Acxiom Inc.: Consumer Privacy Challenges in E-Business
What detail of you private life would you least like to troubling privacy issues, argue privacy advocates like
see splashed across the Internet? Or added to a database, Deirdre Mulligan of The Center for Democracy and
linked to your name and sold in a mailing list? Technology.
The privacy problem is simple. Companies need to Acxiom can help e-commerce clients "fraud score"
glean information that will help target sales. Consumers web surfers. Using a combination of demographics,
want the convenience of secure h-commerce without criminal background checks, and other factors, the
worrying about having their identities stolen, being company's clients can quickly prevent certain customers
spammed, or having the aggregators of personal data from purchasing items electronically. "It raises a whole
knowing-and profiting from every detail of their lives. bunch of troubling questions," Ms. Mulligan says.
As retailers and consumers force this issue, h-commerce Today, Acxiom bills itself as the largest data-mining
could get squeezed in the process particularly among company in the country. And it's hard to argue against
companies that minimize the privacy concerns of their that boast considering Acxiom has sales topping $1
customers. Take Acxiom. billion annually and 5,600 employees worldwide. The
You may not know Acxiom. But the Conway, company hopes its AbiliTec product will enable it to
Arkansas, company probably knows you, having spent grow by 30 percent in 2001.
30 years amassing a monster database of consumer Some high-tech companies say increased privacy de-
information. It has dossiers on 160 million Americans-90 mands place an undue burden on their businesses. But
percent of U.S. households. critics like consumer rights groups and even some
Acxiom has 20 million unlisted telephone numbers- business advocates counter that the savvy ones will
gleaned mostly from those warranty cards you filled out channel that resistance into a proactive approach. In
when you bought that new coffee maker-that it sells to other words, a privacy-friendly stance could win over
law enforcement agencies, lawyers, private investigators, more potential customers than the hard line would.
debt collectors, and just about anybody else willing to By making their practices compliant with whatever
pay its fee. Acxiom is often better at tracking down privacy standards are set and taking advantage of some
deadbeat dads than the police. That's because Acxiom innovative new tracking and encryption technologies,
combines the most extensive public records database companies eventually could be able to offer consumers
ever gathered by a nongovernmental entity with the protection they want without subtracting from their
consumer information it purchases from the private sales numbers. That could mean collecting the same data
sector. the companies always have, but not sharing it with others
The company's biggest clients are data-hungry without first seeking permission, or assuring customers
telemarketers, retailers, h-commerce companies, and that sites that inevitably will track their web movements
direct mail marketers. Acxiom advises Wal-Mart on how are held accountable for their practices.
to stock its shelves, while helping Citicorp decide the
creditworthiness of potential customers.
Case Study Questions
"We are not a credit agency," sniffed Jerry Jones,
Acxmm's legal and business-development leader, over an 1. What are the problems companies face when dealing
elaborate dinner recently at San Francisco's Ritz-Canton. with consumer privacy issues in h-business and
Mr. Jones and several of his colleagues were in the midst E-commerce?
of a nationwide tour hawking their latest product-a data
integration software system dubbed AbiliTec, which 2. Are there any ethical issues in how Axciom uses its
enables clients like Mercedes-Benz of America to access information on most American households? Why or why
real-time detailed transaction information on shoppers, not?
whether they are on the phone, at a dealership, or online.
With something as simple as caller JD, a Mercedes-Benz 3. What can companies do to proactively meet consumer
operator can make a snap decision on whether or not a privacy concerns, while capitalizing on the business
caller is a potential customer or a waste of time. value of their information?
Mr. Jones says Acxiom is in the business of
streamlining business. Maybe so, but Acxiom's power in 4. What do you think about collecting customer information
advising clients on which customers to embrace and by using online methods like questionnaires and cookies?
which to reject raises
5. Do you think that privacy is important for an enterprise to
conduct its businesses, such as the privacy issues about its