Jumpstart Automotive Group

The scrutiny and extensive media coverage about behavioral targeting practices continues to heat up. And when Google decided to announce its new BT capabilities to the world this month, the buzz about privacy and Federal Trade Commission (FTC) regulations increased ten-fold.

Those, along with other big headlines in the news over the past month could have a sizeable impact on digital advertising. The following three headlines are all intertwined based on their relevance to each other and to the industry:

FTC to Marketers: Self-Regulate BT

Lawmakers Working on New Internet Privacy Bill

Google to Start Behavioral Ad Targeting

In February, the FTC instructed marketers to self-regulate behavioral targeting, basically saying, “Figure out your guidelines and standards as a collective whole, or we’ll do it for you.” Unfortunately self-regulation has been endeavored countless times, unsuccessfully thus far.

Any and every publisher that collects and re-targets users based on cookie information has attempted to self-regulate through standardized privacy policies buried deep in their websites that make no sense to general consumers anyway. It’s also been more formally attempted through companies like the Network Advertising Initiative (NIA) and the Behavioral Targeting Standards Consortium (BTSC).

These efforts, however, have only touched a minute portion of consumers who are online and concerned about their privacy. Consumers don’t actively read privacy policies. The BTSC and NIA are not extensively marketing to consumers about their practices beyond some content on their websites (full disclosure: I am a member of the advisory board of the BTSC). And generally speaking, the majority of consumers are still concerned about their online privacy — up to 58% disagree with the practice of collecting non-personally identifiable information, according to a recent Burst Media study.

An important question that needs to be answered by the industry before regulators answer it for us is: should marketers continue to be able to anonymously target consumers based on interest and surfing patterns? The practice of behavioral targeting creates a better experience for the consumer with more relevant ad messages, and it also helps monetize the free content that they are receiving from publishers, allowing the publishers to continue to operate as a profitable business.

To most members of our industry, BT is regarded as a mechanism that drives greater marketing success and does not invade privacy. To most consumers, it’s a perceived invasion of privacy. But “¦ this perception is caused by confusion, and the lack of true understanding of such practices by consumers.

The industry needs to weed out the bad eggs and punish the companies that are abusing it to get beyond this mystification and move forward. There are companies that have essentially become the ‘spammers’ of BT — namely those targeting at the Internet Service Provider level unbeknownst to the consumer, or those intercepting behaviors from other publishers, stealing an audience, without permission. Moving past this era of blatant abuse of the practices will benefit all.

In the background of all of this, a top U.S. lawmaker in the U.S. House of Representatives said he is working to develop a bill to impose mandatory guidelines on internet companies to protect user privacy, because the current voluntary approach is falling short, as reported by Reuters. Of course, any time a Washington lawmaker is trying to impose standards on industry practices, there’s always that fear of broad reaching rules and ambiguity on specifics that impact the various levels of publishers within the industry.

Crying foul about Washington trying to impose standards is commonplace in the internet era, but at the same time I’d say that in a way we brought this upon ourselves. While organizations like the aforementioned have made their efforts clear, there are too many divided efforts by individual publishers as well as associations like the IAB who have attempted to explain their position on privacy and data collection.

Needless to say, this hasn’t exactly been a cohesive approach to self-regulation. Too many interpretations have only created confusion, and allowed privacy advocates to emerge to the forefront.

What is most interesting about the idea of an internet privacy bill was that Mr. Boucher, a Democrat from Virginia that heads the telecommunications subcommittee of the House Energy and Commerce Committee, states that his plan will be impacted by the prominence and consumer-friendliness of Google’s privacy policy. This was obviously spurred by the recent announcement that Google has entered the behavioral targeting realm, which we all knew was coming with their purchase of DoubleClick about two years ago.

While some reports say that Google has raised eyebrows with this announcement and increased privacy concerns with what they’ve coined “interest-based advertising,” this might ultimately be the best thing that’s happened to our industry since Google effectively did the same thing with search engine marketing earlier this decade — they validated it, simplified it, and made it a universal practice in the marketing world … and billions followed. BT has been begging to be described with those adjectives.

If you can recall, there were dozens of pretenders before Google trying to sell different versions of SEM, with limited success. Google swept in and standardized the industry and everybody won:

• Other search engines and large publisher sites partnered with Google instead of trying to go at it alone and cashed in on Google’s success.
• Nearly every advertiser in any industry turned to SEM due to its ease of execution (thanks to Google) and direct ROI.
• Consumers benefitted because Google created standards for search results and ranked them based on the most important factor to consumers — relevance. The other major engines followed suit.

Google wants to make display advertising — namely through BT – a major part of its business. They view it as the next step to their success in online marketing. With that, they are making privacy an extremely high priority, focusing on transparency and the value and benefit to the consumer’s experience; and also giving them an easy means to opt out of being tracked. These are things that no other publisher has executed effectively in the past for BT. And with it being Google — a public company that is the apple of Wall Street’s eye — the visibility and prominence of their approach will be massive.

It’s not a coincidence that Google entered the BT realm later in the game than most. Their sheer size makes them a target with any announcement made, so it’s in their best interest to tread lightly and manage all of the angles. They historically learn from others’ mistakes and arrive with a more refined and perfected product. My guess is this will also be true of BT, which will help move the entire industry forward and make Jeff Hirsch’s, CEO of AudienceScience, recent prediction more of a reality (He predicted that BT would overtake search growth by 2020 at the recent OMMA Behavioral Conference).

Now that Google has made BT a priority, their announcement could help all publishers, advertisers, and consumers reap the benefits, and ultimately allow BT to follow in the footsteps of SEM — as the next great marketing vehicle that advertisers rely on to successfully communicate their message to the most relevant possible audience.