing this data to analyze their consumer base, some have built a business of selling personal data of users to third-party firms for targeted ads. Let's dive deeper and understand how and why this data is used by internet companies.
What Data Is Being Extracted?
Businesses mainly target four types of data: Personal, Engagement, Behavioral, and Attitudinal. Personal data includes information about the user's gender, IP address, browser cookies, and identification numbers of their computers or mobile phones.
Engagement data shows user's interaction with websites, smartphone apps, social media platforms, paid ads, and customer support. The behavioral data has information about a user's transactions and purchase histories. It even includes a user's mouse movement information. Lastly, attitudinal data comprises information on things such as consumer satisfaction and product desirability.
While many aware consumers want no part of such data mining and targeted marketing, most users are oblivious of what data is being extracted about them and who's doing it. If the industry pundits are to be believed, the companies that control personal data will make such huge revenues in the future that they will be forced to protect their resources and lock consumers in their services to maintain their position.
How Is The Data Collected?
There are many ways and sources that companies use to capture data. They use high-end software to gather and analyze user data and convert them into metrics ranging from demographics to behavioral data. While the most common places to extract user data are websites and social media platforms, there are more interesting methods to do it as well.
One of them being location-based advertising that tracks the IP address of a device connected to the internet. It then creates a personalized data profile of the user which is used for pushing hyper-personalized relevant ads.
It doesn't stop there! Companies also dig up a user's customer service records to see how they have interacted with the support team. This gives them access to direct feedback about things they liked or disliked. Besides collecting data to improve their services, companies also sell this data to third-party firms and make huge profits.
How Is The Data Used?
As the use of the internet continues to grow, businesses have evolved with it and have managed to sell us more and more individually rather than shelling out huge sums on advertising campaigns. But one must wonder how they use the captured user data. There are several ways these firms make use of this data. Many firms use this data to better meet the demands of the consumers. Using this data, firms can alter their digital presence and services according to market trends.
The user data also helps firms adjust their marketing strategies by determining how they engage with advertising. This collected data also paves way for new revenue streams. Companies that capture huge amounts of data sell it to advertisers that push targeted ads to the consumers. And the demand for data is only going upwards.
Not all of it is bad. Some companies use this data to protect sensitive information as well. For instance, banks use voice recognition data to authorize a user and prevent fraudulent transactions. As data analytics continue to become more powerful, companies will look into more ways to capture data on more personal things. This will help them remain relevant in the market for days to come failing to do so, could rule them out of contention against other firms that capture user data.
Can You Protect Data Or Privacy Is A Myth?
After reading the aforementioned points you must be wondering whether your data is secure or not. Well, the answer is it's impossible to be connected to the internet without some form of information being collected about you. But there are ways to limit it by focusing on two things. For one, you can limit the information you provide on the internet, and the second is being low-key on the web. Fortunately, there are tools such as a VPN (virtual private network) that help you practice both these things. VPN is used by big firms, national authorities, and tech-savvy people to use secure internet connections.
Besides, a long list of data privacy law initiatives is pointing towards the fact that major firms are changing the way they use user data and protect it. Budding businesses have already begun forming strategies to protect user data and privacy. Apple's Tim Cook has been very vocal about data privacy and its importance. After the Cambridge Analytica scandal, there's been a major crackdown on major firms like Facebook about their data privacy policies. Well, it remains to be seen whether capturing of data will continue to happen or we will have strict regulations against it.