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Location Data Alert – Can Blockchain Enable More Transparency?

By Mike McGuire | December 20, 2018 | 1 Comment

MarketingMobile Marketing

Location data collected and utilized by so many of our favorite apps enables a bevy of convenience. Like getting accurate estimates of our commute time or being able to precisely track a run or bicycle ride. Not to mention knowing how to get to the nearest taqueria.

Marketers in many industries – particularly those in the food and entertainment and retail – benefit from the smartphone’s precision location capabilities.  At the core of this type of marketing engagement is the idea that if we know a consumer’s proximity to one of our spaces in the physical world, we can find ways to engage the consumer.

Then a few days ago, the New York Times published a story with the headline “Your Apps Knows Where You Were Last Night, and They’re Not Keeping it Secret.”  The story featured animated graphics tracking several individual customer’s daily travels in granular detail.

To me, the nut of the New York Times article is the observation that the information app publishers use in their terms and conditions to describe how location data is gathered and shared with third parties is often vague or potentially misleading.  Given the current backdrop of stories about tech platforms and mobile apps acquisition and exploitation of customer data, including personally identifiable information (PII), the Times’ story marks an important moment.  Just how far can we as marketers push the acquisition and use of the data that is gathered by smartphones and other connected devices?  A corollary question is how do we make our use of location data more transparent to consumers? Simply pointing to the app’s “terms and conditions” page filled with dense legalese could probably be challenged by some clever lawyer somewhere arguing that the “Ts&Cs” don’t really lead to informed consent.

I’m not descending into a hand of buzzword bingo, honest, but this situation might be tailor-made for an application of blockchain technology.   Leaving aside blockchain’s tie to cryptocurrencies and fully acknowledging the rampant hype surrounding it, some of blockchain’s key features might provide a way for marketers to leverage location data in a more transparent way.

Why blockchain: w/o need for centralized control (players are self-regulating)

First off, blockchain’s decentralized nature means that it’s possible to avoid one or a handful of players self-regulating or descending into a morass of bureaucracy. Next, it can be encrypted and only those with the right private key can access.  Also, the data contained in the blockchain ledger is immutable.  Data can be superseded but the old information is maintained. Thus, one can always go back and see the history of a given ledger entry.

If we consider the situation of marketing uses of location data, one important application of blockchain could be to secure and make transparent the sources of location data an app or brand uses to provide location-enabled offers.  The transparency comes through disclosing to the consumer what location data providers are being utilized. This disclosure could come via the app’s privacy settings, as well as the app settings for turning on or off location-tracking. An app publisher could show which location data providers they are using.  This would require the app publisher to ensure that they are using reputable location data providers.  To be clear, a blockchain implementation as I’ve described out would need to be a component of a broader privacy and customer data protection solution.

It’s just an idea.  But if you want to enhance your knowledge of blockchain’s potential use in marketing, check out our collection of research and examples of how brands and technologies are considering applications of blockchain.

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  • That’s an interesting application of blockchain. In fact, come to think of it, perhaps there are other marketing applications for a distributed ledger approach that would solve a problem that has not been effectively addressed by more traditional methods. Time to start a list…