What are the different types of data brokers?
Data is one of the most powerful currencies of the modern age. Business leaders focus now more than ever before on acquiring, storing and selling/trading data because details about consumers makes it possible for them to:
– Understand members of their target markets better
– Provide higher quality products and services
– Offer greater overall value
– Strengthen feelings of loyalty and business ties
– Generate quality leads that improve sales
– Improve trust and brand reputation
– Perform background and credit checks
Of course, data is not only valuable to businesses. Governments, academic institutions, researchers, non-profit organizations and individuals also use and trade individual-specific and group aggregate for a variety of reasons. For example, researchers use aggregate data to help them come to conclusions about their hypotheses or to back up their theories.
Who Trades in Data?
Data brokers deal in data. Beyond negotiating information exchanges with other brokers, they mine data from free and paid sources like government archives, public records, media outlets, business and organizational websites and social media posts. They also utilize direct tools to gather data, such as targeted surveys, rewards programs, feedback requests and behind-the-scenes Web cookies that track consumer activities like keyword searches, ad clicks and buying habits.
Brokers primarily work with data across three main categories:
– Risk Reduction
Risk mitigation brokers exchange data that is critical to confirming a person’s identity and truthfulness. Some brokers offer online portals or software that provide this data, break it down in an organized fashion and update it regularly. This data helps catch people in the act of lying about themselves and committing ID theft and fraud.
– People Search
Anyone who has ever used a reverse phone number search website to find out the name and address attached to a number has used a people search product. Data brokers in this category exchange personal data that is critical to finding one or more methods for contacting or locating a person. This data is also used to learn more about a person’s background and create a clearer picture of their private and public life, including their education, work, social and criminal history.
– Marketing Strategy
Brokers in this category offer demographic and personal data, including data related to habits, values and motivations, to businesses to use to customize marketing plans designed to target specific people and groups. The data also helps with predicting future individual and group behaviors and actions. Products influenced by this data include direct mailers and personalized ads.
People who do not use data brokers often waste time and money trying to locate information. The greatest benefit of working with these brokers is that they do all of the hard work.