That’s the formula Yahoo is using to please its largest advertisers, explains an article in The Register.Â The report explains that Yahoo’s economist Preston McAfee has created a “magical formula” for its ad targeting service:Â “a formula designed to keep Yahoo!’s largest advertisers as happy as possible. It lets each of those guaranteed-contract advertisers pick and choose â€”Â in remarkably precise fashion â€” how their ads are targeted, even though there are more than three trillion possible targets…Yes, Yahoo! has advertisers who only want to reach women between the ages of twenty and thirty. But it also has advertisers who only want to advertise in cities where the sun is shining. There are brokerage houses who only want to advertise when the stock market is up…What is really ‘magic’ about this is that it gave us a backdoor way to price three trillion different pieces of advertiser demand,” McAfee says…The setup also gives Yahoo! fine-grain control over each advertiser’s campaign. “It gives us a dial to favor an advertiser,” he continues. “If one of our advertisers is not getting enough impressions, we turn the dial and increase their bids, to make sure we fulfill the contract.”
But what’s needed is a policy formula–that creates privacy and other consumer protection safeguards.Â Online marketing’s use of advanced computing systems and real-time ad auctions of data on individual users underscores the problem–the industry is running amok.Â Â Consumers shouldn’t be subject to powerful invisible technologies that track, profile, target and sell them to the highest bidder.