Your Data Trail Is Like a Gold Mine

Mundane events are like gold ore to the data miners. They convert that information into digital portraits of us that they can sell to advertisers.

Similes are the stock-in-trade of the writer. If you want to get across the essentials of something unfamiliar, compare it to something already known.

Sometimes similes suggest themselves spontaneously. Once, whilst walking through a crowded public market in Africa, it occurred to me that the sellers were like sea anemone, and I and the other buyers were like the tiny bits of food drifting by that they catch in their tendrils … or, at least, our money was like that.

Other times, dreams supply a useful simile. Just last night, for example, I had a vivid vision of a stylized meteor passing through the atmosphere, leaving a trail of distinct sparks that didn’t fade. (A real-life meteor would leave a wake of fire.)

So when I woke up to write this article about our digital privacy in a world of high-powered supercomputing and limitless data storage, I knew I was on to something.

No Such Thing as Free Social Media

Recently, I interviewed my friend and colleague Paul Mampilly for my monthly podcast. We share an interest in the data economy, and I put it to him that data itself wasn’t a commodity … it is a form of capital. He agreed wholeheartedly.

The major companies that dominate our digital lives, such as Google and Facebook, don’t charge us anything for their services to us.

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At one level, that’s because many of us wouldn’t pay for the opportunity to post pictures of our dogs for the whole world to see. But the more consequential thing is that we are doing those companies a huge favor by using their platforms. Every time we do, we contribute a tiny bit more to their stock of data capital.

Digital data behemoths mine our data capital like a vast ore concession. They drill into it like an oil well. Using ever-more sophisticated algorithms and parsing programs, they convert raw data capital into commodities they can sell, just as miners provide steel or drillers produce gasoline and plastics.

It all depends on the steady flow of data capital from you and me. That’s where my meteor dream becomes a perfect simile for the digital age.

As we go through our lives, we are like a meteor or comet shedding constant bits of data capital. At what restaurant did you eat dinner last week? How much did you spend on gasoline the last time you filled up your tank? What sort of doctor’s copay did you pay with your credit card?

Those mundane events are gold ore to the data miners. They convert that information into digital portraits of us that they can sell to advertisers.

With a high enough level of specificity, an advertiser can tailor an ad precisely to someone who ate at a French bistro, put $30 into their Prius and last visited a wellness coach. Or someone who dined at Applebee’s, spent $75 to fill their F-150 and has diabetes.

It all depends on the trail of sparks that we leave behind as we streak through life.

Innovation at Your Expense

The digital economy also depends on the ability to mine those sparks by searching for matches like your dinner bill, gas consumption and medical needs. If a company figures out a way to match those data points — sparks — to something such as your search history, they have “invented” a new product they can sell to advertisers.

Google announced last week that they had done just that. The company can now match your digital purchase history in a variety of contents — mainly credit card transactions — with all the information the company gathers directly from us, such as search histories, emails and customized preferences.

With that information, they can offer an unparalleled level of detail to advertisers. Instead of blasting out an ad indiscriminately at Prius-driving wellness freaks and pickup-driving patrons of chain restaurants, they can drill down to each with a different message.

Whatever you may think of that — whether it’s a useful innovation or a privacy outrage — bear in mind that commercial advertising isn’t the only kind.

There’s also political advertising. Indeed, the last three national election cycles have involved furious innovation in voter identification along the lines I sketched out above. We’ve got to the point where working-class voters hear one message about political reality, and well-heeled voters hear another entirely.

Might that have something to do with the wild, dysfunctional polarization of our electorate? Yeah, probably.

The Opt-Out Option

I’m one of those cranks who doesn’t appreciate companies’ double-dipping from my dealings with them. If I use my American Express card to pay for a routine visit to a gastroenterologist, I don’t find the resulting ads for colon cancer treatment “useful.”

They’re appalling, and Amex shouldn’t be selling the information that makes them possible to anyone, period.

Fortunately, if you agree with me, there’s a way to avoid having your digital sparks become part of the vast reserves of data capital out there.

Get a copy of my Privacy Code 2.0 report and learn how to render the trail of sparks you leave behind completely anonymous … and therefore useless to the data miners.

Kind regards,

Ted Bauman
Editor, The Bauman Letter

Editor’s Note: Google and Facebook see your data as a form of capital, but hackers, lawyers and the government have the ability to use your private information to ruin your life financially … or worse. Inside Privacy Code 2.0, Ted shows you one powerful tool you can use to encrypt all your calls, emails and text messages so that even if someone gets their hands on them, they won’t be able to read what you say. To learn about the invaluable tips and tactics in this report and how you can get your copy today for free, click here.