Identity Value Propositions

In talking to colleagues about how one can market their data successfully and still remain in complete control of it, I see that there are areas that could use some clarification, or at least some use cases. Here are a couple of example areas designed to show how money can be made in an customer-centric Identity Commons profile economy.


It's a little known fact that when Safeway installed point-of-sale card readers in the 1980s that this move was funded by Nielsen (of TV ratings fame) who collected the purchasing information and sold reports and services back to Safeway based on this information - a brilliant win-win marketing move. Ditto the "Safeway Club Card." Suffice to say, Safeway has collected scads of valuable purchasing information on its customers.

Now let's say that I have a Safeway Club Card with no connected identity - all it carries with it is a unique number that is attached to all the purchases I have made. Let's pretend that I use cash as payment so there is no connection to my credit card information either. Still, Safeway can now offer several new services:

Personalized Special Offers

Since Safeway knows the aggregate buying habits of its customers, it can work with suppliers to create special offers to people who match a particular consumption profile. For example, an offer for a special price on a new soft drink could be made to all people who buy a six-pack or more of soda a week. This offer could be presented on a personalized Safeway Web Page where the customer types in the number on their Club Card and transacted by swiping the card at the check-out stand. No coupons - great deals.

Purchase Authentication

Back in 1999, RJ Reynolds paid a marketing company the equivalent of $20 per head to reach smokers in New York City who smoked more than 2 packs a day. Rather than sending junk mail to all NYC residents, a smart e-broker could be used instead. An ad appears on my personal e-broker home page that says it will pay me $10 if I can prove that I buy two packs a day or more. If I bought two cartons a week from Safeway, I could enter their authorization page, and have it cryptographically sign a note authenticating that fact (which again, can be done without revealing my true identity, or even my Club Card number). Note that Safeway may charge me $1 for this service - a new revenue stream - but that's OK, as I still clear $9. I supply this authentication to the e-broker which sends me the ad. It collects $12 per head from the marketing company (a 40% savings) of which $10 goes to me, and it's a win-win-win-win.

Book Buying Agent

While Amazon can (and does!) deduce a lot from what I have bought and/or browsed on their site, they still do not know what books I buy from e.g. Barnes and Noble or other book stores, what magazines I subscribe to, what movies I watch, and other criteria that could be used to make better, more accurate book suggestions.

Imagine a book buying agent that accumulates the reading habits of its customers. Similar to the Safeway model described above, one can use a pseudonymous ID, and if one desires better security, onion-routed anonymous remailers can be used to protect the customer's identity. When in use, such mechanisms promote good behavior on the part of the agent, as if it misuses the customer's data in any way, she can simply stop receiving email from that particular pseudonymous ID, leaving the agent with data with no connection to a user.

Now the agent, with millions ;-) of customers can present aggregated anonymous data to book sellers and cut deals that are beneficial for all. Another win-win-win situation.


Back in the latter years of the last millennium, I heard that it was worth $1200 to Lexus to have a qualified buyer step onto their showroom floor. Using blinded signature technology, one could present credentials that my net worth is over $100K, that I generally buy a new car every 2-3 years, and that it's been 30 months since my last car purchase. Upon presenting such a credential, the Lexus dealership might pay me $500 cash to take a test drive - everyone wins!

For more on this form of "anonymous digital bearer instruments", see e.g., Lucrative's Perspective. More links with theory, etc. are here.

(These ideas are condensed from the Broadcatch CDML and Lumeria SuperProfile concepts.)

Thought for the day: The value of customer data is immense, and actually increases when in the hands of the customer.


Ha! took me a moment to get

Ha! took me a moment to get that what you were talking about had nothing to
do with pseudonymous identity value propositions.

For those just tuning in, Eugene's talking about my Infamous Monty Hall
Problem page at

Actually, you are wrong - simply Google "monty hall problem" and you will
find folk from the math departments of Rice, South Carolina, Toronto, Chicago and
UCSD (on the first page) who disagree with you.

If you still don't believe, I have a used UFO you may be interested in...