Milton Pedraza, CEO of The Luxury Institute, has partnered with DataLucent to introduce the Institute’s Advanced Personalization Xchange (APX), a disruptive personal data technology that allows premium and luxury brands to market with you. Not at you.
If life under lockdown has taught us anything, it’s that consumers must directly source and control the digital monitoring, analysis, and sharing of their personal information.
The continued adoption of digital technology (alongside the rise of AI, emotional intelligence, high-profile consumer-data breaches, and massive shifts to mobile), exposes a fundamental disconnect between what consumers want and what companies currently provide; and growing concern about privacy and protection among consumers signal an even wider gap between brand perception and long-term returns on investment. Trust is in short supply.
According to Transcend, over 90% of Americans support switching to a company that champions more holistic data privacy practices. Personal data privacy, however, is not simply about what Big Tech knows about you, or how ridiculous policy frameworks of consent work.
Tracking, Profiling, and Affecting People in Real-Time. Image: Cracked Labs.
Every like, app install, or purchase distributes a range of data trade-offs between multi-billion dollar 1st, 2nd, and 3rd party behemoths like Facebook and Google to, say, Oracle or Acxiom. But as McKinsey & Company point out, more democratic data policy frameworks encourage entirely new pathways for brands to create people-first responses that restore dignity to the wider consumer-brand relationship.
What Is the Advanced Personalization Xchange (APX)?
Enter Milton Pedraza, CEO & Founder of The Luxury Institute.
There are fewer, more influential personalities in the world of luxury marketing and research than Pedraza. Immediately recognizable for his reign at multinational conglomerates like Pepsi, Colgate, and Citibank, he is arguably one of the most high-profile advocates of the new personal data economy. And data dignity for human beings. “Our goal,” he says, “is to protect, enhance and promote the best interests of the individual, even as we serve the interests of the brands. These interests are not in conflict when parties want to build direct, mutually beneficial long-term relationships.”
Milton Pedraza, CEO & Founder of Luxury Institute. Image: Luxury Institute.
That’s why he’s joined forces with DataLucent to create the Luxury Institute’s Advanced Personalization Xchange (APX), a proprietary technology platform that allows you as an affluent consumer to license your data legally, ethically, securely, privately, and consensually to premium and luxury brands. “This, he says, “is really an informed, symmetrical exchange of value.”
How Does the Advanced Personalization Xchange Work?
So, at its most basic, APX is a Data as a Service (DaaS) platform that passes through four phases. The first is where premium and luxury brands can promote to you directly as a prospect or client, invite you to opt-in and share your most predictive data insights for fair rewards and benefits.
Upon consent, the individual goes through the downloading process via social media (think: Facebook), into a personal device (your smartphone) and automatically upload the data to the APX server (i.e., the second phase).
Within the APX server, your data is encrypted and anonymized, and placed into an individualized personal data store that you control (i.e., the third phase). Your data is protected from hackers and the brand never takes possession of, nor has access to, your data directly.
In the fourth phase your data is analyzed, within the secure APX server, and brand-relevant, actionable insights are generated so the brand can generate predictive customer segments, personas, content, and offers that are far more likely to be compelling and purchased by prospects and existing customers.
If you ever feel uncomfortable, or that you’re not getting the value you expected, you can opt-out; all your data will be deleted. You choose. If what you want is the right to access, control, and license your personal information, that’s fine too.
Why Should Premium and Luxury Brands Get On Board?
But if you’re a CEO or the head of a brand management team looking for simpler, profitable ways to translate APX’s platform features into richer brand experiences, success will depend on the interplay of these four factors.
First, prospecting. Ask yourself: “What do our customers really look like? What are their true attributes? Understand your customer base so you can affect and influence and inspire them.” Half the battle is having a data source that brings all customer data together in one place. This allows your brand to get a good sense of who your consumers are and to what segments they belong.
“Brands will make offers to consumers. Consumers will ask: Do I trust this brand? Are they offering me enough for my data? If consumers say yes to both questions, imagine the value if hundreds of brands do that.”
Second, Cross-Selling. If 20% of your customers, for example, give you 80% of your sales, understand them well so you can take that bottom 80% and nurture them at a higher level. “Find customers in your own customer base and build deeper relationships through nurturing, and cross-sell in a way that is ethical, legal, and consensual.”
Third, personalization. Think through the micro-segments of your customer base. “Make better predictions about them, and better recommendations, which will inspire them to buy more from you at scale.”This might, for example, take the form of personalized email campaigns tied to incentives or rewards, allowing brands to drill down and develop research that supports their wider strategy to solve the problems customers are facing.
Click here to read LI’s The Rising Tide of Advanced Personalization.
Or fourth, have a Blue Ocean strategy. Go laser! Look for patterns in the data where new products or services could be developed based upon what are you not doing with your customer base. Keep your strategy current by using a combination of media relations, AI, and VR technologies that will help you differentiate relationships from sales.
Note, too, APX does not set the price of data. “Brands will make offers to consumers. Consumers will decide: Do I trust this brand? Otherwise, no. Two, are they offering me enough for my data? Imagine if hundreds of brands do that. How much value can you get? I think it is possible for one individual to gain tens of thousands of dollars a year in benefits, perks, and rewards.”
And while you might think the APX platform is looking to compete with Big Tech, you’d be wrong. In the new data economy, there’s plenty of room for everyone. Equitably, ethically sourced room, that is. The brilliance of the APX platform is that consumers are empowered with a profound sense of their own capacity: an ability to respond to the disruptive character of our time and the unequal nature of our economy. Thus, shifting the balance of power away from, for example, predatory data brokers and toward the consumer.
And in the new data economy, “where consumers have control of their data and symmetry in and equality in the relationship, they are no longer users. They are now real human beings with commercial rights to their data.” Talk about perfect timing.
For more information, check out the Luxury Institute’s podcast episode, Luxury Institute and DalaLucent. The New Era of Primary Customer Data.