Eli5: Why/How do companies make so much money collecting and selling data?

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Is it really that valuable? How much are these companies shelling out to purchase said data from other companies?
And what data are they typically selling/buying?
I’m a fairly boring person. I just can’t wrap my head around some company wanting to pay for information about who I am, what I like, etc.

Curious if anyone can share more information on this business model/practice.

In: Economics

8 Answers

Anonymous 0 Comments

The most common way is actually by *using* your data to decide which ads to show you. They may only get a fraction of a penny per targeted ad, but doing it to 100 million people a day dozens of times a day, it adds up.

Selling raw user data, even if it’s millions of people’s, isn’t very valuable, because that would require the data buyer to also have a means to exploit that data.

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