behavioral advertising

More Behavorial Advertising Adventures

by Nick Brown on February 24, 2009 · 1 comment

in Regulation, Tech & Telecom

Back in January I wrote about several advertising industry trade associations coming together to impose self-regulation in an attempt to deter federal regulation of behavioral advertising under the Obama administration. I pointed out that the Federal Trade Commission had advised the advertising industry back in December 2007 that it were pushing the envelope on what the FTC considered to be reasonable behavioral advertising. It seems as though the industry may have viewed this as an idle threat under the Bush administration, but got wind that the new administration would be looking at the issue with renewed vigor.

Last week, the FTC released its Staff Report on the issue entitled FTC STAFF REPORT: Self-Regulatory Principles For Online Behavorial Advertising.  The report succinctly defines the issues at hand and examines the stakes of all sides.  Importantly, the FTC has refined its Principles for Behavioral Advertising self-regulation within the document.

These Principles, a summary of the issues and concerns surrounding behavioral advertising, are divided up into four key points:

1) Transparency and Consumer Control

2) Reasonable Security, and Limited Data Retention, for Consumer Data

3) Affirmative Express Consent for Material Changes to Existing Privacy Promises

4) Affirmative Express Consent to (or Prohibition Against) Using Sensitive Data for Behavioral Advertising

In other words, these are the concerns that need to be addressed in self-regulation.  The FTC concludes its report by saying that the Commission staff will monitor efforts of the industry to self-regulate over the next year keeping an open dialogue with all parties involved.

PEOTUS Behavioral Targeted Advertising Adventure

by Nick Brown on January 16, 2009 · 7 comments

in Privacy, Regulation, Tech & Telecom

The prevention of regulation and the Rule of Law pounding its mighty fist within a medium or sector of business is generally something that is lauded around these parts.  On occasion, though, an industry will find that it is possibly pushing the envelope ever so much over the line and chooses to act on its own behalf.  This self-supervision, for the most part, tends to deter government involvement and the creation of legal regulation, which can in many cases be far more costly than self-imposed rules.

In December of 2007 the FTC notified the online advertising industry that Behavioral Targeting-style advertising was pushing the boundaries of privacy.  Their letter–entitled “Behavioral Advertising: Moving the Discussion Forward to Possible Self-Regulatory Principles”–should have made it abundantly clear that this was a warning shot and the hammer was about to drop.  The industry, quick to respond, and taking congressional action very seriously, announced yesterday (some thirteen months later) that they would seek self-regulation.

The announcement of the proposal to self-regulate came from a partnership between four advertising industry trade associations, including, American Association of Advertising Agencies (AAAA), the Association of National Advertisers (ANA), the Direct Marketing Association (DMA), and the Interactive Advertising Bureau (IAB).  They plan to work with the Council of Better Business Bureaus to develop their guidelines.

Behavioral advertising is not a new idea.  Advertisers have been seeking better ways to target market specific consumers since the first caveman opened a tool shop.  There is nothing wrong with this.  If I make widgets for men that work in coal mines in West Virginia, I’m going to set up billboards for my product outside the tunnel to the mine.  This is just good business sense.  But the modern computer age’s concern with targeted marketing is that it has become extremely personal, so personal that some are concerned with the privacy factor and how much personal data they may be giving up as they surf the web.

While surfing your favorite website, the site will send your browser (Firefox, Internet Explorer, Chrome, etc.) what is referred to as a “cookie”. It is essentially a small text file, quite harmless in nature, and is generally used to track things like web site shopping cart contents or personal settings on that website. It can, however, be used by advertisers enlisted on that site to determine what types of things you are interested in so that targeted marketing of ads can be implemented.

In these cases a cookie is sent to your machine from an advertiser on the site.  This creates a sort of road map for the advertiser of what you like based on the content of the website you were viewing.  Then upon viewing a different website, the advertiser can take the information it recorded about you from the cookie, and display adverts based on things you previously viewed that the advertiser assumes you would want to see.  What results is a totally personalized advertisement experience for you while you surf the web.

