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Online Privacy Concerns with Data Collection

// November 12, 2010 // Advertising // 2 Comments

There has been a ton of chatter over the past year about online privacy and data collection related to social sites and online advertising. As technology continues to improve advertisers are able to learn more about their audiences based on information gathered from social networks and from their behavior online. This data collection allows us to target consumers on a deeper level, but at what cost to the consumer?

Data collection has been going on for years. I remember back in the early 2000’s when Yahoo pitched their behavioral advertising program and told us that we could target a user based on their interests. What? You mean we can target someone based on their web browsing behavior? This was absolutely amazing because for the first time advertisers could run highly targeted messages to specific audiences.

The problem? You need data to be able to do this, and that means that consumers’ browsing habits are being tracked and categorized.

Currently, the most common way data is collected for Online Behavioral Advertising (OBA) is done by placing a ‘cookie’ on the users computer. This cookie is a small piece of invisible text that gets stored on your computer and then gathers information about what you do online. These cookies are not only extremely helpful to advertisers, but to consumers as well. By recognizing browsing behavior, they allow sites to remember user preferences, passwords, and any custom personalization. They also allow advertisers to limit the number of messages a user sees and can target the ads to the audience. This means a 21 year old male won’t get served ads for dentures, which allows advertisers to better target the consumer and utilize their budget more effectively.

Users can easily clear their cookies now, this may not be the case for much longer. With the advent of HTML5 there are new tracking methods  that will make it extremely hard to get rid of them. These new cookies will also give data collectors access to more than just browsing history. The Evercookie created by Samy Kamkar is a perfect example of this technology.  This new cookie could include tracking data such as a users location, time zone, photographs, text from blogs, shopping cart contents, emails and a history of webpages visited. Of course, this is somewhat frightening to many users of the web, and has already created a stir in the industry along with a few class-action lawsuits against some big name companies.

The advertising industry’s hope is that these privacy concerns won’t force government regulation or intervention. Instead, a collaborative has been formed and has created Self Regulatory Principles for Online Behavioral Advertising. This collaborative is well respected and is supported by the American Association of Advertising Agencies (AAAA), the Association of National Advertisers (ANA), the Direct Marketing Association (DMA), the Interactive Advertising Bureau (IAB), and the participation of the Council of Better Business Bureaus (CBBB). The objective is to get everyone in the industry to self-regulate and to follow these seven principles:
• Education
• Transparency
• Consumer Control
• Data Security
• Material Change
• Sensitive Data collection

You can find detailed information on each of these principles at About Ads but the main point of all the regulation is to give consumers the ability to opt out of data collection and to have security guidelines in place. Currently the principles are meant to apply only to First Parties (web site publishers and operators), Third Parties (ad networks and data companies) and to Service Providers (internet access provider, search engine, browsers, or other providers that collect and use data).

In addition to the principles, the collaborative has developed an opt out icon so that consumers can get information on the data being collected and give them an option to opt out. The hope is that all of these measures will satisfy privacy advocates while lawmakers continue to request “do-not-track” legislation.

In truth, this issue is only just beginning. As it continues to evolve it will be extremely important for agencies, marketers and advertisers to keep up to date with future policies to ensure they are in compliance and that consumer privacy is respected.

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    1. The Evercookie may well be a step too far. Some restraint on the advertising industry is required. It seems that Do-Not-Track legislation is inevitable
      .-= Rhuarhii´s last blog ..Product Launch Marketing 101 =-.

    2. Hi Rhuarhi – Thanks for your comment. You are correct. It does look like there will be some sort of legislation put in place to protect user privacy just like the Do Not Call list and CAN SPAM laws.