Maybe you’ve noticed this, or maybe you’ve worked on a campaign that uses this tactic: You visit a website to look at shoes, a car, or whatever, then move on to some other website – say Facebook or the New York Times – and an ad for the site or the product you just visited appears somewhere on the page. This is called “behavioral advertising” or “behavioral retargeting.” While some consumers like it, others find it creepy. That “creepiness” feeds into broader concerns about privacy – companies selling consumers data or the NSA scooping up phone records.
Ghostery is a company that’s attempting to insert a level of trust and comfort into behavioral retargeting by giving consumers control over how and when their online and mobile behavior is tracked by advertisers. Ghostery’s free software lets them see all of the entities that are tracking their web activity and choose which ones they want to allow to follow them. Ghostery makes its money by tracking the trackers (not the consumers) and selling that data back to online marketers who want to measure the effectiveness of their efforts.
The Way I See It
- Privacy issues were big news in 2013 – Edward Snowden, the NSA, the Target and Nieman Marcus data breaches. Privacy was top of mind, and Dictionary.com made “privacy” its word of the year. With Heartbleed and other issues, “privacy” might be the word of the year for 2014 as well. All of this anxiety around privacy winds up getting applied to the legitimate attempts of brands and advertisers to provide a quality online experience to consumers.
- The regulatory issues are all over the place, especially for companies that do business internationally. Privacy laws in the European Union are very strict, and seem like they’re about to become even stricter. In the United States, regulation varies from state to state. When it comes to behavioral retargeting, advertisers have tried to get ahead of the game through self-regulation. The Digital Advertisers Alliance recently published a new set of guidelines that includes how behavioral targeting should (and should not) be implemented on mobile devices.
- Privacy is a brand issue. Brand is built on trust, and brands that are perceived as being deceitful or simply just careless with customer data are going to pay a huge price.
The Way the Industry Sees It
On June 10, Davis & Gilbert and Ghostery co-presented a Digital Media & Privacy Seminar, after which I sat down with Todd Ruback, Chief Privacy Officer at Ghostery, to talk about privacy, transparency, and the future of behavioral retargeting.
Take the consumer’s temperature for me. What is the typical consumer worried about related to privacy? And how well-informed is that worry?
Thanks for having me here today, Ron. To level-set, I don’t like the term “consumer.” Not to be nit-picky, but a consumer is someone who buys something and you don’t have to buy something to have your privacy at risk. We’re talking about people. What we see and hear at Ghostery is that people, even if they can’t fully articulate their privacy concerns, feel that as technology has become more embedded into every facet of our lives, society has transformed into a surveillance society. Over 30 million people have downloaded our free privacy tool, Ghostery, which allows them to see who’s tracking them on any given website and to control that tracking. We see an absolute explosion in downloads, over 100% every six months. People care and they are arming themselves with information so they can take control over their online experience. As the Internet has become a pillar of our lives, there is a salient concern that it is a gateway to privacy risk. People are well informed generally, through both the excellent efforts of organizations like the DAA and through self-education.
What do consumers understand or misunderstand related to privacy and behavior retargeting?
People understand that the Internet is free because advertising subsidizes websites. Study after study show that people are cognizant of the quid pro quo that is the present day engagement model of the Internet. Maybe folks don’t exactly know what a “cookie” is, but they know technology is used to track them as they traverse the Internet and is used as a means to ultimately market them something that is related to their interests. That’s both kind of cool and a little creepy. At Ghostery what we are hearing is that people aren’t objecting to this tracking, rather they are objecting to it being hidden. The answer to the real question, which is “what do people want,” is easy. People want transparency. They want openness and honesty from the company that they are choosing to do business with. When I go to Amazon to buy a book I’m cool with given it my credit card info, email and address, so I can buy my book. That’s the trade. But, I’m the one who dictates whether or not I’m okay with it. After all, I came to your site. So the trade in a free Internet model is I will get free Internet and be able to go from site to site, but you get to anonymously track me in order to serve me an advertisement that will be relevant to me. You want to track me, fine, but tell me about it first so I can decide if I’m okay with that. It’s all about empowering the individual with information so they can make the decision that is best for their selves.
