Insights of Ethics

Why are my professors so good at making me approach ethical issues that make me uncomfortable? And why do they make me uncomfortable?

They make me uncomfortable because my divided brain—the business, “hard-earned money” thinking side, and the “I am a human being with morals” side often clash. From one point of view, I see that companies have the right to search for information that will improve the experience or services they offer, especially when they may lose competitive advantages if they don’t use data collection techniques. But from a second point of view, I understand the need of individual consumers to feel they are being treated justly and that no one is taking advantage of their wants and needs.

So these opposing points of view cause me to draw the following conclusion: businesses should be entitled to collect personal data with the goal of improving the shopping experience, but if it is identifying information then there should be consensus from or notification of the consumer.

To elaborate, here are my three main points.
1) Many people aren’t aware of the permissions they are giving companies when they create an account or give out some personal information.
2) Consumers will most likely act in favor of companies they think are acting ethically and people don’t like to be taken advantage of (i.e. deceptive marketing).
3) Whether a company’s data collection techniques are ethical or not can be evaluated on a case-by-case basis.

1) The articles we were asked to read brought to my attention the fact that when we give out a single piece of information—such as our email—we are often giving consent for companies to add us to an elaborate system of data mining. For example, when we walk into the store to shop for a new tie, the typical consumer isn’t even imagining the possibility of a mannequin collecting data on them using facial recognition technologies or the store tracking our movement using our personal phones as sensors (known as mobile location analytics or MLA). And when my technology-illiterate dad agrees to Facebook’s terms of service, he has no idea that by clicking “agree” he may be also agreeing to allow the company to tie his email to other services he has signed up for—and allow Facebook to efficiently target him with advertisements, or that in the future they may track his cursor moving across the screen. According to one article—“data that once seemed anonymous can actually identify people if it’s pooled with other data sets”. I think it is important for companies to be up front about their data collection methods and how they will use the data—and especially whether or not they plan on sharing it with any other third parties. Facebook may include some statements about data collection and privacy in their terms of service agreement—but they are not conspicuous (a term we learned in business law to mean they are “noticeable to a reasonable person” or in other words—in a larger font or different color). I don’t believe that burying a line about privacy within a mile long agreement that most people don’t even bother to read can qualify as notifying consumers—especially when many online consumers include older web surfers or children who are unaware of privacy issues.

2) In the long run, it can only be favorable for a company to act with ethics in mind. Many companies incorporate ethics into their mission statements, or have a code of conduct with  For example, Google has a code of ethics which states “Don’t be evil…..it’s also about doing the right thing more generally—following the law, acting honorably and treating each other with respect.” While Google has a very long code of ethics—Facebook doesn’t have a clear cut code of ethics on their website. Are they hiding something? Incorporating ethics statements that companies actually abide by can increase the faith of consumers in those companies—and make them feel better about their relationship with them. For example, after many scandals about Wal-Marts treatment and benefits for employees—many people now feel guilty to say they shop there. Many major MLA (mobile location analytics) firms have enacted a code of conducts that requires all retailers who use their technology to notify consumers when data is being collected. In general, I believe people prefer to shop with and use services of companies they believe act ethically. Most purchases are made by consumers with the expectation to be treated fairly by a retailer and receive fair value in the purchase—and I think it would be beneficial for most companies to respect people’s adversity to information sharing. At the same time—it would also be smart for companies to educate consumers of the positive ways data collection can help consumers. Improving data collection techniques and making them more personal can help companies identify what its customers actually want to buy—not just what they think their customers want to buy (highlighted in the car dealership example). It can also enhance the in-store and online experience—the mannequin article stated that the device “could really enhance the shopping experience, the product assortment, and help brands better understand their customers.” In the same example, a store discovered from the mannequins that shoppers were bringing children with them to the store and they added a children's line of clothing—the store actually increased convenience for the consumer. In these ways, data collection, even an unnerving one such as facial recognition equipped mannequins—can actually help customers. Teaching consumers about these things and sticking to an ethical and public privacy statement may decrease their aversion to data collection.

3) There is a fine line between collecting data with the goal of improving relationships with consumers, and using data collection in a deceptive manner to target consumers. That is why I think a company’s ethical use of data collection can be evaluated on a case-by-case basis, evaluating factors such as what they do with the info, their goal in using the info, and whether it contains personally identifying information. If a company intends to collect demographic and behavioral information with the intention of improving understanding of consumers, it has a different connotation than when they collect it with the intention of selling the information to third parties or trick specific individuals into spending more money. A good example is written in the article titled “the economics of surveillance”. Using technology to track suspected criminals is used to maintain the safety and welfare of the general public but businesses often collect data with the goal of increasing profits. I think when data is collected anonymously (the data won’t allow any company or a third party to identify who it is associated with) it can become a pool of general information that will allow a company to improve its strategy. But when data collection becomes so personal and identifiable that it allows car dealerships to actually “think” they know what a person is looking for when they walk in the door, and target that person specifically, it becomes almost like companies are attacking individuals in a privacy invading manner.

I noticed that most of the articles assigned to us in class on this topic are almost a year old—I shudder a little when I wonder what types of data collecting technology have been developed since then.

Other sources I used:

http://investor.google.com/corporate/code-of-conduct.html
http://blogs.wsj.com/cio/2013/10/30/facebook-considers-vast-increase-in-data-collection/
http://www.natlawreview.com/article/big-brother-watching-you-shop-pants-mobile-analytics-firms-implement-code-conduct-tr