Hyper-personalisation of services vs data protection: a new trend or a threat to privacy

15 January 2024 | Knowledge, News, The Right Focus

Personalised communications and marketing messages tailored to the individual customer are now an fundamental and routine tool of modern and effective marketing.

Customised content, advertising on social media, or even shopping recommendations in online shops – messages and products that are tailored to the customer and meet his or her needs, or even create needs that the customer is often not even aware of – are the basis of marketing activities.

Hyper-personalisation: a world where machines know more about us than we do

Personalisation is already standard, but what happens when we move to the level of hyper-personalisation?

When marketing messages no longer rely on simple data analysis based on gender, age and past purchases, but are the result of advanced algorithms, machine learning and big data analytics. When we are talking about large-scale activities where consumer data collected from multiple sources (such as social media, purchase history, website activity, geolocation, etc.) is analysed by algorithms capable of detecting patterns and relationships invisible to the human eye (often even to the individual), privacy risks cannot be overlooked.

The resulting detailed behavioural profile of the user captures the user’s preferences, interests and behaviours and, based on this, predicts their future needs and customises content and services.

If we consider that we are not only talking about shopping preferences in a clothing store, but also a personalised workout plan in a fitness app, a shopping history in an online drugstore (often linked to a pharmacy), a streaming platform that suggests movies and series (based on previous choices), personalised newsletters, information portals (where a universal layout is replaced each time by information tailored to the user), it becomes clear that in almost every aspect of our lives and daily choices, our decisions are significantly influenced by marketing messages derived from advanced analytics.

If we combine the above examples, it is clear to the naked eye how pervasive this intrusion can be and how wide the range of our data is now available to service and product providers.

Hyper-personalisation and GDPR

The more data, the greater the risk of breaches, leakages or misuse. Despite the fact that GDPR regulations are now several years old, there are still many organisations that apply the data protection rules in an inadequate or even inappropriate manner.

The vagueness of the rules (which is in many ways an advantage of the new regulations) is also undoubtedly a gateway to abuse and irregularities. Moreover, the risks associated with hyper-personalisation include not only potential privacy violations, but also manipulation by using the collected data to influence consumer decisions.

The fact is, however, that deep personalisation is on the rise. Studies have shown that consumers are in favour of a personalised approach. And they see this kind of unique treatment as something positive that strengthens their commitment to their relationship with a particular brand.

Hyper-personalisation is a sign of the times

The new phenomenon of hyper-personalisation is the result of technological amplification, whereby previous personalisation, limited in its simplicity by technological capabilities, takes on a new dimension by fully exploiting the potential of AI, ML or Big Data.

The process of deep personalisation is also one of continuous, real-time optimisation. Algorithms fed by data are in a constant learning mode, allowing for continuous improvement and ever more accurate customisation of content.

Hyper-personalisation is certainly a powerful tool that has the potential to revolutionise the way we use and are targeted by services and products.

At the same time, it will undoubtedly reinforce the information bubbles in which we already live and will also be a powerful intrusion into our privacy.

These threats can be addressed through appropriate legislation or education to raise consumer awareness of the risks and consequences of operating in the digital world and handling personal data.

The future of hyper-personalisation therefore depends on how well we can balance these two aspects.

Product and service providers will certainly have to pay increasing attention to the protection of personal data and transparency in their operations, allowing consumers to have control over their data and full knowledge of how it is used.

 

Questions? Contact us

 Natalia Kotłowska-Wochna

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Contact us:

Natalia Kotłowska-Wochna

Natalia Kotłowska-Wochna

Attorney-at-Law / Head of New Tech M&A / NewTech Practice Group / Head of the Poznan Office

+48 606 689 185

n.kotlowska@kochanski.pl