Why do companies buy and sell your information? What do they do with it
In: Economics
There are different ways it can be used. It can be used on an individual basis to determine whether you’re a potential customer for other services. A list of 5-star hotel guests might be valuable to a luxury car brand, or a list of people who recently bought houses might be useful to a furniture company or life insurance company.
Data is also useful on an aggregate level, helping spot trends. Maybe grocery store data showed a high correlation with buying certain items together, which helped show how products were being used together. This can guide new products or how to market them. Maybe there was first data showing a prevalence to people buying Velveeta and Rotel chili pepppers which lead to them being marketed together promoting spicy queso dip and driving up sales of both.
There might be correlations that are less obvious, too. Maybe there happens to be a connection between drivers of Honda minivans going to Starbucks while drivers of Chrysler minivans going to Dunkin. Marketers could try to win over customers from the other camp more targeted, or use that to lean into the trend and market harder to this identified niche.
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