“The Covid-19 pandemic has highlighted the enormous potential of data to help overcome some of the world’s biggest challenges, informing critical thinking and guiding decision-making,” said Jonathan Westley, chief data officer for the UK and Ireland, and Europe, the Middle East and Africa, at Experian.
“Emerging from the crisis, data will be a vital tool for organisations to understand shifts in consumer behaviour so they can deliver services in rapidly evolving digitised markets,” he added. “We are not going back to the way we were before. If businesses are to survive the immediate fallout from the pandemic and thrive in the future, they must understand their new, post-Covid landscape.”
Last year, an investigation by the Information Commissioner’s Office (ICO) found that the credit rating agency and its rivals, Equifax and TransUnion, were “trading, enriching and enhancing” people’s personal data without their knowledge to develop products that were then sold to commercial organisations.
According to Experian’s Data Debate report, many people do not understand why their data is needed and how it is used. It said this hampered organisations’ access to data, and hence their ability to build better products and services. In the report, Experian warned that there was also some uncertainty within organisations as to what data they could share and how they could make it accessible, both internally and externally.
It also raised concerns over the way certain data regulations made it cumbersome to achieve outcomes that are beneficial to the public. As an example, Experian described how open banking enabled competing organisations to share data to deliver enhanced value to their customers and themselves.
“Even here we are seeing regulation making the journey an overly cumbersome and bureaucratic mechanism for what should be a simple data sharing exchange. Keeping people engaged throughout the customer journey is key and more needs to be done if the true benefits of such innovation are to be realised,” the report’s authors wrote.
Experian warned that businesses often did not understand what data they needed to analyse to deliver a specific outcome. In the report, it suggested that the best insights were often garnered from investigating a variety of different datasets with no set agenda.
“There is no upside for organisations in gathering data for data’s sake – this is a time-consuming and costly activity. However, they do need to be able to experiment within a framework if they’re to develop products or solutions that present real value to people,” the report noted.
Experian suggested that businesses need to focus on educating the public about how their data is being used. “People – or indeed any data sharers – need to see how sharing their information will benefit them or the communities they live in. Increasingly, people are prepared to share information if they understand the terms of the exchange and place a high enough value on the product or service they receive in return,” the report’s authors wrote.
Experian also recommended that organisations assess the risks that people may perceive in how the data is used, shared or stored. “If the value outweighs the risk, they are more inclined to share,” it noted in the report.
As people’s comprehension around the power of their data improves, Experian warned that organisations would need to work harder to prove the value of what they are offering in return. “If they can get their approach right, by demonstrating integrity through better data stewardship, transparency, accuracy and outcomes, then everyone stands to win,” it stated.
Westley added: “We’re seeing increased standardisation, better all-round data skills developed, consumers becoming more motivated to share their data, and safeguards put in place to maintain their long-term confidence. It’s time to deploy data in new, innovative ways that will create a vibrant UK data economy.”