Wise or Weaponry: Consumer Targeting Through Psychographic Data Analytics

Dr. Jennifer Dapko , Florida Southern College

Consumers have become commodities in which digital traces of ourselves are mined into a trillion dollar a year industry. Our online and offline behaviors are tracked and documented in databases, in real-time. Credit card swipes, social media interactions, geolocation data, voter information, loan and mortgage data, and magazine subscription information are all examples of data that is collected to learn more about you. Consumer data is sold to advertisers who use information they have about us to create compelling and persuasive advertising delivered to our social media feeds, email inboxes, and mailboxes. Armed with the right information about you, companies are able to determine what gets your attention, what you like, what you fear, where you live, and with whom youre connected.*

Social media sites, like Facebook, monitor and collect data about your behaviors: who youre interacting with, the posts that you like and share, status updates and comments you make, locations of photos, messages you send to others, and the content you react to versus ignore. They collect data about who you are in photos, when using the facial recognition feature, and what you see, when using the camera feature.* Critics often lament that your data are kept even after you delete information from your profile. Facebook collects data about users to both customize the user experience and to generate revenue via its advertising platform. By collecting a wealth of information about its users, Facebook provides advertisers with an opportunity to aim its messaging at precise target audiences by identifying specific criteria that separate the most likely from the most unlikely buyers. Advertisers can select audiences based on characteristics including age, interests, location, consumer behaviors, connections, and attitudes.

Social media sites are not the only companies collecting and selling consumer data for big profit. For example, credit card companies like MasterCard and AmEx, and credit bureaus like Experian and Equifax, collect your information and sell it to retailers, banks, and governments. Additionally, third party data aggregators buy data from multiple sources and append all of the data together for a full understanding of who you are, what you do, and how you choose to spend your money. Acxiom is one such data aggregator. Acxiom buys data from companies that want to turn their data into revenue streams, such as credit card and credit bureau companies. It also sells the data it collects to companies that want to find their ideal audience and target consumers more precisely.*

Acxioms global consumer database spans 60 countries; it includes 2.5 billion addressable consumers, accounts for 68 percent of the worlds digital population, and includes over 10,000 data points (attributes) on individual consumers.* Companies can buy individual consumer data points such as income or hobbies, or they can buy prepackaged consumer profile data bundles with multiple data points for each consumer. For example, Acxiom sells Mothers Day profile bundles to companies aiming their advertising toward dads, since dads are a major consumer of Mothers Day gifts. The company has identified four types of Dad consumer profiles and their corresponding Mothers Day purchase behaviors:*

• The Generous Gentleman has disposable income and is predicted to spend it on fine jewelry for his partner. Jewelry stores and luxury brands would be interested in purchasing this data bundle.

• Department Store Dad shops at department stores and is likely to purchase a gift for mom at one. Macys and other department stores would be interested in purchasing this data bundle.

• The Getaway Dad is likely to surprise his wife with a relaxing cruise or other getaway. Cruise companies and other vacation brands would be interested in purchasing this data bundle.

• The Car Connoisseur is predicted to purchase a car for his spouse. Car brands would be interested in purchasing this data bundle.

Acxiom sells similar profile data bundles for consumers making purchases for: football games, Valentines Day, St. Patricks Day, tax time, Fathers Day, back to school, Halloween, and more*.

All of this consumer data allows marketers to identify more precisely their ideal customer, and thus increase the effectiveness of marketing expenditures. At the same time, consumers receive less advertising noise, and more targeted messaging that is most relevant to them. While the benefit to consumers is more relevant advertising, the misuse of our data could have harmful effects beyond its benefits, and more harmful than what we may realize. The risk to consumers is that some companies willarmed with expert data scientistsacquire, analyze, and use consumer data with questionable legal and/or ethical tactics.

