Privacy Versus Targeting: Drawing Battle Lines

While I work in the field of advertising, I am also a consumer. This dichotomy of perspectives means that, while on one side I can see the advantages and the value of targeted marketing. On the other hand, I want to have some say in how the information being collected based my online behaviors is being used.

Most people want to have some control of their privacy. The challenge here is how “privacy” is defined. If you look across a wide range of consumers, most people can be sorted into one of three groups: privacy militants, privacy controllers, and privacy compromisers.

Privacy militants are serious about keeping a low profile. To preserve their privacy, they often avoid subscribing to newspapers or magazines or signing up for supermarket rewards cards. On the other end of the spectrum, privacy compromisers will trade personal information for an opportunity to participate in an online sweepstakes. Most of use fall somewhere in the middle and tend control our privacy by sharing it carefully only when we can determine personal benefit.

As a result, trying to define “privacy” is like trying to define “wealthy.” It’s based on a person’s perspective and not some universal truth. However, protecting consumers from potentially damaging invasions of their privacy can’t be based upon some sort of “I’ll know it when I see it” guidelines. Instead, the advertising industry must understand the privacy concerns of consumers and balance that against the potential to provide consumers with better-targeted and more relevant advertising.

Keep in mind, most consumers aren’t clamoring for more relevant advertising. If truth be told, most would like to see a lot less advertising. But as advertisers, we understand the value and appeal of getting the right message to the right person.

In recent months, the issue of privacy has become synonymous with behavioral targeting. Opponents of behavioral marketing often claim that targeting technologies do not observe privacy policies and contend they use data that are often not fully anonymous. While some concerns may be a little overblown, I would agree that the opportunity for privacy abuse exists within some technologies in use.

Lawmakers are pushing to require behavioral marketers to first inform online consumers that data are being collected that could be used to target advertisers. The key legislator for the proposal, U.S. Rep. Rick Boucher, D-Va, is pressing for new rules that would make opt-in a requirement before an advertiser would be allowed to set a first-party cookie or serve a targeted ad. Apart from the challenges of acquiring accurate data to target with, a measure of this sort could seriously hinder the overall effectiveness of behavioral marketing by, in effect, driving the observers from their observation posts.

To head off this type of legislation, the Interactive Advertising Bureau, in partnership with other industry leaders such as the American Association of Advertising Agencies, the Association of National Advertisers, and the Direct Marketing Association have recently come up with a list of self-policing tenets for the industry. The goal of this partnership has been to come up with guidelines and best-practices for digital advertisers and to promote what they call the “seven principles.”

The principles call for initiatives to educate individuals and business about behavioral targeting, to bring more transparency to industry practices, help consumers better understand how data is being used, and give consumers greater control on how behavioral information is being used.

While the new policies aren�t slated to go into place before next year, it is hoped that these measures will stave off more stringent federal restrictions. What’s more, these new policies could help to create a consistent and accountable framework to protect consumers from privacy violations. The measures would also help the growth of behavioral targeting as an effective way to reach the right consumers with meaningful content.

To stifle behavioral targeting’s growth would be a huge setback for advertisers that want to run more efficient advertising programs in the future.