Online Advertising: Behavioral Ads Threatened
There has been a lot of talk this month about the future of behavioral advertising and privacy on the Internet. This coming year could change if and how your team uses ads that target people’s browsing history.
The Federal Trade Commission published preliminary proposals for targeting online ads on Dec. 1, and the Department of Commerce published preliminary proposals for protecting consumer privacy on Dec. 16.
These statements came about two months after the Digital Advertising Alliance (DAA) launched a program that lets users ‘opt-out’ of behavioral tracking. The DAA is a coalition of industry groups that supports industry-based self-regulation for behavioral ads.
Outcome far from certain
What does all this mean? No one is entirely sure. The FTC and the Commerce Department’s proposals are not laws, but folks from the FTC have been speaking with Congress about the issue. And FTC Chairman Jon Leibowitz has expressed dissatisfaction with the industry’s self regulation.
This much is clear: behaviorally targeted advertising is raising privacy concerns. Consumers are seeing the shoes they just shopped for appear in ads on other websites, and that is freaking some people out. Two solutions have been floated:
- The FTC’s preliminary proposal: have a browser-based solution that signals to websites that a consumer has ‘opted-out’ of tracking
- The DAA’s program: let users ‘opt-out’ by clicking on an icon next to an ad. This program has been adopted by at least one major media-buying agency.
The potential for impact
Should either of these options — or some other ‘opt-out’ system — become a wide-spread reality, it could have serious implications for online advertising. Here are two stats to consider:
- An Interactive Advertising Bureau survey of ad agencies earlier this year found that 80% or more of digital advertising campaigns were touched by behavioral targeting.
- A USA Today/Gallup poll in December found that 67% of U.S. Internet users say advertisers should not be allowed to match ads to their browsing history.
A tremendous leap of faith is not required to assume that a sizeable portion of that 67% would gladly opt-out of all behaviorally based ads.
What you can do in the meantime
While Washington and the industry figure out what, if anything, will change, your team should look at its marketing and understand the importance of behavioral ads and tracking in your programs.
Consider what would happen if the ads stopped working as well, stopped working completely, or did not change — and what you should do in each case.
Also, talk to your agencies, affiliates and ad-networks. Find out what this means for the marketing they do on your behalf. The last thing you want to do is to be caught off guard by any changes.