Buyers should have transparency on privacy and data protection, according to panelists speaking at an MIT conference on technology.
There's no two ways about it: Digitization is happening fast and companies that didn't already have an online presence reaped significant benefits moving processes online during the COVID-19 pandemic. But it's a double-edged sword; as they collect data, organizations need to think about the ethics of how they use it, according to panelists speaking at the MIT Sloan Virtual Tech Conference Friday.
"We've always seen the future as digital," said Miqdad Jaffer, senior product lead at e-commerce site Shopify. "Our mission is to make commerce better for everyone."
Emilio Lapiello, a partner at BCG GAMMA, a consultancy specializing in data science and AI for marketing and operations, noted that his company didn't exist six years ago and now has 1,000 employees.
Cathy Hackl, CEO and futurist at Futures Intelligence Group, an emerging tech consulting firm, said she has been waiting for the year of augmented reality. The pandemic has driven rapid adoption of the technology, Hackl said, and people have accomplished what they thought would take three years in one.
Panelists were asked by moderator Jacquelyn Pless, an assistant entrepreneurship professor at the MIT Sloan School of Management, to provide examples of insights they have gained from analytics.
The mandate at Shopify during the height of the pandemic was to save as many merchants and small businesses as possible, Jaffer said. One change prompted by the company's task force was to switch its trial period from 14 days to 90 days "because many people had no choice but to sell online." Shopify also expanded its capital loan program. "We saw buying behaviors change," he said.
How to handle privacy and ethics around data gathering
Social media platforms track data and monetize it now, which is very valuable to businesses, Lapiello said.
With that in mind, Pless asked if the companies have developed privacy and ethics standards around data gathering, noting that there has been consumer pushback on personalization. There have also been "lots of new uncertainties," especially with COVID tracing and the fact that not everyone wants to be tracked. She asked the panelists how they are handling those uncertainties and if regulation is the answer.
Hackl, who is based outside Washington, D.C., has been trying to meet with the "reality caucus" on Capitol Hill to explain what AR and virtual reality are, saying that the U.S. leads in using these technologies.
"I think it's important for lawmakers to understand these technologies and what data is being collected to get ahead of some of these issues coming down the line," she said.
"Personalization always has this undertone of 'Is this better or worse?'" Jaffer said. "The way we think about privacy and data protection is giving transparency to buyers on what merchants are collecting and giving merchants what [data] we have."
If users on Shopify's platform want access to the data the company collects on them, "it's a simple request," he said. But he added that merchants and entrepreneurs are independent and if they want to implement personalization they should use tools to do that.
Lapiello said that AI models introduce certain biases because data is parsed by what someone is looking to target, and this is something buyers should be made aware of.
"What is going to be key with privacy is giving consumers real opportunities to decide how their data is going to be used and whether they want a personalized experience," he said. "Transparency will have to be addressed soon."
Predictions are only as good as your data, Pless added.
Analytics is typically done for a purpose because there is a cost involved in gaining insights about user performance, Jaffer said. "So start with what you're trying to measure and the clear outcomes you want … and that usually yields the best results."
He also suggested using recent data as opposed to historic data when doing any type of machine learning or modeling. "The past can give insights into what is possible there … but it's not as relevant to training because user behavior shifts so quickly it becomes almost outdated as soon as you capture it," Jaffer explained.
Tech in 2030
The panelists were asked to make predictions about the future of digital in their industry in 2030 and what will be made possible by tech by then.
Already, the trend Shopify is seeing is a consumer shift to buying online "and interacting with stores in very different ways," Jaffer said. "Buying behavior in stores seems so far from reality."
Consumers have become less cost-conscious and more focused on sustainability, he said. Those are "top of mind issues. [Consumers] will pick slower shipping if they see it's good for the environment. They want to support their local communities so they're shopping more locally."
Buyers are also looking for unique products and "no longer the same old, same old." Merchants have started creating 3D models of their products, Jaffer said.
Digital transformation will help with environmental sustainability and climate change, Lapiello said. Organizations will have to fully embrace privacy, cybersecurity and artificial intelligence, he said.
"By 2030, quantum computing will be available in some shape or form and will be an incredibly disruptive technology," Lapiello said. "I truly believe the current machine learning generating predictions based on correlations will become obsolete and will be replaced by causal AI, which is quite ripe and will allow for better decisions."
One of the biggest changes will be that people will have moved away from using mobile phones to glasses, Hackl said. "It's not a question of will it happen, but when ... We're 3D beings in a 3D world and the content you'll consume through these glasses will have dimensions" that change what we see in our surroundings.
Just as we use emojis to express ourselves, Hackl said "avatars will become emotional surrogates of ourselves." She also said that already, her kids are buying digital currency and purchasing skins in video games.
Hackl said she closely tracks space marketing. Already, Pizza Hut sent a pizza, and Estee Lauder has sent bottles of face serum to the International Space Station for promotional purposes. Pretty soon, she said, we'll be looking more to space to sell to people on Earth.
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