CREWS: Online marketing myopia

COMMENTARY:

We are in the middle of an advertising revolution, driven by technology. Congress is up in arms over “behavioral advertising” online by companies like Google.

Targeted advertising helps fuel today’s flood of information, frictionless e-commerce, and the global blogger soapbox - so much so that it has become cliche to call the Internet one of the most important wealth-creating and democratizing technologies ever known.

Unfortunately, every new information technology advance stokes privacy fears - and marketing that tracks our online comings and goings is no different.

Behavioral advertising employs heretofore unexploited “tracking” capabilities of the Internet - which reminds us that there is more to the Internet than just the Web at any given juncture, and it’s only 2008.

The cries have become familiar. Is my data personally identifiable? Can it become so? Will my identity be stolen? And if a breach occurs, who will be punished?

Remember how angry we would get at receiving ads that were untargeted spam? Today, the ads are relevant, but we are still not satisfied.

Privacy is not a “thing” to legislate; it is a relationship expressed in countless ways. User preferences preclude one-size-fits-all privacy policy. Online, some hide behind digital gated communities; others parade before personal Webcams.

Trying to legislate would be exceedingly complex, as any law would need to contend with myriad questions. If online privacy is regulated, what about offline? Should the standard be opt-in or opt-out? Who defines “behavioral,” or “sensitive”? Should the federal government preempt state laws? What about non-commercial information collection?

Many companies, of their own accord, already follow principles much like the Federal Trade Commission’s (FTC) proposed opt-in for sensitive information, even when the information is not personally identifiable.

But the rise of the information society amid a “homeland security culture” is an unfortunate coincidence, as it has blurred the important distinction between public and private data. This has complicated things unnecessarily.

Total Information Awareness, CAPPSII and Real ID - such invasive government proposals undermine privacy by preventing data from being confined to an agreed-upon business purpose. Most of the time, government does not need to protect privacy, but to allow it in the first place. (One is reminded of the cartoon of Snoopy typing, “Dear IRS, Please remove my name from your mailing list.”)

An old joke holds that if McDonald’s were giving away free Big Macs in exchange for a DNA sample, there would be lines around the block. But consumers do care about safekeeping their personal information - and increasingly have the means to protect it.

The Internet itself empowers consumers to vent their discontent - through blog backlashes against companies, for example. The result: Firms alter their information handling procedures without being told to by law. Consumers can also avoid certain sites, or use Anonymizer, Scroogle or TrackMeNot, and other such self-help tools. A federal mandate for “choice” isn’t persuasive when choice is increasingly the default.

The fury in the online privacy debate implies that real, unexploited market opportunities exist in providing online anonymity. A marketer does not necessarily want to know who you are, but how somebody like you acts.

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