Most web publishers of any significant size use some type of third-party technology solution that makes it easy for consumers to share their content with other Internet users. However, according to Rebecca Watson, VP of Business Development for social advertising platform provider RadiumOne, vendors of these solutions often perform some other sharing they don’t tell publishers about.

Content Sharing, Consumer Data and Transparency 

In an interview with CMSWire, Watson said providers of popular content-sharing solutions such as AddThis and ShareThis are not being “completely transparent” with web publishers when it comes to how they earn a profit. “There is an ecosystem from advertiser to third-party solution provider to publisher that is not benefiting everyone involved,” she stated.

Watson explained that third-party providers of content-sharing solutions typically package and sell data on how customers interact with publisher content and sell it to advertisers. The publishers whose content actually generate this data do not share in any of the revenue and usually are not aware that the data is being sold.

The RadiumOne Approach 

Watson said RadiumOne takes a different approach with its solution that provides web publishers with an embeddable click-to-share button. “We give access to what consumers do after they share content,” she said. “Publishers can place a display ad in an overlay bundle with a message like ‘you have successfully shared our content.’”

According to Watson, this provides web publishers a “brand new” revenue stream with “no capital costs.” And customer data generated by sharing is never sold to third parties. “We’re part of a trend toward transparency in the web publishing marketplace,” concluded Watson.

Social Sharing Drives Purchases 

While questions about what happens to data generated by social sharing may exist, there is no question that it boosts consumer purchase behavior. As reported by CMSWire in March 2012, the Sociable Labs consumer research study “Social Impact Study: How Consumers See It” indicates social sharing has moved into "a mainstream activity."

The report goes on to note that 62 percent of all online shoppers are reading product-related comments from friends on Facebook, with 75 percent of these shoppers clicking through to visit the retailer’s site (no Google search enters the process here). Further, social sharing drives conversions, with 53 percent of shoppers who click through to the retailer’s site buying the product that was shared.

All told, that translates to a whopping 25 percent Share-to-Purchase Funnel of All Shoppers, according to the group. Translation: Get this right, and one in four of online retail customers are coming from the social, not search engine, side of the web. No wonder the behavioral and demographic data generated by social sharing participants is attracting so much interest. 

Congress Examines Social Data Resale

Advertisers, third-party sharing solution providers and web publishers should keep an eye on Congress as the federal government begins looking into exactly how online consumer information is tracked, gathered and resold.

According to the consumer interest site ProPublica, last week responses nine data companies gave to a Congressional query about how they harvest and resell consumer data shows widespread and detailed collection of consumer data which is then analyzed and resold to advertisers. This data includes content social media users share with others.

There is no definitive sign that Congress plans to increase regulation of how social media data is collected and sold or used, but a joint comment from lawmakers should put everyone involved in this type of activity on alert: “The data brokers’ responses offer only a glimpse of the practices of an industry that has operated in the shadows for years. Many questions about how these data brokers operate have been left unanswered.”