The secret sauce of human success is collaboration. We have always been a social species, and that has been at the heart of our success. Through history, we have specialised, directing talent to where it would do the most good. And we shared information. The ancients of the Silk Road and the Library of Alexandria shared knowledge.
Renaissance and Victorian thinkers exchanged letters on the topics of the day. Modern scientists have collaborated on everything from climate change to COVID-19 vaccines.
In the United Arab Emirates commercial space, businesses have much to gain from data collaboration. Still, many of these enterprises have understandable reservations about letting third parties access the most precious assets. Even when the will is there, organisations that share data may breach federal decrees on privacy or international regulations such as the European Union’s GDPR.
But we mustn’t consider these challenges as unscalable barriers. Modern endeavours such as the Open-Source Movement—which made much of our current global technology ecosystem possible—demonstrate the prospective benefits of sharing what we know with others.
We even see cooperation in legacy industries. Airlines share data to optimise routes, and banks join forces with fintech startups to bring new value to consumers. There is a catalogue of success stories that do not involve lone innovators but rather partners strategising together to achieve something beneficial to both of them.
Tug of war
In the UAE, as elsewhere, data collaboration is a challenging prospect. One pandemic-era study on the surge in trust between the nation’s consumers and its online commercial entities showed that 53 per cent of private individuals were willing to share their data. But recent findings in Cisco’s App Attention Index series included that 74 per cent of UAE consumers expect exceptional digital experiences as standard, and similar numbers, in the 65 per cent to 80 per cent range, said they would treat anything less as “disrespectful” and would likely delete the associated app.
This gap between the willingness to share data and the expectation of quality (which relies on shared data) presents the greatest challenge. Consumers are served by laws passed to protect them, but they still demand individualised services. How do app producers handle this tug-of-war?
The first step I recommend is realising that regulations, far from being a burden to enterprises, are merely a reflection of current consumer tastes. Even if the laws had never been passed, companies would still have to face the “soft” regulation of private citizens who want to keep their private data private. Any brand that failed to act appropriately concerning customer data would be subject to a market backlash.
However, acting appropriately need not rule out the prospect of data sharing. In a region known for fierce competition in B2C markets, many businesses have an understandable fear of what their user-level data will be used for once it leaves their control space. Are they handing over a competitive advantage? A means of enticing customers away from their brand? Are they revealing the inner workings of their business? These concerns raise many flags around security and ethics and signal the need for strategy when sharing data.
Now: an economic interlude
However, despite its challenges, data sharing is worth pursuing because of its potential for tangible economic value. There are reasons that data has become the new gold. PII data has an unlimited shelf-life. While the usefulness of some transactional and behavioural data may diminish over time, it does not do so through use and reuse. It can be replicated at a very low cost. Retail conglomerates like Alshaya and Majid Al Futtaim are sitting on potential goldmines. Likewise, airlines like Etihad and Emirates ride-sharing apps like Careem or property-finding services like Bayut.
To emphasise the economic point, let’s compare the minimal data costs with those of high-overhead businesses like traditional retailers. Now, we can consider data collaboration not as a potential boardroom leak but as a high-margin service stream that could positively affect the bottom line.
None of this is to say that data collaboration should be undertaken lightly. A privacy-first data collaboration platform must be the foundation of any strategy, as it will allow for management and analysis, as well as the responsible sharing of data. These platforms also include governance frameworks and the means for users to manage their consent. Further—and critical in a region known for its attentive regulators—these platforms provide auditing capabilities.
Let’s join hands
In the data collaboration world, strategic partnerships will take you far. Some organisations value privacy and innovation and have built entire business models around solving the tug-of-war between the two concepts. They can help app providers amplify the benefits of shared data and point the way to monetisation.
Trust is hard won, and consumer markets are a savage testing ground for companies that want to provide peerless experiences while still respecting users’ privacy preferences. Data collaboration is the answer to the dilemma, and while it contributes its bumps to the road, it is an approach that has enormous potential for competitiveness and profitability. Enterprises that take this route will come to rely on their privacy-first data collaboration platforms to help them balance the pull of two consumer-demand forces — privacy and experience. Yes, market insights can be considered the secret sauce, but they offer a competitive edge when collaborating with the right partners.
The Etihad and Alshayas of the world have a role in convincing others that such information ecosystems can work. Data collaboration worked for the ancients, and it can work for us. In competitive industries where businesses are perched on a knife edge, collaboration has the potential to remove uncertainty and allow innovation and privacy to coexist.
