The popularization of Data Science has led to the expression “Big Data is Big Money” and “Big Data is 21st Century Oil”. In this article I will talk about ways to monetize data for companies and individuals, as well as explain how profitable and legal is the purchase and sale of information.
As you know, profit grows with increasing revenues and reducing costs. In both cases, the data can be used in the following ways:
First of all, it is worth noting that some information is secret (personal or production) and is protected by law. Article 24 of the Constitution of the Russian Federation considers it unacceptable to disseminate information about a person’s private life [2]. Requirements for the protection of personal data (PD) - any information about an individual (subject of personal data) provided to another individual or legal entity, on the basis of which it is possible to directly or indirectly determine the subject of PD (name, date and place of birth, address of place of registration and residence , marital, social, property status, education, profession, income, passport data, phone and email) are regulated in Federal Law No. 152-ФЗ “On Personal Data” [3], government decrees, methodological mothers FSB crystals, Roskomnadzora FSTEK and [4]. Violation of these Federal Laws is governed by Article 13.11 of the Administrative Offenses Code of the Russian Federation, which prescribes a warning or administrative fine, as well as Articles 137, 140 and 272 of the Criminal Code of the Russian Federation, which imply criminal liability for violation of the Law on PD with the punishment of a fine, forced labor, revocation of a license, imprisonment up to 2 years with the deprivation of the right to engage in certain activities and occupy certain positions [5].
However, despite such severe penalties, PDs continue to be used “for other purposes” even by large and seemingly very reliable companies. For example, Facebook for 3 years paid $ 20 per month to users for collecting their personal data (browser history, photos, videos, geolocation, messages in social networks and instant messengers), then to use this information for marketing purposes. And the telecommunications companies T-Mobile and AT&T sold access to their customers' geolocations to “location aggregators,” which, in turn, resold them to other advertisers [6]. To legalize the use of behavioral information, in January 2019, the Russian Internet Initiatives Development Fund (IIDF) proposed amending the Law on Information to allow Russians to sell their own online data, receiving a monetary reward (no more than 60 thousand rubles a year) . The project involves the depersonalization of PD, their depersonalization, because the advertiser is more important about consumer behavior than his full name and address of registration [7].
The idea of monetizing personal depersonalized data is already practiced abroad, for example, the Digi.me platform, DataCoup. In Russia, such information about consumer behavior and opinions about products / brands and other entities significant for marketers is actively collected and processed by popular online survey sites: https://www.anketka.ru, https://onlineopros.com/, https://www.mobrog.com and other similar services, including affiliated with foreign marketing research companies. In such online platforms, an individual user receives a reward for participating in a survey, the template of which was pre-compiled by a marketer. Thus, an individual actually sells information about himself, but not personal data. A business can also legally earn money by selling information about its customers, acting as a Data Supplier for special third-party services - DSP platforms [8].
The DSP platform (Demand Side Platform automated buying system) is an auction system for advertisers that trades with Real Time Bidding (RTB), manages several Ad Networks and ad exchanges (Ad Exchanges), and also exchanges other data for the benefit of the advertiser in the digital RTB ecosystem. Using DSP, advertisers manage applications for placing banner ads and prices for the demonstration of targeted ads to individual segments of their target audience [9].
It is customary to distinguish 2 categories of data providers: those who supply the finished audience segments (Processed Data Suppliers), and those who supply the raw data (Raw) Suppliers. As a rule, data providers sell to DSP companies the history of user visits to sites and pages (clickstream), information about likes, share actions (clicking the “share” button) and anonymous personal information of their users (Fig. 1) [8].
![Fig. 1. Selling data to the DSP platform [8]](assets/images/mdb1.png)
Note that in the case of cooperation with DSP-platforms, we are talking about selling anonymous, depersonalized data about user behavior, and not about the full name, addresses, contact numbers and other information about the privacy of their customers. In particular, users are identified by anonymous numbers, and information that allows you to somehow correlate data with a real person, for example, an email address, is stored in a hashed form [10].
