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If Tracking Is Outlawed, Only Outlaws Will Have Tracking

  |  January 7, 2011   |  Comments

The profound impact the FTC's privacy and do-not-track initiatives could have on your PPC campaigns.

Accept my apologies for appropriating a pro-gun slogan and turning it into a column title. But despite what you may be thinking, the privacy and do-not-track initiatives being talked about in the press may have a profound impact on your PPC campaigns.

Most people concur that the online ad industry has done a really poor job of educating consumers and providing disclosure that is clear, obvious, and easy to find. Privacy policies are nonsense. Are we really that surprised that the government (legislative and regulatory bodies) is stepping in? How will this all shake out? Current prevailing wisdom is that the implementation for most of the privacy protecting and disclosure enhancing measures will be within the browsers (IE and Firefox in particular).

Specific guidance from both the U.S. Federal Trade Commission and the Department of Commerce is clear. The FTC and the Obama administration via the Department of Commerce's Internet Policy Task Force green paper entitled "Commercial Data Privacy and Innovation in the Internet Economy: A Dynamic Policy Framework" both focus on consumer rights with regard to privacy online.

Both industry and privacy advocates have been taking positions on the matter and using surveys and actual consumer behavior to "prove" that theirs is the true representation of the needs of the U.S. and global consumer. As with nearly every other polarizing issue, the truth lies somewhere between the extremes. Some consumers want to remain completely untracked as the default, and others would rarely opt out of tracking even if that tracking included PII (personally identifiable information), which of course the vast majority of online behavioral tracking does not.

You may be thinking, why does this matter to me? I'm just a search engine marketer doing SEO and PPC search and trying to make money on the Internet.

It matters because if you decide to take the high road and stop using methods such as behavioral search retargeting or are forced to employ the most strict interpretation of disclosure requirements (such as default opt-out), then you won't be able to compete with others who do and can bid more for traffic because they are factoring the low cost, highly effective search retargeting value of a click on top of the immediate conversion value. This means you will be at a double-disadvantage.

Imagine if you will an entire offshore infrastructure designed to anonymously fingerprint and profile users. Like online gambling, some e-commerce and service providers may move offshore where they can operate without onerous privacy restrictions. Legitimate marketers may find themselves at a disadvantage compared to the outlaw competition, in the same way that ethical e-mail marketers must compete with e-mail spammers

It's still early in the conversations surrounding the FTC proposal. The FTC focus within its document was based on roundtables where several themes emerged, primarily:

  • The ubiquitous collection and use of consumer data.
  • Consumers' lack of understanding and ability to make informed choices about the collection and use of their data.
  • The importance of privacy to many consumers.
  • The significant benefits enabled by the increasing flow of information.
  • The blurring of the distinction between personally identifiable information and supposedly anonymous or de-identified information.

These themes led to the FTC recommending several initiatives that are expected to be different for each digital business.

The Department of Commerce states in its green paper that: "The government can coordinate this process, not necessarily by acting as a regulator, but rather as a convener of the many stakeholders—industry, civil society, academia—that share our interest in strengthening commercial data privacy protections."

What perplexes me is that the Internet marketing industry let the privacy and tracking disclosure issue get this far. Banner advertising (the biggest area of privacy concern) has sufficient room for a visible and understandable interactive privacy and tracking area. While the IAB/NAI initiatives and those of some other display advertising providers represent a step in the right direction, it's my opinion that 20 to 25 percent of every banner ad served should include an interactive, clickable notification area advising users as to the nature of any tracking that is in place or will take place as a result of the ad being shown or interacted with, along with instructions on how to change preferences (until such time as browsers become the dashboard controlling such changes).

I'm cautiously optimistic that consumers and legislators will realize that once consumers are empowered with the knowledge about what information an ad network, analytics provider, publisher, or marketer has on them, most will leave well enough alone and prefer targeted ads to untargeted ads. Time will tell.

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ABOUT THE AUTHOR

Kevin Lee

Kevin Lee, Didit cofounder and executive chairman, has been an acknowledged search engine marketing expert since 1995. His years of SEM expertise provide the foundation for Didit's proprietary Maestro search campaign technology. The company's unparalleled results, custom strategies, and client growth have earned it recognition not only among marketers but also as part of the 2007 Inc 500 (No. 137) as well as three-time Deloitte's Fast 500 placement. Kevin's latest book, "Search Engine Advertising" has been widely praised.

Industry leadership includes being a founding board member of SEMPO and its first elected chairman. "The Wall St. Journal," "BusinessWeek," "The New York Times," Bloomberg, CNET, "USA Today," "San Jose Mercury News," and other press quote Kevin regularly. Kevin lectures at leading industry conferences, plus New York, Columbia, Fordham, and Pace universities. Kevin earned his MBA from the Yale School of Management in 1992 and lives in Manhattan with his wife, a New York psychologist and children.

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