Data Pooling: What Is It And Why Does It Work?

Data Pooling: What Is It And Why Does It Work?

A business’s data is a valuable tool in both a commercial and operational sense. When combined with another company’s data, this value soars, explains Steven Millward, General Manager – Product, Sales and Marketing at smrtr in this piece.

As the saying goes, ‘sharing is caring’, and when it comes to data, sharing can serve as a way to generate greater results from existing data.

This is why the idea of data pooling has risen in prominence in recent years. Data pooling is basically what it sounds like – combining together data to improve the overall effectiveness. This is otherwise known as second party data. 

Given the need to develop better customer relationships, companies are now looking beyond their own customer data to create a more well-rounded view.

As well as helping businesses understand their customers, data pooling may also resolve data ‘bottlenecks’ (a point in which the flow of data has stopped), improve algorithms and enhance data access.

The reasons why companies pool data will vary. For example earlier this year, the World Health Organisation launched a data pooling platform to enable governments and businesses from around the world to share information about vaccines and health data to help address the COVID-19 pandemic.

Tourism Australia has taken to combining its own data about international travellers with data from state tourism authorities as part of the Consumer Demand Project.

“We have this incredibly rich pool of information about our target audience and about the broader traveling audience in these markets – longitudinal data that helps us understand the shifts and changes in attitudes and behaviours,” said Tourism Australia CMO Susan Coghill. 

Many data sources are already pooled to prevent and reduce fraud. For example, Austrac pools transaction data from banks to prevent a range of criminal activities, and the insurance industry pools claim data to identify fraud. Like many data initiatives, concepts start at the prevention of crime and then cascade down into other applications.

Data pooling also has medical uses. ROADMAP, which aims to deliver better care for people with Alzheimer’s disease, has been sharing patient data from across Europe to offer guiding principles and recommendations on care.

Back in 2015, meanwhile, UK affiliate network Skimlinks launched a ‘data co-op’ to give businesses the opportunity to combine their respective first party data and build insights based on competitor’s data.

As well as helping participating companies form better data strategies, the data co-op also (in theory) served as a way for smaller businesses to compete with tech giants such as Google, Facebook and Amazon, who each possess an unrivalled network of customer data.

As we now know, since 2015, a lot has changed when it comes to data sharing and relevant regulation, meaning customers must now be careful about how they pool their data.

Under GDPR, if two companies are to pool their data together, both organisations are deemed joint controllers of data, meaning there is double the liability should anything go wrong. In Australia, meanwhile, the Office of the National Data Commissioner is currently working with the Office of the Australian Information Commissioner to develop a data sharing framework.

In June, a German court moved to ban Facebook from pooling user data from across its network (WhatsApp and Instagram) unless the user had been given “qualified” consent. This was seen by the court as not only a privacy issue but also an antitrust issue.  

At smrtr, we know how valuable data pooling can be for organisations and help our partners supercharge their first party data by providing access to our extensive range of data for further enhancement and inclusion in combined analytics. But we also understand the shifting regulatory and ethical framework around such methods, and help our partners use data in a compliant way.

We are also trusted by our clients to securely hold and combine data to enable pooling without unnecessary technology and risk overheads.


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