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‘Drinking from a Fire Hose’: Has Consumer Data Mining Run Amok?

Data troves may help deliver value, but consumers tend to find them creepy

Knowledge at Wharton
Mon, 11/28/2011 - 14:10
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In a world of endless information sharing, consumers have become the product. Platforms such as Google, Facebook, Foursquare, and Twitter are the new factory floor, and online users who leave digital crumbs as they browse the web and tap into social networks generate data that can be bought and sold.

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Every tweet tweeted, badge unlocked, website searched, and “Like” button clicked adds to the growing inventory of user information. Data miners then sort it, package it, and market it, and companies use it to better target customers.

“Even traditional companies have discovered they can generate totally new lines of business by collecting and using their customers’ information,” says Andrea Matwyshyn, a professor of legal studies and business ethics at The Wharton School, University of Pennsylvania. From grocers to gas stations, retailers offer loyalty cards that track purchases. Visa has filed a patent for a method to deliver targeted online ads to consumers, based in part on their offline credit card spending. And through social media websites like Foursquare, people bring information about their offline spending back into the online world.

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