Michael Becker, MEF PD&I Working Group Chair, spoke with Julian Ranger, Executive Chairman & Founder at Digi.me to discuss the personal data and identity marketplace. In their discussion, they go over what it takes for businesses to leverage data to serve individuals.
I sat down with Julian Ranger, Executive Chairman & Founder at Digi.me to discuss the personal data and identity marketplace. In this discussion, Julian shares his experiences on what it takes for companies to effectively leverage personal data and how to be of service to people today and in the years to come. Here’s a hint: “Working directly with the individual solves a lot of the businesses’ data problems.”
Business success in the figure will come from working with people on their terms, respecting their control and ownership of their data, and giving them value at every interaction they have with you. Businesses must be prepared to work with individuals on their terms, and rewarding them for their continued interest and support. This interview shows that it is time for businesses to reconsider how they use personal data to connect with, communicate with, and serve individuals.
Setting The Stage: The Personal Data & Identity Marketplace
The personal and identity market today is massive. Personal data collection and aggregation is big business. Billions of dollars are generated annually from the direct collection and exchange of personal data and identity by third parties (aka data brokers), and trillions are made by enterprise and government primary use and secondary exchange of personal data and identity.
Personal data is the new oil of the internet and the new currency of the digital world. Meglena Kuneva, Commissioner (2007-2010), European Commission
The collection, exchange and sharing of data is a trend that is not going to abate. In fact, Gartner believes that data sharing is a business necessity today. According to Gartner, “Data and analytics leaders who share data externally generate three times more measurable economic benefit than those who do not”.
Given the importance of data, then, an organization must learn to overcome the six data challenges put forth by Julian.
Businesses can trust because they have the tools to verify the individual’s assertions. If they are not using these tools, then they are working under faith, not trust. And, individuals’ have faith that the businesses will professionally render their services and properly handle and safeguard their identity and billing information.“
Six Personal Data Challenges
According to Julian, when it comes to personal data and identity management, enterprises of every size face six challenges.
- Access: Accessing personal data at scale can be technically difficult, time-consuming, and costly.
- Quality: The quality of personal data that can be sourced from the market today is notoriously inaccurate. Numerous studies report on this, e.g., 50% of data at leading marketing data brokers was inaccurate, 71% of people studied found data brokers held on them were up to 50% inaccurate.
- Normalization: Data can be very messy, e.g. address strings, date formats, name structure, and more are often not standardized and are difficult to manage. To effectively make sense of data, it must be cleaned up and normalized. Data normalization is the process of structuring and correlating data.
- Validation: This is the process of authentication of the data, ensuring that it is accurate and true to the greatest extent possible.
- Consent: Consent is the process of ensuring that you have permission to use individuals’ data. Consent, aka permissions management, is a complex topic. Not only is consent needed for primary data collection, but under new people-centric regulations, the purpose of use consent must also be captured and managed in addition to general collection consent. Moreover, obtaining consent is proving to be more difficult as people’s awareness of industry data practices and privacy concerns grows and as people adopt new tools and services (e.g., personal information management systems and infomediary services) to manage their data.
- Compliance: Organizations must comply with local, state, federal, and international sectoral and omnibus regulations regarding the appropriate collection, handling and use of personal information and identity. As of 2020, 10 percent of the world’s population will be covered by people-centric regulations, i.e., regulations that give people rights to their personal data. By 2023 this number is expected to reach 65 percent.
Managing these six challenges can be time-consuming and costly for organizations. In our interview, Julian, as well as many others in the emerging personal data economy, suggests that there is only one solution to this problem – that is, we must start sourcing data directly from individuals. According to these leaders, sourcing data from individuals will solve the access, quality, normalization, consent, and compliance challenges.
The Rise of Personal Information Economy & PIMS
The personal information economy is the existing personal data and identity marketplace with one critical change – the individual, the data subject, is an active participant in the management and exchange of their data.
The rise of the personal information economy has been forecasted for nearly three-quarters of a century. Thought-leaders, like Vannevar Bush in the 1940s and Julian and others today, have all envisioned a time when people can actively manage their identity and personal information. The time is nigh for this vision to become a reality. Changes in consumer sentiment, technology advancements (self-sovereign identity, the demise of the cookie), the rise of cybercrime, regulatory mandates, and the need for organizations to do more with less (i.e., to be more efficient) are all pushing organizations down a path to where, in the not too distant future, they will source authenticate data from individuals, and not from third-parties.
One of the most significant changes taking place is the emergence of the personal information management system (PIMS). A PIMS is a suite of software and services that will give people ownership and control over their data. Julian’s company, Digi.me is a PIMS, although Julian is not a fan of that term.
The reason why Julian does not like the term PIMS, he explains, is that he does not feel individuals are ready to “manage” their data. Julian notes, “The most important thing we’ve learned over many years is that individuals are not natively interested in their data…What they’re interested in is the end result. What happens with their data. What gives them value (Hear the quote on YouTube). For Julian, the key to success is not to focus on the tools, like a PIMS, but rather on the problems that an individual is looking to overcome or the opportunities they’re looking to realize. People want their “hyper-personalized outcomes,” Julian says.
Julian recommends that enterprises focus on their value propositions first and foremost and then on offering tools like a PIMS, like Digi.me. Julian warns that the first time people use a PIMS to determine the value an organization is offering them, they probably won’t understand what’s going on. But, they’ll be happy as they realize the value. By the second or third time, they’ll start realizing, “Oh, I am the center for collecting all my data, and I get all of these new value propositions.”
Julian points out that the recent COVID pandemic is a perfect proof point for the emergence of user-controlled data. People are starting to get exposed (pun intended) to PIMS tools and services to help them manage their COVID vacation status—like the IATA Travel Pass Initiative or the Good Health Pass. Both these programs are global and are at scale in the market today. They also leverage new self-sovereign identity (aka authentic data) protocols and infrastructure, which enhance the security profile and granularity of the types of data exchanged.
Requirements for success
Julian shared many insights in our interview, but one key point rang out loud and clear: Don’t wait, start preparing for the personal information economy now! He says, “If you don’t start now those companies that do will outpace you because they’ll be going through the evolutionary hoops to do it.”
Julian argues that companies should start with a simple thought exercise to prepare for the personal information economy. If I could get all the consent-based, permission-based data I needed, what would I do with it? What value could I offer? Why? Because soon – perhaps three, four, or five years from now – this is going to be the case. Data will be readily available. Businesses that have asked and answered these questions and adjusted their operations accordingly (especially when it comes to consent management) will find that they have a sizable pool of prospects and customers ready and willing to engage with them. On the other hand, businesses that have not done so may struggle as their operations become less efficient and profitable, and their customers move on to others that respect individuals’ digital sovereignty.