How Do Companies Misuse Your Data?

How Do Companies Misuse Your Data?

Many of us worry about data misuse and the protection that we have on the internet. However, we need to know a little more about how companies may use this data in order to be able to understand how it can be misused. On the one hand, companies use their own customer databases for advertising campaigns to existing customers. On the other hand, in order to win new customers, they obtain data from so-called address dealers. These rent or sell databases tailored to specific target groups. To do this, they systematically evaluate publicly available sources. In doing so, they not only collect addresses, but also evaluate information about lifestyle and purchasing behavior. For example, address and telephone books, e-mail directories and lists. As well as trade and association registers, business directories, websites and private advertisements in newspapers. Using data does in fact come as part of many business marketing strategies. It gives companies an idea of how their customers think, how they work and what their behaviors are like.

How Companies Should Use Your Data

Some companies carry out specific household surveys, competitions, raffles or information events in order to obtain addresses and information. These are relevant to advertising. A lot of data can also be collected through customer loyalty programs and discount systems. Many advertisers also use the address lists of other companies and organizations. Similarly, rent or sell companies their customer addresses often also with each other. Mail order companies, for example, can offer numerous customer addresses due to long-term business relationships. Sorted according to advertising-relevant information about buying and payment behavior. Are companies allowed to use or pass on consumer data for advertising purposes? If a company or organization intends to use customer data not only for the agreed purpose (e.g. for contract processing), but also for advertising for completely different products, it must point this out when collecting the data. It must also inform the consumer under among other things information about possible recipients of the data. The consumer must consent to this, unless the provider has a legitimate interest in the processing. This also applies if companies specifically collect data through raffles, competitions, household surveys or information. As well as events in order to then use or sell them for advertising purposes.

Sensitive data is important

There is a lot of data that is related to personal things. Such as information on illnesses, religious affiliation, party affiliation. Such data may only be passed on or used for advertising purposes if the person concerned has expressly given his prior consent to this data. So, what is true on the internet? Digitization is making it increasingly easier for providers to process and analyze data. Consumers often disclose a variety of data about themselves on the Internet. For example, you have to register for the respective online service and you also provide personal data while shopping online.

It is now generally recognized that valuable data can give companies at least as much market power as classic factors. Such as high market shares or important infrastructure. The rules that should prevent the abuse of special market power in the "old economy" are now being extended to the digital world. In the future, a company will have a dominant position even if it has special access to data. Even companies that have not been viewed as dominant in the market up to now, for example because they are smaller or do not yet have a high market share, can then fall under the strict rules. These rules are part of the so-called abuse control. You must then behave particularly fairly towards business partners and competitors. Conversely, many companies now have to ask themselves whether they should act more cautiously in the market in the future. Because they are now more likely to be subject to the special obligations of consideration that apply to dominant companies and companies with relative market power. Including special market power over certain competitors, suppliers or customers. This applies not only to companies in the digital economy, but also to those from the "old economy". These questions should be asked:

  • Do we have data that gives us an edge over the competition? How easily can our competitors get this data?
  • Could we be seen as a company that other companies depend on?
  • How do we deal with our special responsibility and the resulting risk situation?
  • What precautions do we take internally so that we keep within the limits of what is permissible?
  • To what extent do we have to adapt our previous negotiation strategies and conditions?

Some Ways That Your Data Gets Misused Online

There are several different ways that companies can misuse your data. Different people have access to your data within an organization and they dont always follow the rules when it comes to their companys policies or the law.

Using Data Over and Over Again

Sometimes, companies will collect data and intend to use it for a specific marketing purpose, like an email newsletter. Sometimes, people will use this data to target you with online advertisements or you might find yourself suddenly getting emails from that parent companys other business. That is an example of misuse of your personal data.

Someone In a Company Uses Your Information For Their Own Business

Lets say that you signed up for someones newsletter on their online store. If a person in a company uses that data for one of their own marketing projects, that is another example of how your data gets misused.

A Company Doesnt Tell You How They Are Going To Use Your Data

If you purchased a product from an online store and you suddenly see yourself getting plastered with ads from that company on Facebook or Google, you might have had your data misused. Companies should explicitly state how your personal contact information and data will be used in their privacy policy.