For consumers to fully understand why behavioural targeting could actually be of benefit to them, marketers need to explain its use far more clearly.

For years, the real intentions and motivations of internet customers has remained a mystery to marketers, revealed only at the last click. Recently, however, behavioural marketing has been gaining column inches as a means of evaluating customer thought processes as they journey online. This silver bullet of online marketing success, which increases sales by focusing on visitors as opposed to visits, has certainly dazzled the industry and stirred as much controversy as it has conjured return on investment.

Online marketers have been eager to craft behavioural targeting into their web analytics strategy to boost campaign results. However, misperceptions are rife and, in their rush to reach prequalified audiences and drive impressive conversion rates, many marketers have left the very audiences they sought to connect with behind.

Getting to grips with behavioural marketing is a complex task, not least because there are different types of behavioural marketing that work in different ways. Any marketer that has sought to understand its nuances can be forgiven for getting confused.

'Onsite targeting', for example, allows site owners to deliver relevant content to audiences, whereas 'retargeting' helps marketers recover abandoned shopping trolleys onsite, through targeted display advertising across ad networks or by email. With ISP-based behavioural targeting, internet providers track users' online journeys across the Web. This not only adds another layer of complexity to behavioural marketing but has also sparked further debate as both consumers and publishers are calling for ISPs to seek their permission before capturing this data. With the industry itself still struggling to fully comprehend the different applications of behavioural marketing, it is no wonder that consumers and the media are uncertain and tentative around the privacy implications of behavioural marketing.

Using web analytics to profile audiences is certainly a vital piece of marketing intelligence. Marketing's very purpose is to identify, anticipate and satisfy customer requirements profitably and behavioural marketing allows this to happen online. Sophisticated analytics have become essential for any marketer looking for a more complete understanding of their customers than free tools allow. Without it audience segmentation is impossible and marketers lose the ability to target with precision and relevance.

At Coremetrics, our Lifetime Individual Visitor Experience (LIVE) profiles are at the core of all our online analytics. These profiles, a complete record of all individual visitor interactions with a website, represent the most accurate and comprehensive source of online data available. Essentially, they provide the eyes and ears for marketers to understand visitors and not stand-alone visits, enabling them to communicate with users in a useful, meaningful way throughout the purchase cycle.

However, the increased conversion rates delivered by behavioural marketing have distracted marketers from securing an essential requirement for success. While congratulating themselves on their rejuvenated campaign success, they have made a critical oversight: customer education. Responsibility for education is also causing a stir, with disagreements over whether this should be an industry-wide initiative, lie with suppliers or with the brands that customers recognise. While providers are encouraged to proactively reach out to consumer audiences, site owners increasingly need to make opt-out mechanisms available and display their privacy policies on their websites. At first glance, the indiscretions of hasty marketers can be forgiven. Struggling to fully grasp the different nuances of behavioural marketing themselves, educating the market is bound to be a challenge. And in the heady, fast-paced world of online, surely it is better to ride the crest of technological innovation rather than allow competitors to seize the initiative, and competitive edge, from their more hesitant counterparts.

Although marketers can be applauded for actively embracing behavioural marketing to augment results, their focus on exploring the medium to attract, convert and retain customers has distracted them from the equally important task of securing consumer buy-in. What's more, this blunder has the potential to turn the golden chalice of behavioural marketing into a poisoned one. Behavioural marketing and online privacy have, in fact, become such an area of concern that three U.K. Members of the European Parliament have recently lodged questions with the Commission seeking clarification on the practice of monitoring internet surfing behaviour.

Their concern appears to focus on the contentious issue of collecting and using information on a customer's online habits without their knowledge. The Article 29 Committee, which monitors data protection law compliance in the European Union, has called for all behavioural targeting to be 'opt-in' as a result.

The European Union is also seeking clarification from the industry about how behavioural targeting is used and how customers’ privacy is assured.

On the other side of the pond, Congress has also become increasingly interested in the implications of behavioural targeting. With U.S. Senate hearings and the House Committee on Energy and Commerce seeking information from internet service providers (ISPs) and technology companies regarding their privacy policies and targeted advertising, self-regulation in the online industry is being scrutinised.

Legal concerns stem from lack of education, which has bred distrust. With marketers themselves not entirely clear about behavioural targeting, consumers and the media have been poorly informed and, unsurprisingly, many have reached the wrong conclusions.

Behavioural marketing is more commonly known as 'behavioural targeting'. However, this term has been quick to court controversy and generate mistrust. Although a dream concept for marketers, the very phrase 'behavioural targeting' has implied negative connotations for consumers. The notion of being 'targeted' in the sites of a faceless corporation and having behaviour precisely monitored naturally has online users reacting unenthusiastically. What's more, consumer groups are rallying against Orwellian (mis)-perceptions and spawning governmental concern. Furthermore, some individuals are actively taking steps to block companies from tracking them -- even those companies who, inadvisably, do not provide them with an opt-out option. Ad blockers can ban cookies from most large ad servers and plug-ins are also available that dilute results by making false search enquiries.

Action is needed to reassure customers and lawmakers alike that information is being used responsibly and is not used to identify individuals. Ultimately, the industry needs to take the time to explain to users what's in it for them. Without understanding the benefits to them personally, it's unlikely that consumers will feel well disposed to it.  A simple linguistic adjustment, using the phrase 'behavioural marketing' instead to dispel negative connotations could be a small first step in addressing anxieties. As could introducing universal opt-out mechanisms to ensure that consumers feel they have choice and their privacy is not being infringed.

Other more assertive measures are also beginning to occur. AOL has devised online cartoon penguins to explain the technicalities of behavioural marketing in a more accessible way to its customers and the IAB is also taking steps to address standards.

Transparency around behavioural marketing is essential. Customers need to understand what data is and is not captured about them. Importantly, the industry must take the time to clearly communicate and reassure them that behavioural marketing is a solution to spam and an opportunity for them to receive offers of interest to save them time and money.
 
Behavioural marketing is a powerful tool for marketers and a huge benefit to consumers. Let's avoid the irony of the communication profession losing out because it forgot to explain.

Richard Sheppard is vice president and general manager EMEA, Coremetrics.