Privacy and Business Models

adsOne of the very first concepts of RunSignUp was that we were NOT in the advertising business. This led to the corollary decision that we did not own or co-own customer data.

We made this decision for several reasons. First, we felt it set up natural conflicts of interest. Why would one race want an ad for another race to appear on their page? If we were selling email lists from one race to another, why would either race trust us? Second, there are much better places to advertise, with much larger user bases and communities. Finally, we felt if we were simply focusing on building a technology platform, that would allow us to be simple to understand.

As Ginni Rometty, the CEO of IBM says, individuals or customers own their data – not the platforms.” Tim Cook, the CEO of Apple says “When and online service is free, you’re not the customers – you’re the product.”

With all the rising storm about Facebook and privacy over the past couple of weeks, it seems our decision was pretty good! But it is worth exploring a bit deeper on a couple of fronts.

Advertising Business Model
The ad business model has been around a long time. We are used to it – newspapers and magazines and TV shows have been targeting certain demographics for years that advertisers choose to reach specific target markets. Asics advertises in Runners World. KMart includes sales circulars in the Sunday paper. Budweiser advertises during the Super Bowl.

The Internet has brought that targeting to a new level of visibility. Axciom had actually been doing it well before the Internet, but no one ever knew.

If you get to scale, the ad business is great – even after the past couple of weeks, Facebook is worth $462 Billion. For a “free” service. That money creates strong motivations to continue to collect information on people. Expect Facebook to make it more difficult to take information off of Facebook to stop the type of thing that happened with Cambridge Analytica. Also expect Facebook to gradually tighten up on affiliates (read this article if you want to know about the dark side of Facebook). But also expect Facebook to continue to charge for those types of services directly, and continue to feed their ad machine.

For example, the hottest thing now on Facebook advertising is Custom Audiences. Upload a list of emails, and Facebook knows who those people are and what they like and dislike and then finds other similar people to advertise to. So the analytics that Cambrigde Analytica brought to political campaigns is now right in Facebook (for them to sell).

Race Advertising
RunSignUp does not advertise, but what is a race director supposed to do? Our opinion is that Facebook and Google and other ad platforms are a fact of life. No different than Budweiser targeting Super Bowl audiences. While there are modest #deletefacebook efforts, the fact is there are a lot of potential participants for your race out there. And for many races, it is an important source of participants.

The bigger question for races is how will you use YOUR data. Do you share it with other races? Does your timer also use your data to share with a larger email list promoting all of their races? Are you putting personal data into untrustworthy hands, or worse in the hands of an entity that may not keep the data safe? Are you complying with child privacy laws?

National Sponsors and Strava
We got a few emails and questions on whether we were going to be going into the ad business when we announced our National Sponsor program and partnership with Strava. NO! The reason we did this was to help races. We do not share any information with Strava. If participants choose to join Strava, that is their own decision. We also felt Strava could be a platform races could actually attract runners from.  As we roll out future sponsors, they will be opt-in for races and we will try to bring value to races – and always keep privacy in the forefront.

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s

Up ↑