The trend of marketers utilizing data about people’s buying habits and lifestyle is nothing new. This is done to tailor advertising to individuals, and make them more likely to purchase. Ever wonder why sometimes the ads that pop up on your facebook feed seem just a little bit too close to home? The sites you visit, the things you purchase, the region you live in and much more personal information gets tracked and analyzed, so you can be better advertised to.
DO Take it Personal
Some say marketing could be heading towards a truly personalized future. Certain businesses have begun experimenting with using DNA analysis to perfect marketing efforts on the individual level. They hope to pair consumers with products and marketing they will enjoy more, all while saving time and money. There’s clear interest in DNA analysis for personal use, which could be the beginning of consumers being willing to share the information with marketers.
Use of direct-to-consumer genetic tests has been expanding. These over the counter home tests, such as 23AndMe, provide access to one’s genetic information to make predictions about health and provide insight to ancestry. With more than 250 companies now in this market and sales projected to exceed $1 billion by 2020, this a vastly expanding industry. According to a recent study conducted by KPMG International Global Consumer Insights, 75% of consumers are willing to trade this personal information for greater personalization of products. Those already DNA-tested are more likely to be interested in receiving offers based off their results than those who have not taken a home DNA test, but reported wanting to do so in the future. According to the YouGov Galaxy Predictors 2019 Study, those who have taken a home DNA test are about 20% more likely to want offers such as travel tours based on their ancestral history, the type of chocolate they might like based on their DNA and low shedding pets if they had a fur allergy.
So Who’s Doing it?
One business jumping on the bandwagon is a Tokyo sushi restaurant to open in 2020. Those who make reservations at Sushi Singularity will receive a DNA sample kit in the mail. These results will be turned into a Health ID, used to create a meal specific to the individual’s tastes and health concerns. Sushi will be 3D printed (yes, you read that right) to result in unique meals that vary in nutrition, flavors, textures, temperature, shape, colors and other ingredients.
Nestlé is also beginning to dabble in using genetic data. The company holds a nutritional supplement business, which has been testing the Nestlé Wellness Ambassador program in Japan. This uses DNA and blood tests paired with an artificial intelligence-driven app, through which users receive recommendations for food supplements and lifestyle changes, and to be alerted to potential health threats. The head of Nestle’s business operations in Japan, Kozo Takaoka, says, “Health problems associated with food and nutrition have become a big issue… Nestlé must address that on a global basis and make it our mission for the 21st century.”
What Could Go Wrong?
While this may seem like the way of the future, it could be argued that the world isn’t ready. A Seattle start-up called Arivale arose in 2014. It offered wellness packages based on genetic testing combined with lifestyle coaching, which included diet and exercise recommendations. Prices for the service ranged from $99 to $199. In April of 2019, the company was forced to shut down after failing to find a sustainable business model. In a statement to the public, the company stated the shut down was “attributable to the simple fact that the cost of providing the service exceeds what our customers can pay for it.” The cost of the tests necessary for its health coaching services were too high for a direct-to-consumer approach.
Aside from the risks from a corporate viewpoint, many risks to the consumer lie in DNA marketing. According to the aforementioned KPMG report, more than half of people surveyed have serious and valid concerns on the topic. 53% were worried about DNA falling into the wrong hands. 40% about being exploited by health insurance companies for higher premiums and 38% of being turned into a target for identity theft. On an almost laughable note, one in four millennials and Gen Xers worry they could be cloned without their knowledge. According to executive director of Red Agency, Jackie Crossman, the main implication is complying with privacy legislation. “Marketers will need an individual’s consent before communicating… Before offering up their DNA for testing, people really need to scour the terms and conditions so they know what they’re signing up for.” Crossman says.
Responsible use of DNA data could lead to a true benefit to the world of marketing. However, it will be important to proceed carefully given the sensitivity of the information. If not gone about the right way, definite risks could arise. People want to be in control of their data, so the unconsented distribution of personal genetic information brings up a huge privacy issue. Marketers using biological data will be held to the same or possibly more strict standards than other data marketers and could even be considered a “special class” of marketing analysis. Who knows, maybe DDL Advertising will add DNA Marketing to our list of services in a few years.
Sources: U.S National Library of Medicine, Marketing Dive, CMO, KPMG International Global Customer Insights, Bloomberg