Sources of information about user behavior can be [8]:
Thus, the sources of "raw data" are quite legal, because anonymized data on user behavior does not fall under the action of 152-ФЗ. However, in order to avoid claims of Roskomnadzor and allegations of violation of the General Regulation for the Protection of Personal Data of Citizens of the EU (GDPR, General Data Protection Regulation) in force in all countries, including the Russian Federation, from 05.25.2018 [11], you should warn the user about the collection of user data and cookie. In this case, you must obtain user consent to the collection and processing of such information [12]. To create such notifications, warning banners are used, which are generated using services, for example, Cookiebot, CookiePro, OneTrust [13] (Fig. 2).
![Fig. 2. An example of a notification about the collection and processing of user data [13]](assets/images/snimok-ekrana-2019-12-29-v-1.09.23.png)
Having received the user's consent to the collection and processing of his data, you can offer them to DSP companies or data exchanges (Data Exchange). Selling data about user behavior to other advertisers through an exchange or DSP platform (Fig. 3), a business receives a fixed fee or a percentage of purchases made by the user.
![Fig. 3. Selling user behavior data for a DSP company through a data exchange [8]](assets/images/mdb3.png)
At the same time, aggregation of raw data about the user is performed on the side of the DSP platform in order to offer advertisements suitable for him. In particular, consumer interests and intentions are determined. All pages visited by the user are indexed for the content of keywords that reflect a certain topic. Each site and its sections are also classified by thematic affiliation. Then each segment in the taxonomy is described by keywords, the subject of the site and the frequency of visits. For example, if a user visited thematic sites and asked search terms with the keywords “car sale”, “Ford purchase”, etc., then he falls into the audience segment, which is necessary for the advertiser (Fig. 4) [8].
![Fig. 4. An example of determining the interests of a user based on his history of visiting sites [8]](assets/images/mdb4.png)
Technically, the data on user behavior is delivered as follows: the supplier receives a special code from the DSP company or the exchange, which, when the page is loaded, saves a cookie in the user's browser, with the help of which his further movements on the site and between sites are tracked. Typically, javascript or an invisible pixel picture is used for this. This creates a virtual "image" of the user, i.e. a portrait of his consumer behavior. The data collected in this way are marked by the maximum available number of parameters. It is also possible to integrate information with data from other systems, for example, customer information from CRM, in order to associate them with virtual profiles. In marketing, this can be used for customer return campaigns. For example, sending emails to clients of a certain category with an invitation-link to a specific web page or a picture-pixel in the letter itself. When a user opens a message in a browser or clicks on a link, cookies added in this way will allow tracking his profile in order to display targeted advertising in accordance with the interests of the client and the advertiser [10].
Online stores, professional social networks and recruiting services, hotel reservation and ticket sales services, as well as other online resources that hold information about user interests and intentions can act as a provider of data on various consumer segments. For such information, data consumers (DSP companies and data exchanges) are willing to pay from 100 thousand rubles a month for “raw data” and from 300 thousand for structured by specific target segments. Today, the largest companies on the Russian market include the following companies: Aidata.me, tBh (partner of the RTB company Auditorius), Amberdata, Adriver, Facetz, Pluso, Usefuldata [8]. Abroad, the data supply market is much more developed and the following organizations are considered the most popular Data Suppliers: BlueKai, eXelate, eyeota, Brilig, Lotame, nugg.ad, Weborama Adatus [10].
Summary
So, virtually any business can make money on user data, using it for its marketing purposes or offering it to a third-party advertiser. However, the law allows you to operate only with anonymized information, which contains anonymous information about consumer behavior, but not about the user's privacy. In order to collect such data, it is necessary to obtain the informed consent of the user by warning him about this using the appropriate banner. Becoming a data provider makes sense for a large web resource with high traffic (from several thousand unique users per day). Other, more “traditional” methods of data monetization (optimization of their own business processes and marketing campaigns) are relevant for businesses of any scale and can be successfully implemented with the help of a full-time analyst or external Data Science consultant.
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