“Did you forget something in your cart? Only 3 model XZT Drones with on-board camera left in stock!”

“It’s time to reorder your BluView ComfortWear contact lenses!”

“Since you bought the OhSoSoft 100% cashmere gloves, you might like the 100% OhSoSoft 100% cashmere scarf.”


If you’ve ever searched online for a product or service — and especially if you’ve ever purchased anything online — you’ve engaged in a consensual information exchange with a vendor. Whether you formally acknowledge it or not, you gave your name and, based on the details of your visit, the vendors feed you what they suppose are relevant ads, emails and recommendations. Market leaders like Amazon, Netflix, and Apple are masters at this: their degree of  customization is astounding.

But as digital technologies have advanced, companies need to acknowledge that consumer privacy is at stake. People become data-sets, vulnerable to hackers. Customers receive little in return for information they provide—and they know it.

What if we reverse this paradigm? What if companies gave more back than just a tailored experience. What if they shared our own data with us—helping us learn about ourselves and personally benefit?

Consumer Data Exchange: Balancing the Give and Take

There’s good reason to do this. Social exchange theory—a powerful concept in social psychology—views social interactions as occurring in a marketplace, suggesting people perform a subconscious cost/benefit analysis to gauge the value of any relationship or interaction. In good relationships, benefits outweigh costs; in bad ones, costs outweigh benefits. When a social interaction tips too far in one direction, a relationship becomes unbalanced.

When companies provide information of value to consumers, they earn trust and loyalty. Customers will likely then share even more information about themselves, contributing to a more robust relationship. Essentially, a transactional information exchange becomes a relationship-based value exchange.

From Information Exchange to Value Exchange

What would that value exchange look like, and how could it work? Some companies are already exploring this area.

Consumer personal finance web site Mint.com, for example, segments data into information that lets subscribers compare themselves to other users in their age cohort, on the strength of anonymized data it collects about users.

Who wouldn’t want to know how their saving or spending stacks up against other people their age, in their city? Who wouldn’t want to benchmark their retirement savings to people in their age and income bracket? Or simply learn, at a glance, what is “safe to spend” and suggest what’s available for “fun,” while still living comfortably?

As a result, Mint.com can offer newer services to its more than 20 million registered users, providing its members information that helps them improve their financial livelihood. Mint.com’s value is returning the balance of ownership of data back to their customers.

Another example is electricity provider Direct Energy. Its customers learn how they use power, when they use it, and how to lower usage and cost by choosing different rate plans. By learning what energy costs at different times, customers behave differently, and more responsibly, doing certain activities at other times of the day. In return, Direct Energy builds a relationship with a committed and engaged consumer—less likely to switch, more likely to recommend the company to colleagues, friends, and business partners.

The Banking Analogy

TS450027407_webOne could think of this value exchange as analogous to a person depositing funds in a bank. When they do, the bank gets to leverage that asset, but the customer always has access to her or his money. The bank benefits from having access to additional capital; the customer benefits from knowing their investment is secure with a trusted provider, and gains a small stipend in return. It’s a win-win for both parties.

That’s what Mint.com and Direct Energy do. Each focuses on returning the value of data back to the consumer, without relinquishing their ownership of that data. The aim is to capture and exchange data with the consumer so that they can learn about themselves and drive greater value personally,  nurturing brand loyalty.

And as Mint.com and Direct Energy continue to interact with their individual customers and give back data that adds value, it’s not hard to conceive how their relationships will deepen, and the network of mutual trust will continue to grow.  Instead of information being furnished to companies by customers, the information exchange is mutual to the benefit of both.

So, let me propose an information exchange I hope will be valuable. What are your thoughts on this subject? Do you see value in reversing the paradigm for data exchange? I’m interested in readers’ points of view. Let me know, and I’ll publish the results.

Gajen Kandiah

Gajen Kandiah

Gajen Kandiah is a recognized leader in engaging the transformative power of digital information technology to create solutions for large, entrepreneurial businesses.... Read more