Nicholas James warns that “you shouldn’t expect to make millions from your personal data”

By founding the newsletter and SC website a month ago, Nicholas James made his site Update. Specializing for ten years in digital advertising, he created for Influencia Participatory Media with a desire to analyze the changes that Web 3 (Blockchain-related innovations) would bring to advertising and media. More decentralization, less stolen data, reinventing the relationships between brands and consumers… Sounds like a catchphrase, but what’s behind it?

The Internet, we know. Web 3, much less. What will change in the other?

For years, we’ve all been involved in developing Web 2.0, but we’ve left content monetization and distribution to Google, Amazon, and Meta, which today earn tens or even hundreds of billions of dollars annually thanks to our data. This is what Web 3 struggles with, trying to return control to users.

Blockchains are rightly presented as a technology that puts an end to the theft of our data. This is an important topic for the younger generations…

Is this important to them? I would say yes and no. There are a lot of cases of schizophrenia because, on the one hand, if millennials declare in every study that they attach great importance to protecting their data, on the other hand, they continue to use companies that exploit them extensively like Instagram or Twitter.

Who initiated the movement then?

All generations, in fact. For me, there are several explanations for this. There is the regulatory context, the entry into force of the General Data Protection Regulation (GDPR) in 2018, which has brought personal data protection to the fore, and highlighted the abuses of companies that track us online. Then there are the tech giants who have launched measures to regulate themselves, both proactively but also in response to the many scandals that have dogged them, such as Cambridge Analytica for Facebook.

However, their very model of operations is called into question today…

Let’s say with web 3 we are monetizing our content. This is called content coding: for an artist for example, it is possible to do without a platform like Spotify to monetize their creations. This is what an artist like Piano King does who can, for example, grant access to their content only to fans who have purchased one of their NFTs (non-fungible tokens). The artist can push the logic even further by attributing to the owners of the NFT a portion of the royalties associated with this content.

What if you are not an artist?

Today, we see initiatives starting to emerge, often add-ons to add to your browser. Swash, for example, offers the user to install an extension and let them track it. It collects online behavior data with its consent and sells it to brands or marketing agencies that use it to send relevant advertisements.

The promise is to return the money generated from our personal data?

Yes, but you have to measure. Do not expect to earn millions of euros from your personal data. Web 3, in this area, will not be a revolution. You have to distinguish between the data (eg knowing I’m a man between 18-40 years old, and a sports fanatic) and where you’re using that data, ie the form of advertising. And in this duo between data and advertising, the former is worth nothing. Today, Google, Meta, and Amazon provide free data to their customers to bring home, because their real livelihood is broadcasting ads. And those brands that currently get everything for free may not be willing to pay for the same tomorrow.

However, many of them seem interested in the possibilities offered by these technologies…

Because Web 3 will reinvent the relationship between these brands and their consumers. Ultimately, we can imagine that the major brands will give NFTs to the most active consumers to promote their actions. It may be a Pespi customer who places a trademark sticker on a plot of land in the metaverse and earns NFTs as a reward. Or an Adidas fan who received an outfit in exchange for his avatar because he encouraged 100 people to watch an ad. They can even create governance codes that represent the same number of votes given to their ambassadors so that they can influence certain decisions of the company.

What’s the point for them?

Today, the majority of brands do not have the tools that allow them to identify and reward those customers who are very committed to them. Distributors are the intermediaries between them and consumers and keep this data. Web 3 could change that…

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