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A backlash is brewing: Facebook controversy offers a serious warning for Canadian businesses

John Ounpuu is co-owner of Modern Craft, a Vancouver-based marketing consultancy focused on helping brands keep pace with modern customers.

It’s tempting to feel a little schadenfreude for Mark Zuckerberg.

After all, who doesn’t find a bit of secret joy in watching the powerful squirm. And Facebook Inc. has certainly grown very powerful, with 2.2 billion active users and a 20-per-cent share of the global advertising market (according to global media agency Zenith).

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Lately, of course, Facebook’s power has been shaken by an avalanche of embarrassing revelations, negative press and government inquiries.

But before we take too much comfort from the fact that we’re not the ones squirming in the spotlight, there’s something we must recognize. This story contains an urgent warning for businesses everywhere – Canada included. A warning that all of us ignore at our peril: Treat customer data with respect or risk serious consequences.

Years from now, this scandal will be remembered as a moment of mass awakening. The vivid headlines are propelling data and privacy issues to a new level of public awareness. More and more people are realizing how much of their data is being collected, how easily it can be misused and how damaging those misuses can be.

This dawning awareness builds on a general unease that’s been brewing for some time. A 2017 Deloitte study found that 93 per cent of people want the power to delete personal data held by various companies.

A backlash is brewing.

For the moment, it’s focused on big tech companies, especially Facebook. But let’s remember: Facebook’s success hasn’t happened in a vacuum. Its business is subject to the laws of supply and demand, just like any other. In its case, the demand comes from the tens of thousands of businesses who use its data to reach consumers through highly targeted advertising.

Facebook has built an empire selling this service. And we – the data-driven marketers and the businesses it serves – are the ones doing the buying.

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Here in Canada, we’ve been buying a lot of it. Research from June of last year by Ernst and Young found that Canadian companies spent a whopping $5.5-billion on internet advertising in 2016. The 2017 figure was forecast to grow to $6.2-billion. Based on Zenith’s analysis of the global online ad market, it’s likely that around 60 per cent of this total went to Facebook and Google (or, as they’re known in marketing circles, the duopoly).

An average Canadian consumer – worried about privacy and fed up with data misuse – could look at these figures and reasonably conclude that we, the business community, are part of the problem.

Unless, that is, we decide to take action.

Royal Bank of Canada chief executive Dave McKay has already started calling publicly for stronger measures to protect consumer data: “We’re poised for a societal discussion on how we’re going to use personal information,” he said recently. “We may need regulation to help set the boundaries.”

Other business leaders would be wise to add their voices in support. But public statements won’t be enough. Idealistic talk must be backed up by real action. At the executive level and, especially, in the marketing department.

The required action here falls into two broad categories

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First, it’s time to revamp the way we manage consumer data – not just in the realm of advertising, but across all marketing activities. The goal here should be to treat this data with respect: to collect and store it with explicit permission, safeguard it with great care and use it with the primary aim of creating more value for customers.

And second, it’s time for a shift in tactics – away from an over-reliance on data-driven advertising and toward a more holistic approach that aims to meet customer needs across their full journey.

This means letting go of a lie we’ve been telling ourselves for years. Renowned marketing professor Mark Ritson sums it up this way: “Just because we can do a much more advanced job of targeting, [that] does not mean consumers want any part of it. In fact, they do not.”

A recent poll from Reuters backs Mr. Ritson up: 63 per cent of Americans want to see less targeted advertising in future. It’s safe to assume the sentiment in Canada is not much different.

These two actions – improved data governance and a more diverse and customer-centric marketing model – will protect Canadian businesses as the backlash against data misuse gains further momentum. And they’ll likely improve marketing effectiveness, too – re-orienting marketers toward doing what’s right for consumers, not just the short-term goals of the business.

So what are we waiting for?

It’s too easy to see this story as someone else’s problem – to dismiss Cambridge Analytica as a cartoonish villain, its actions far removed from the way we promote our brands. Really, though, it’s a dark reflection of all of us. Of what modern marketing has become.

Let’s take action to change this story now, before it puts us on the front page alongside Mr. Zuckerberg. Let’s show our customers that we’re part of the solution, not part of the problem.

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