Marketers Poised to Benefit From Government Distrust After NSA Kerfuffle

After news of the National Security Agency (NSA) data sweep, the public is losing trust in the governement, and even the President seems to have put himself in a delicate situation, as his call to reform the system is being questioned internally. This crisis of confidence begs the question, who should be trusted with data collection in general, and more precisely, aren’t marketers the best positioned to benefit from this government debacle?

This afternoon, the Privacy and Civil Liberties Oversight Board, an independent federal watchdog, is set to release a report showing that the NSA’s phone data sweep is illegal. In the 238-page document obtained ahead of time by The New York Times, the recommendation is that the government end the program.

nsa-logo-smallLast week, President Obama attempted to address the widespread privacy concerns by calling for a reform of the NSA phone data collection practices. His recommendation was that private organizations gather and store telephone data, taking it away from the NSA and thus ending the government’s implication in the whole process. However, the first obvious issue is to figure out how safe it is to trust private organizations with such data and how to make sure there will be no abusive use of the records — i.e. how to determine if certain private organizations are trustworthy.

The second challenge is the feasibility of the requested changes. The Washington Post quotes officials with knowledge of the discussion as saying that solving the problem in the next two months is “very unlikely, if not impossible.” Phone operators have already cautiously stepped away from the issue by saying they have no wish to be the repositories of the collected data.

Data surveillance issues run much deeper than simple phone records, though: the NSA has also been caught red-handed spying on Internet data. This prompted the creation of the reformgovernmentsurveillance.com site, where eight of the biggest Internet players essentially call on the government to respect individual rights.

It is interesting to note, however, that the government is trying to regulate data collection in other areas, namely marketing.

For example, during a hearing on the data broker industry, Senate Commerce Committee chairman Jay Rockefeller called them “worse” than the NSA and their practices “the dark underside of American life.”

However, although it seems rather counterintuitive, marketers are more likely to benefit from the NSA data spying kerfuffle than to be harmed by it. Supporting this view is the Edelman 2014 Trust Barometer, which shows unequivocally a sharp decline in confidence for the government in favor of businesses.

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If you can’t trust the government, and private Internet companies are calling on it to protect basic individual freedom, the balance of trust seems to shift away from official authorities toward businesses.

The Direct Marketing Association (DMA) is actively involved in the ongoing debate, as it was called to testify before Senator Rockefeller’s committee in December. Its interest is clearly to let data brokers do their jobs, and as of yesterday, the association is taking a proactive approach by calling on Congress to focus its legislative efforts around data policy on “Five Fundamentals for the Future” to protect the data-driven economy as a whole:

  • Pass a national data security and breach notification law;
  • Pre-empt state laws that endanger the value of data;
  • Prohibit privacy class action suits and fund Federal Trade Commission enforcement;
  • Reform the Electronic Communications Privacy Act (ECPA); and
  • Preserve robust self-regulation for the Data-Driven Marketing Economy.

While the value of these proposed points is another story altogether, it’s important to note how not only freedom but data security are at the forefront of their concerns.

As Congressman Lee Terry put it last fall, “Data is the new gold,” and it’s not only a marketing tool but also a competitive advantage for America as a whole. Commenting on the temptation to be to restrictive it terms of data usage, he said: “Going to a European privacy position would be deadly for innovation as well as economic growth. There is a reason why the U.S. is the dominant innovator in this area and Europe is not.”

Terry’s position is echoed by Matt Cahill, director of analytics and insights at Havas Worldwide New York: “Data is building the future, and it’s happening all around us everywhere. We are creating, collecting, and using data in ways no one could have dreamed 10 years ago — and we’re applying it to everything: to predict storms, to cure diseases, to make our lives easier, and answer questions about the universe. The conversation about how to manage and store all this new data is important, and it involves everyone. Ad targeting is just one facet of that.”

To provide a concrete example of how data is used and can improve everyday life, we have spoken to Isobar U.S. co-CEOs Geoff Cubitt and Jeff Maling.

Watch what they have to say about the concrete use and value of data, both large and small, from a user and a marketer’s perspectives:

So tell us: Do you feel your data is in good hands?

 

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