Industry needs to teach users that behavioral targeting, if done right, can actually increase privacy.
Personal privacy is something embedded in Americans' DNA and the issue has never been as large and public a concern as it is today -- largely due to the Internet becoming the world's information and entertainment medium of choice.
In turn, the new capabilities the Internet has brought to advertisers have heightened privacy concerns. What the current advertising and privacy debate fails to realize is that new online advertising methods such as behavioral targeting -- if done right -- can not only shield users' privacy, they can fundamentally change the value of personally identifiable information.
It is time for both consumers and the industry to understand this and accept that the paradigm has changed.
Companies doing business online and the many organizations involved in the development and maintenance of the Internet have, as a whole, been very responsive to privacy concerns through technologies like security certificates, site passwords, secure encryption, and privacy policies that lay out exactly what information is tracked and what the users' rights are. Granted, some of these lessons have been learned the hard way, but they have been learned and the consumer confidence in Internet privacy has steadily improved.
The online advertising segment, however, has lagged behind its peers. Much of the blame for this is put on unscrupulous operators, as current hearings around spam and spyware companies can attest. But those who install software on users' computers without their knowledge, hijack the desktop with pop-up ads and inundate users with email are merely the most visible symptom of the problem. At the root of the matter is the industry's outdated mindset when it comes to privacy.
Advertising grew up in largely non-targeted, imprecise media, where knowing as much as possible about exact individuals being reached was always the goal. This was never truly possible until the Internet. Suddenly, advertisers had access to reams of personally identifiable information (PII) on Web users and began advertising to them directly, raising all sorts of new privacy concerns. While the industry was grappling with a way to leverage its new knowledge while addressing consumer worries, behavioral targeting quietly came along and removed PII from the equation.
Behavioral targeting allows advertisers to get the right audience without ever identifying individual users. The truth is, PII doesn't really help most advertisers. If advertisers can precisely define a target audience segment that is relevant to their business and then deliver their ad to that segment, what does PII get them -- only a violation of trust with an audience that actually wants to hear their message.
Unfortunately, advertisers and agencies have not yet realized this. Many still think they need to intrude on the user -- even though consumers have said time and again that they strongly object to this type of action. Responsible online advertising companies may collect information on user behavior but they never tie that behavior to an identifiable individual.
Yes, advertisers still track and act on users' behavior, but they aggregate information into the sizable, quality audiences that advertisers are seeking while preserving user anonymity. The prospect of Company X knowing you are interested in buying a car, and then being able to reach users directly through a specific email address, physical location, phone number or computer desktop is quite a different proposition than Company X working through a reputable publisher to deliver their message to an anonymous person whose behavior has shown they are interested in buying a car, without changing that person's experience or violating their privacy.
Questions of privacy are one of the main weapons traditional media use to attack the Web, and are holding the online medium from really becoming the dominant advertising medium of our time. While the industry must continue efforts to stop the "bad guys" engaged in spyware and other underhanded methods, it's much more important that the industry change its thinking about identifying users.
Why? Because the old "goal" of knowing every individual is unnecessary since advertisers are only capable of addressing segments and not individuals. If done correctly, behavioral targeting is a new privacy paradigm that protects users, delivers greater value to advertisers, and holds the key to online advertising's future.
Bill Gossman is CEO of Revenue Science, a provider of behavioral targeting in online advertising.