• by Laurie Sullivan , Staff Writer @lauriesullivan, January 2, 2025

Trust in developing responsible AI products and educating consumers about the process in which they use consumer data will become major focus this year for a variety of companies linked to advertising and ecommerce.

Nearly every brand, product and advertisers is linked to a financial services company, even if that financial-services company processes payments for advertisers in the form of media buys. 

Jacqueline Karlin, senior director of AI Product & Personalization at PayPal, discussed this in The Brave Technologist podcast, outlining AI product management and how the technology continues to change the financial industry — particularly in payment transactions, privacy and operational efficiency.

Since online transactions are a huge part of ecommerce, it’s obvious that without that payment system no one buys products from brands and retailers. The trust factor is key.

Over the years, Karlin has learned by working at companies like Amazon that it’s all about the utility that companies offer consumers: like PayPal, but also Google Search and Gemini, Microsoft Bing and Copilot, OpenAI ChatGPT, and many others including ways for brands to buy media. 

“Think of personal data as the new currency in the sense that ‘I’m giving this to you, and I’m getting a utility back'," she says. “If you don’t give that utility back you will lose the right to play.”

Karlin defined four types of consumers in 2025, including those who are all in, willing to give the company all their data to use its new products and conveniences and those who are all in if they trust the company. The third will only use the products if they understand the value, which brands will need to clearly convey or forfeit the purchase. The fourth — minimizers — want to use as many utilities as possible, but control and reduce the amount of data they give in exchange.

“It’s not about products anymore,” she said, and went on to explain that the focus is really about consumers trusting the brand, and that cost and benefit in the product or experience must be explained.

Each of the types of consumers outlined add up to about 20% of the market, so those brands that do not have an effective solution can lose 20% of the market.

Karlin believes brands really need to become more transparent in the way they use consumer data. When brands are clear, consumers do not care as much. These are companies that step up regardless of government regulations. Early adopters are a little less concerned.

Karlin recalled her economics class during her time at business school. Her professor would say that as students explore the world they need to determine whether they want to be inhabitants or citizens. Inhabitants are people who walk about and take everything they can. If they see an apple on a tree they pick and eat it, throwing away the core with the seed. Citizens, on the other hand, will get the apple and eat it, but then will plant the seeds for future generations.

As a side note, CNET reports that freelancers may receive a new tax form (1099-K) this year for anyone using PayPal, Venmo and Cash App, geared toward those earning self-employment income that exceeds a certain amount through these apps each year. For last year, those who earned $5,000 or more on a third-party app can expect to receive this tax form. This is a tax-reporting change that changes the reporting requirement to payment apps so the IRS can keep better informed about the income earnings that might otherwise go unreported.