One such example is the well-known incident involving Cambridge Analytica. In 2016, Cambridge Analytica, at that time a leading data-driven consumer behavior company, was hired by several candidates running for the United States presidency. The company was hired to use insights, drawn from data analysis, to create compelling marketing campaigns favoring its clients. Cambridge Analytica boasted having 2,0005,000 data points on every registered voter in the United States. This included demographic and psychographic information. In a business development presentation titled Data-Driven Political Campaigning: Winning in 2016, Cambridge Analytica reported owning the following data:*

• Individual Facebook profile information including likes (30 million users)

• In-depth Republican primary election survey data from the GOP (150,000 survey participants)

• Email data from Infogroup (60 million emails) and Datatrust (26 million emails)

• Member data from ForAmerica (14.6 million posted comments and 240 million posted likes across 31 million users)

• Nationwide voter files with approximately 50 different data points from L2 and Datatrust (160 million consumers)

• Credit files with 400 data points from Aristotle (220 million consumers)

• Nationwide consumer data with ~ 500 data points from Acxiom and Infogroup (160 million consumers)

• Election return results with 20 data points for national census tracks from Magellan Strategies

• Psychographic survey data (30 million survey participants)

Regarding the psychographic survey data mentioned above, it was found that Cambridge Analytica hired a company to create and administer a personality survey online through an application.* The true intention of the application was allegedly gaining access to Facebook profile information which was then captured in a database. This was done through a personality test, which consumers completed via a third-party application on Facebook. The application collected personality information, and more, for that individual. Hundreds of thousands of Americans took the personality survey online. By taking the survey, participants unknowingly gave the application access to not only their own profile data (including likes, status updates, and private messages) but also to their friends profile data as well. If you were a friend of a person who used the application, you would have had no idea your data was taken.

Knowing that personality drives behavior and behavior influences how you vote, Cambridge Analytica allegedly combined the self-reported personality test application data with harvested Facebook profile data to build a psychological profile of each voter in the United States. However, it was found that Cambridge Analytica was not targeting every United States voter, but rather the segment of voters they called The Persuadables.* Resources went into targeting these consumers, voters who the company believed were easily persuadable. Data scientists used analytics to understand The Persuadables levers of persuasion. They conducted large-scale analysis to identify triggers of what might move them from one state of mind to another.* The analysis included understanding why The Persuadables did what they did and why they believed what they did. Cambridge Analytica then created persuasive communications based on insights derived from the analysis. They called this campaign Project Alamo. Swing states were broken down by precinct, then Cambridge Analyticas advertising team targeted The Persuadables in each precinct. The Persuadables were highly targeted with digital advertising content through blogs, websites, articles, videos, and social media advertising. Facebook was the premier advertising medium to reach The Persuadables. The strategy was to identify The Persuadables and target them with content -- based on what they feared and what they liked.

A former business executive for Cambridge Analytica later testified that the ability to mine and use psychographic data with such precision should be classified as a weapon and is equivalent to psychological operations tactics used by the military during warfare.* Interestingly, Cambridge Analyticas parent company, the SCL Group, was a military contractor providing training to military groups on how to influence behavior of hostile groups including those in Iraq, Afghanistan, and Eastern Europe.*

Remember the personality test application discussed earlier? Ultimately data was reportedly harvested from more than 87 million Facebook users (though Cambridge Analytica insisted it had information for only 30 million users).* Facebook later said that the data collection method of harvesting profile information was a data breach and was indeed against policy. While Facebook acknowledged the data breach, it was not until years later that users were alerted.

Since 2016, numerous bills have been introduced to Congress related to data privacy and protection. Rising from how Cambridge Analytica used consumer data, the worry is that consumer data is being used in ways that we dont recognize, or in ways we didnt realize was possible. Some bills include the provisions for companies to transparently disclose what data is collected, how it is collected, how its used, and who its sold to. Some bills have also called for allowing consumers to revoke their personal data from a companys database.

Questions

1. Even if Facebook or other information providers dont break laws in sharing data, do they break a moral or ethical law in doing so?

2. Within about 10 years time, consumers will have about 70,000 data points defining them, currently with no control over that at all. Does this worry you? Explain your answer.

3. As individuals, we can limit the data we leak, but theres no way to completely get off the grid. Find the data and privacy information for one app on your phone or handheld device. What types of data does the app collect and for what purpose? Will you continue to use this app or will you delete it based on what you learned?

4. What rights should consumers have with regard to their data?

5. Search the congressional database for bills related to data privacy and protection. Read one of them and summarize what it says. Search the database for bills introduced and their status at https://www.congress.gov/search.

6. Some say that data is the most valuable asset on earth. Why do you think this is being said?

7. Which consumer behavior theories, principles, and concepts do you recognize in this case study?