So where’s the rub?  While the identity of a user cannot be revealed by a cookie, a user that has registered with a website can be linked to a cookie.  What results is a privacy dilemma because instead of an anonymous individuals surfing habits being recorded, very specific information about who this person is could then be revealed. Additionally, the advertiser could also then tie a specific person to what they are looking at online.

“When you start to get into the details, it’s scarier than you might suspect,” Marc Rotenberg, executive director of the Electronic Privacy Information Center, a privacy rights group told The New York Times’ Louise Story. “We’re recording preferences, hopes, worries and fears.”

Most Internet companies would provide the rebuttal that a user’s account information was seen as just an ID number.  But the concern is that an ID number is attached to an account, an account contains the user’s personal info, and at some point the data could be accessed.  The privacy concern may be far fetched, or it could be completely legitimate.  It would all come down to the ethicality of the company.

So why the sudden movement toward action by the advertising trade associations after 13 months of ignoring the issue? Because PEOTUS Obama is days away from becoming POTUS. And rumors are that lobbyist fear behavioral targeted marketing will be the main privacy issue examined by Congress this year.

“There are no immune companies or business models from Capitol Hill or state regulation,” said Mike Zaneis, VP-public policy at the IAB.

Obviously the move is to get out in front of the issue. A self-regulating industry could deter Congress from considering legislation to legally enforce guidelines. But a self-regulated industry is also watch dogged by its own people. Only time will tell if they have the will power and character to maintain that approach, but it is certainly hoped for as less government legislation is the favorable outcome.

Federally Sanctioned Propaganda Machine

by Gary Howard on December 11, 2008 · 1 comment

in Bailout Watch, Economy, Intellectual Property, Nanny State, Odds & Ends, Privacy, Regulation, Tech & Telecom

 

Apple's 1984 "Big Brother" commercial.

Apple's 1984 "Big Brother" ad

An article over at Ad Age brings up an angle on the whole auto industry bailout probably not considered much before.  The fact that a yet-to-be-appointed “car czar” will have control over a multibillion dollar advertising budget for the big three.  Under the guise of “oversight,” this would effectively “Create World’s Most Powerful Marketing Exec[utive].”  

The draft rescue plan for Detroit sent to the White House by Congress yesterday calls for the appointment of a “car czar” who will oversee the Big Three automakers’ expenses over $25 million — which, by extension, would include media buys. Based on Advertising Age’s estimates of spending by General Motors Corp., Chrysler and Ford Motor Co., that would give the as-yet-unnamed car czar control over some $7.3 billion in marketing spending in the U.S. alone.

The most disturbing thoughts about this (particularly to those concerned with liberty) are provoked here: 

The car czar would wield a budget more than double those of AT&T, Verizon, Unilever and Johnson & Johnson, which round out the nation’s top five marketing spenders, and give the car czar more clout with media and agencies than such famed names in marketing as Walmart Chief Marketing Officer Stephen Quinn and Anheuser-Busch VP-Marketing Dave Peacock.

…If the bailout goes through, agencies that work for the Big Three will essentially be toiling on a government account, with all the associated red tape and strictures that involves.

So there you have it.  We should all be concerned about this for many reasons.  As mentioned, the large ad budget that comes with a czar-controlled U.S. auto industry will allow a government bureaucrat to wield unbalanced and unchecked influence over not only who gets ad contracts, but what media outlets get ad money. The czar can simply refuse to give business to an advertising agency who works for a foreign competitor of the big three (or a “non-compliant” corporation), or refuse to pay money to show ads on outlets that they deem “unfriendly” to the administration or its mission.   This will be an unequivocal disaster.  We have already seen the lengths to which administrations (and pre-administrations) have gone to influence and/or silence media they do not like.  What kind of power plays do you think are possible when the administration’s appointee controls a major source of media outlets’ ad revenue? Whatever it ends up being, it won’t be pretty.