'Big Data' Sounds Scarier Than It Really Is, Says Marketing CEO

"We exist in a society that is consistently worried about 1984."

David Steinberg, CEO of Zeta Interactive.

David A. Steinberg, CEO of Zeta Interactive.

Big data: it’s a term that tends to make people nervous, conjuring images of NSA surveillance and massive privacy hacks.

But those who work in big data will argue otherwise. Earlier this month, we spoke with David A. Steinberg, CEO of Zeta Interactive, a big data marketing platform he founded in 2007 with former Apple CEO John Sculley. Zeta Interactive helps its clients — like T Mobile, US Airways and Time Inc. — harness the copious data they regularly collect from their customers, and send out more effective, targeted advertisements. 

Using big data, Mr. Steinberg contended, helps companies advertise more efficiently, and in turn makes your Internet browsing experience more enjoyable — if you can get past how creepy it is when Facebook ads seem to know exactly how much you love Harry Potter merchandise.

Big data marketing means that ads are targeted directly to your interests. While we still find it a little Big Brother-y, Mr. Steinberg says it’s nothing we should fear.

What if a company came to you and they had data that they collected in an unsavory way — maybe in a way that violated privacy standards?

We wouldn’t work with them.

Do you ever turn down companies that are collecting data in unsavory ways?

No. Most Fortune 1000 companies are doing this right… Of our approximately 700 customers, approximately 500 of them are Fortune 1000 companies. So we’re working with big companies on this… From recollection I can think of one or two we’ve had to say, we think you’re great companies but your policies don’t align with what we’re looking to do.

Does that make you guys the good guys of the big data world, or is that a general policy amongst other big data companies?

Everybody I know and everybody we work with is really focused on what’s happening with consumer privacy. There are some bad apples out there, and there’s some bad actors, and I think some of them give us a bad name… It’s almost all a fear of what could happen versus what has happened… We exist in a society that is sort of consistently worried about 1984.

Do you find yourself constantly having to explain that big data isn’t 1984-ish?

[Mr. Steinberg explains that his customers understand that big data isn’t scary, but that the average individual is still sensitive to it.]

The point I’m trying to make is, I just haven’t seen it where it’s been violated. Did Target get hacked a few months ago? Sure, but they weren’t hacked by a big data company, right? They were hacked by some individuals who decided they could crack through an antiquated sales system and figure that out. And it still remains to be seen what happens with that data, if anything. Obviously it hurts Target’s business, because people are scared of that. I get that; I’m a consumer as well as a CEO, I’ve got my data, I’m always concerned what’s happening with my data and my credit and all those things we worry about. But at the end of the day, the worst thing I’ve ever seen happen with a big data platform is somebody sends an offer that’s inappropriate to that individual. Not bad, not inappropriate, but just not appropriate to that individual.

So the worst part about big data is the potential for a mis-targeted ad?

Yeah, like, a hair transplant ad to a 24-year old with a full head of hair.

[We explain how sometimes we get weird ads for maternity swimwear.]

So overall, you’re saying people shouldn’t be scared of big data.

It helps them. Big data is trying to cure disease. [It’s] is trying to make sure that the offers you get are relevant to you, that you might be interested in. So you’re not getting maternity swimwear, you’re getting outfits from J-Crew that you’re interested in, with a discount that interests you. That’s what big data does. I haven’t seen any cases where big data is being used to the detriment of the user.

But people must freak out when their computers seem to know them better than they know themselves.

[From an industry perspective], If you customize the offers too much, you get to the point of diminishing marginal return on purchase rates.

Why is that?

Because you scare people. [Mr. Steinberg notes, however, that he hasn’t yet seen companies lose money for scaring people with their ads.]

How do you see big data continuing to grow and become a part of our lives?

I think that everything that touches your life is going to be driven by data… Look how Amazon has taken control of online e-commerce. The vast majority of that is because they use the best big data in the world to help people’s decisions on what they want… [And] Netflix, why do people love Netflix? Because the recommendation engine is the best in the world. When you open up Netflix and don’t have 56,000 movies sitting in front of you — you have ten — that’s big data making your life better. That’s going to continue to evolve.

Do you also see it applying to the physical world, like when you walk into a physical storefront or a physical restaurant? 

There’s nothing that says that you wont one day wear a device that lets [a restaurant] know who you are, what you like, you can get your table in advance, they can know when you leave your house to get your table, they can have it ready for you the second you walk in with the appetizer you want sitting with the drink you want chilled and ready to be consumed.

'Big Data' Sounds Scarier Than It Really Is, Says Marketing CEO