Corporate Surveillance and Strategy: How Companies Use Data to Understand Consumers

Consumers have grown accustomed to having various choices for both products and brands hence it has become more difficult for companies to stand out among their rivals. Since only the product offering is not adequate to acquire and retain consumers, companies try to differentiate over the relationship they establish. Understanding the customers, their needs, motivations, preferences, and behaviors are key to building this relationship. Once the companies know who their customers are, they create segments by dividing them into groups which enable them to target the right customers, with the right offering, from the right platform, at the right time. Due to the growing use of digital tools, the amount of generated data has also been increasing. Accordingly, corporations that extract meaningful insights from consumer data and leverage these insights as a strategic element in their business strategies are able to gain long-term competitive advantage. However, this practice can also be seen as surveillance and has social implications such as privacy concerns. Therefore, this research aims to examine how consumer-facing companies in the Netherlands across different sectors gather and use consumer data for commercial purposes. In this research, a qualitative critical analysis of consumer data usage by companies as a surveillance practice was carried out from a marketing perspective. In the course of this, ten in-depth interviews with businesspeople were conducted with an average duration of around 45 minutes per interview. These interviews were analyzed and interpreted according to the constructivist approach of grounded theory. The findings derived from the interviews outlined four key themes that further helped to answer the research question and sub-questions. The first theme demonstrated that building close relationships with customers plays a critical role in triggering engagement and retaining customers. Second key point is that considering a datadriven culture has been increasingly integrated into society and businesses, the ways companies connect with their customers have been affected by the use of data as well. The third theme showed that data enables companies to build detailed customer profiles and develop predictive models based on which they implement targeting strategies to change the behaviors of their audience and create market differentiation. However, in a sense, sharing their data also means giving away their privacy for consumers. For this reason, the last theme further provided new perspectives on the concept of data privacy and the regulations of data protection.