Data is power in the digital economy. Multi-national corporations have made farming data from monitoring everything we do – what we buy, who we talk to, where we take vacation – a core business strategy.
The pace and scale of this data farming has undoubtedly accelerated exponentially in recent years thanks to the internet, social media and the gestation of the “always online” society. But it was going on long before Facebook and Google were on the scene.
“Data brokers” begun building databases in the mid 20th century, to catalog us and our habits for marketing, fraud detection or credit scoring purposes. And in the internet age they have eagerly adapted to be able to ingest and process the far richer and more insight-laden streams of information we make available about ourselves today.
Here is a rundown of some of the companies which probably know as much, or more, about us as Google or Facebook, but generally we know far less about them.
Acxiom started life as demographics, as a side-project by Charles Ward to collect data for use in local politics. Described as “the biggest company you’ve never heard of”, it pioneered the business model of collecting data on people, segmenting them and selling it to other businesses to use in their marketing. Thanks to partnerships with banks and retailers beginning in the early 80s it became a world leader in direct marketing, and marketing data-broking.
Today they claim to hold data on “all but a small percentage” of US households, and their data is said to be used to make 12% of the nation’s direct marketing sales. The company has been criticized in particular for reports that people have found it difficult to prevent Acxiom from using their data, or to remove their data from Acxiom’s systems. It has responded to this in recent years by offering a global “opt-out” and giving consumers some visibility about what information on them is held, through the website aboutthedata.com.
Nielsen has been around since 1923 and has established itself as a leader in market research and ratings. As well as US consumer behavior, which it measures through its National Consumer Program, it is active in gathering data on consumers in over 100 other countries. It also pioneered audience measurement techniques for TV, music, radio and magazine audiences which have become industry standard. Last year it announced plans to make its retail database – known as Consumer Packaged Goods (CPG) – publicly available (for a cost) on a large scale, to allow other businesses to build applications based on the data. You can see an interesting graphical history of the company here.
Experian as it is now known started when a US credit reference agency of the same name was acquired in 1996 by UK direct marketing specialists GUS, which had carried out mail order sales using catalogs since 1900. The group combined credit scoring with the database and marketing expertise it had built over the years to begin offering its services across multiple industries, initially financial and then expanding into all sectors. It also began selling directly to consumers – by offering insights into their own credit worthiness based on data gathered by Experian and bought in from third parties. This was a shrewd (some might say cynical!) move as it capitalized on growing public awareness of corporate data-gathering which had begun to make news headlines around the time. The company landed itself in hot water with the US federal trade commission over the way this service was marketed – through offering a free trial which automatically (and with insufficient warning, it was alleged) rolled over into a paid subscription.
Equifax is the oldest company covered here, established in Georgia, US in 1899. Credit references were its core business from the beginning, as well as providing data to insurance companies to assess risk and set premiums. In the 1970s, the company was criticized based on a perception that it was selling data on personal behavior such as sexual orientation, playing along with a theory that suchcharacteristics could predict the likelihood of people repaying their loans. Today Equifax is said to hold information on 800 million individuals around the world, with revenues of $3.1 billion last year.
Corelogic primarily provides services for the mortgage and real estate industries. It is younger than the other businesses covered here, having been formed when First American Corporation acquired ownership of Experian’s real estate data in the 1990s. Today it provides analytics for the mortgage industry based on data it gathers from open sources, its own customer base, and bought in from other brokers. A US FTC report in 2014 found that it held data on 795 million historical property transactions, and 93 million mortgage applications. The same report names it as one of the top data broking specialists (including Acxiom, also covered here) leading the market in an industry which largely operated with little public awareness of its general practices.