What is your data worth?
How people might value their online browsing data if they had the opportunity to control the exchange in different data markets.
Online platforms generate enormous revenue streams by collecting and sharing web browsing data. It is unfortunate that the individuals whose data is monetized never get to participate in the transaction. In this post I explore how people might value their online browsing data if they had the opportunity to control the exchange in different data markets.
Personal browsing data has been called "the new oil" because of the way it fuels lucrative online platforms like Facebook and Google. Online advertising alone is projected to grow to a 389 billion dollar global industry in 2021. Unfortunately, most individuals never participate in this market and feel helpless to change the way it operates.
Do consumers value ownership of their data?
Recent research explored what consumers want from online platforms in exchange for their Social Security Number and health data. This was done by exploring two ownership lenses - someone's willingness to pay to delete data that has been collected or willingness to accept payment to share data. Asking consumers about sharing data they own or reclaiming data they don't own measures how much they value data ownership and control.
Results of the study suggest consumers are willing to pay much less to reclaim privacy from online platforms by deleting the data ($5/month) than they would like to be paid to allow access to the same data ($80/month). This unusually large disparity between willingness to pay and willingness to accept (1:16) is a kind of super-endowment effect. In other words, consumers value data they own much more than the same data when they do not own it.
What Motivates Data Ownership and Value?
The super-endowment effect demonstrated with data is bigger than most endowment effects seen in commerce (1:2), and this could be because of the characteristics of the exchange.
Different types of data
Prior research used extremely sensitive personally identifiable information (Social Security number, birthday, health records) and didn’t explore sensitive but less immediately identifiable browsing data that is commonly transacted on the internet (ads seen, content read, videos watched, search keywords, websites visited, time on webpages and your location). Understanding how valuation differs by the type of data involved in the exchange is an important aspect of data ownership and I wanted to understand if the effect extended to browsing data. I might see a smaller endowment effect with online browsing data if people don't feel the data is sensitive.
Different recipients and use cases
In addition, the study didn’t explore how the recipient of the data affects this super-endowment effect. Online platforms aren’t the only groups looking for online data to better understand the web. University researchers and journalists focused on improving an open internet need access to data that helps them demonstrate how agents are influencing people. I wanted to understand if a data exchange with a more altruistic internet researcher changes the way we value data ownership. Willingness to pay and willingness to accept money for data might depend on who is receiving the data and what they might do with it.
I ran a survey that explored the difference between online platforms and researchers when they are collecting online browsing data. To isolate these different contexts, two versions of a survey were created where the recipient of the data (online platforms, researchers) was changed across conditions in a blurb at the top of the survey. I asked 50 US residents per condition about how they value their data to get directional insights into their attitudes.
Willingness to Transact in a Browsing Data Marketplace
First I asked people how they value their web browsing data through willingness to accept money in exchange for data and willingness to pay money to delete data. I found a similar valuation for web browsing data as reported in prior work. People want more money to share browsing data they own ($100) than they are willing to pay to delete the same browsing data ($10).
Differences emerged when I looked at who will be using the data. People want more money to share their browsing data with online platforms ($100) than researchers trying to make the internet better ($75). A similar difference was present for willingness to pay to delete browsing data ($13.50, $10). This demonstrates that the recipient and the way they use the data influences data valuation. The super-endowment effect (1:14) was the same magnitude across online platforms and research recipients. While this effect was slightly smaller than prior work (1:16), it was still greater than the 1:2 ratio often found.
It is unlikely that users value their data less when they are giving it to academics or journalists. Instead, this might be a prosocial act where participants were willing to 'donate' part of the value of the data to researchers because everyone benefits from a better internet. More work is needed to understand this effect.
Data Sharing Sentiment
It is possible that you value your data but you have a negative reaction to participating in data markets. To better understand how these factors interact, I asked if people felt positively or negatively about data sharing.
Most people had a negative view of sharing their internet browsing data. However, they have more positive feelings about sharing their browsing data with researchers and journalists than online platforms. Forty percent of people indicated they felt neutral or positively about sharing data with researchers compared to 28% with online platforms.
Sharing equity in your online browser data
People's data sharing attitudes and valuation depend on who they are sharing this information with and what they might do with it. People felt more positively about sharing data with researchers at universities and journalists than online platforms. They also expected more financial compensation from online platforms.
Together, browsing data sellers may want to have different kinds of relationships with buyers in different data markets. All of these relationships will benefit from a marketplce with strong governance and protection to safely navigate a broad landscape of use cases and data products.
Could you see yourself participating in online data markets or do you disagree with this approach entirely? Reach out to me and share your vision of a more equitable online data market.
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