The big data arms race part two: consumer perceptions

Guardian Media Network/GfK research finds that marketers may no longer be in the dark about big data and are embracing a tool that is now transforming their profession
• Part one: what marketers really think of big data, and why personalisation may have its limits

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The film The Polar Express is thought to have failed because the animated characters were too human-like: consumers can be 'creeped out' by personalisation. Photograph: Warner Bros/Sportsphoto/Allstar

Consumers, we found, generally have a poor understanding of the increasingly complex process involved in personal data collection and aggregation. Whilst this is perhaps no surprise, it is more worrying that 49% of consumers also consider companies are not clear about what information they are collecting about them.

Of course brands are understandably cautious on this point given the way consumer rights campaigners and the media can pick up on these issues. But, ultimately, opaqueness carries some risks as consumers can justifiably be upset if information then leaks out which is counter to their expectations.

Consumer perceptions of data-driven marketing

We argue that there is a case to be made for a much clearer dialogue between consumers and brands about the way their data are being used. Not engaging in a dialogue about this can mean that consumers are subject to occasional shocks when a particular aspect of personal data handling comes to light, often accompanied by a security breach.

But, in addition, we are seeing the way in which brands handle personal data increasingly becoming a differentiator, with 81% of consumers saying they are more likely to give their business to companies they can trust to use the data they collect about appropriately. So whilst it may be tempting to take a defensive position on these issues, the landscape is changing and this may well prove to be increasingly untenable.

One of the questions we posed in our previous article was: to what degree are consumers willing to have a highly personalised interaction with brands? Marketers are enthusiastic about the opportunity this can present for brands, and much of the marketing profession increasingly appears to be organising itself around the apparent opportunities that big data represents.

Our study among consumers found mixed enthusiasm among consumers. At one level this is attitudinal – many consumers appear simply not to like the idea of it. For example, an anaemic 27% of consumers think it is a "good thing" if the data that a company holds about them shape the way they deal with them. Arguably there is nothing in here that cannot be negotiated and we found that some segments of the market welcome it. However, the scale of the challenge is high. Attitudes are generally not favourable towards brands on this issue and we are starting from a position where there has been relatively little negotiation between brands and consumers about what is acceptable and what is not, to whom and in what context.

The limits to big data

A potentially more substantive challenge is that of the Uncanny Valley, the point at which consumers start getting "creeped out" by personalisation. This phenomenon was first identified in the 70s by Japanese roboticist Masahiro Mori, who noted that although we tend to warm to robots that have some human features we tend to be disconcerted by them if they start becoming too realistic. While there is not currently any empirical evidence to support this claim, it has nevertheless gained traction and steadily been gaining momentum ever since.

The Uncanny Valley effect has been blamed for the failure of a number of films that used CGI where the characters have been very human-like whilst the audience are aware that they are in fact animations. Polar Express is often cited as an example, where the effect left it with lacklustre box office sales whereas films such as Brave or The Incredibles used characters that were clearly not human and fared much better. Circumstantial evidence, to be sure, but interesting nevertheless.

While this phenomenon is currently little understood, there is nevertheless evidence that this is an issue that brands need to be mindful of, with 69% of consumers saying they find it creepy the way brands use the information they hold on them The key issue here is whether there is something more fundamental in our make-up that generates the dislike and fear of the automation of the personal. More work is under way at GfK to understand the scope of this but there is certainly much to be done to better understand these issues.

But if we accept the premise that there may be limits to personalisation (albeit which vary by consumer segment, category and so on), where does this leave the big data agend? Is there a limit to the huge ambitions of what can be achieved by technology?

This concern adds to those of commentators such as Nate Silver, who said: "It is questionable whether any computer will be able to capture the subtlety and personalisation that real human beings demonstrate across social contexts." In our study, for instance, we found that only 27% of consumers we interviewed considered that the products and services recommended for them are different from those recommended for other people. This does suggest that consumers are not always sensing that targeting is particularly effective. And surely this is another issue which influences consumer acceptance of data-driven brand experiences – if they are not seeing the benefits then the value exchange starts to fall down.

This is not to suggest that personalised approaches should not be used. Consumers clearly perceive value in many of the applications of personal data with, for example, 60% of consumers agreeing that not having to sign in every time they visit a site being useful to them. But we need to understand the limits to the benefits that personalisation can deliver. Not enough has been done to explore the parameters of acceptability or indeed the accuracy that big data can ever hope to deliver in the context of human attitudes and behaviours.

A new avenue for big data?

But perhaps there is another big data avenue that the marketing community needs to start exploring. This is one where brands generate an understanding of consumers through their data trails but in an aggregate rather than personalised manner.

These huge data sets provide marketers with a massive opportunity to better understand the way in which consumers behave. In one study at GfK we are exploring new facets of human personality through individuals' browsing behaviour, whilst in another we are looking at the way in which ideas spread through networks of friends and family as measured through patterns of sales activities. Both of these point to a way in which big data can contribute to a new agenda for marketing. One which complements the more tactical approach that current big data approaches typically offer but where big data can meet brand strategy.

Big data is an insight source of unprecedented breadth and granularity that can help brands to understand how to execute consumer strategy. In this new world, market research still has a key role to play – but often in taking the big-picture questions and seeing how we can answer them with these big data sets. And there are plenty of success stories where this has been the case, from a segmentation of a sales database to drive acquisition strategies through to analysing call centre records to establish the most effective means of customer retention and upselling.

This is not to say there is no case for personalised marketing but maybe it is one which ultimately has limits. And, as such, this points to a new role for marketing: one which utilises the power of big data but is not subjugated to it; one which draws on marketing expertise and applies it in a much more powerful and intelligently way through the use of big data. Maybe we need to start making a case for "big marketing".