The rampant use of social media sites and online networks has made personal information more readily available than ever. And with sites like Facebook constantly having their privacy settings and policies called into question, people are becoming increasingly concerned with monitoring and managing their online image. The issue of online privacy has helped spawn a completely new industry with startups offering a plethora of services centering on targeted marketing and persona information.
There are always two sides to any story, of course. Some of these companies are seeking to help businesses capitalize on this new and readily available personal information, while others take the opposite approach by helping individuals maintain online privacy and monitor how their information is being utilized. According to Forrester Research, online identity protection is now a $2.5 billion industry, and it continues to grow by 12 to 15 percent each year.
Sites catered to protecting individuals and small businesses currently offer a host of services—from monitoring what is posted about a person online, to tracking how a household’s children spend their time on the internet. Larger companies have begun utilizing the services of data-protection companies as well, which monitor clients’ sites for problems or security breeches.
For businesses, the key to capitalizing on your personal information lies in analytics. This analytics software works to find patterns in the data supplied by customers, which in turn gives businesses insight on how to cater pricing and promotional deals for maximum effect. Several startup companies have sprung up which specialize in these analytics, and many established software giants, such as IBM and Microsoft, have offered their own programs as well.
Social media sites are continuously looking for ways to mine your personal information and use it to create finely tuned marketing campaigns. Features like Facebook Places allow user to “check in” to various locations, which then have the ability to send you discounts and information on sales. While this may be a convenience if you are a true fan of the establishment, chances are you’ll be getting flooded by a glut of promotional offers in the not-so-distant future. Investing in this sort of location-based advertising is expected to reach $1.8 billion annually within the next five years, and it’s only one way that companies are looking to use personal information to peddle goods and services.
Currently there are few regulations to keep companies from using private personal information for financial gain, and the consensus from the nation’s top politicians is that some sort of safeguard needs to be put in place. Legislation is being drafted that would prohibit companies from using tracking software to harvest personal information without gaining the consumer’s consent first. Google has already begun implementing targeted ads in their Ad Sense campaigns, which helped spur growth of 23 percent in that division during the second quarter. As you can imagine, Google and other companies are lobbying hard against any sort of regulation; in the second quarter alone, Google spent more than $1 million trying to persuade the policymakers in Washington.