What should brands and advertisers be doing to relieve those worries?
Brands and advertisers have a unique opportunity to convert privacy into a value proposition. I don’t mean this in an abstract way either. Privacy can and should be a selling point. There is a 2014 study by Toluna that shows 86% of people trust a company more if it is transparent about its online data practices and they are more likely to buy things from that company. Be open about your online practices, really open and clear; inform the person on your site, empower consumers with information so they can make their own decisions and they will feel like they entered into a fair bargain. And you’ll sell more stuff. Privacy should not only be a value proposition though. Pretty soon we’ll see privacy products from industries like ISPs and these privacy products, as stand-alone products, will create new revenue streams. In addition to being able to buy a “triple play” (Internet, long distance, and cell) from your phone company, you’ll also be able to buy an enhanced privacy package. For an extra $29.95 per month, your cable company will encrypt your data in transit. Want it encrypted in storage? That’s an extra $12.95 per month. Firewall? $8.99. Oh yes, we are a cloud provider too. That’s $14.84 per month. But ISPs aside, we see clear evidence that the more transparent a company is, the more likely it is that it will sell more stuff. Brands and agencies would be well served to develop a transparency strategy, that’s right, you heard it from me first, a transparency strategy. I foresee the creation and evolution of transparency notices and a supplement to privacy policies. This will be where companies tell you how they operationalize transparency. The privacy policies have been high-jacked for good by the lawyers – don’t worry, Ron, I’m one too – but the plain honest business-speak will live in the transparency notice.
How would you rate the industry’s efforts to self-regulate? Are those efforts sufficient of forestalling some kind of government regulation?
I’m proud of the digital advertising industry’s efforts so far. But it is a never-ending exercise, and we could all do more. We shouldn’t be satisfied, regardless of how much we have accomplished. The more the industry can engage with society the better it will be trusted as a whole, and it will obviate the threat of chilling legislation. The DAA’s Self-Regulatory Program for Online Behavioral Advertising is a shining example of self-regulation done right. There is more than a 90% industry participation rate and because of strong monitoring and enforcement by the CBBB and DMA, there is meaningful accountability. That’s the secret sauce. Now we see other countries developing their own versions of self-regulation using the DAA Principles as a template. The EU has it with the EDAA Principles and Canada has it with the DAAC Principles. Soon there will be more programs in other countries as well.
One of the major themes in privacy regulation – whether it’s self-imposed or comes from government – is that changes in technology outpace our attempts to regulate their privacy impact. What new technologies and tactics related do you see on the horizon that might raise privacy questions for brands and their consumers?
This is the coolest industry because of the pace of innovation. Tablets and iPads are only a few years old, yet are embedded in millions of homes. I have one just to read the newspaper. That’s it. I also have a smart phone for work and one for personal use. Digital marketing can track me across all my devices – iPad, iPhone, etc. But like every other industry, laws and regulations naturally lag. Legislatures just aren’t quite as nimble as tech companies. But that’s okay. I’d rather have a well-thought out law that attempts to address an actual risk of harm, then something that is reactionary and has a chilling effect. That said, what I have been predicting for some time now is a wave of transparency laws. The first in that wave was CalOPPA – we are seeing a flurry of privacy legislation coming from California. A few other states are considering different flavors to the same sort of law. Think 2003 with the first data breach law in California. Now we have fourty-seven different state breach notification laws. I predict that we will have something similar in less than a decade for transparency laws. At the Federal level the FTC is also getting into the transparency game, calling for a sectorial transparency law for the data broker industry. This legislation, if enacted like the FTC recommends, would have a seismic impact across industries.
What’s the coolest object in your office?
I’m glad you asked that, Ron. The coolest object in our office is a huge Ghostery poster at the entrance to our office. Ghostery is a hugely beloved brand. And, whenever I walk into the office, I get to see this huge Ghostery poster stuck to the wall by the front door. It makes me smile and reminds me of what a cool company I am part of.