Using Data to Drive Behaviors: Good or Bad?
Michel Bayan, Co-Founder & CEO of DirecTech Labs.
Lately, there’s a big story going on about how a political consulting company misused Facebook users data to influence people’s behaviors and outcomes.
Now, in this case, we would say that this is bad and most people would agree that there are some questionable activities going on there. People gave their data for a reason. They didn’t necessarily know that their data was going to be used against them, to influence their political opinions, and to drive them toward a specific outcome that wasn’t necessarily in their best interest.
Data gathering tools are gaining a bad reputation but if you think about this technology, you should know that (A) It is not new and (B) it isn’t inherently good or bad on its own.
Technology is neutral.
How you use this data defines right from wrong. So how are some companies using this data for good?
Netflix is a great example. They use the data you give them; what show you watch and how you rate them to predict what you want to watch next. In the direct selling context, a Netflix subscription is similar to an auto-ship. And, Netflix’ goal is to keep you on that auto-ship -similarly with direct selling companies. They put something that you want in front of you so you keep on doing business with them.
As a matter of fact, the data that Netflix has on you is worth over a billion dollars in retention revenue for Netflix. And, most of us would agree that Netflix uses data gathering and analytics to help provide a better experience for their members
Many could argue that the way the political consulting company exploited the information of 50 million Facebook users to influence people behaviors is bad. Adversely, it could be argued that Netflix gathering data on its members to provide them with a better experience is good
How can direct selling companies benefit from the data they already have in their field to help provide a better experience for all while keeping them on auto-ship?
This is where DirecTech Labs comes in. We’re using the data that our direct selling customers provide us to give distributors and customers an experience that meets their personal expectations as opposed to pushing a one-size fit all experience direct sellers want customers to have
We now realize that it’s much more efficient and much more effective to understand who my distributors and customers are. What are their favorite items? What color do they like? When are they the most active as distributors? How often do they recruit? Pushing a customer to recruit will certainly not help keep their business.
Some people are going to be leaders. Some people are going to be customers. Some people are going to be some of the categories in-between.
Understanding who they all are to give them an experience based on their identity can maximize their lifetime value as distributors or customers and give them a higher quality experience for you and your brand. Which leads to more revenue for you, more positive PR, and a lot less regulatory scrutiny.
So let’s think about this as we move into the future of direct selling and all these other brands are already using this for years now. We’re kind of late to the game and direct selling but will make it happen.