Category: behavioral targeting watch

All Tracking, All Predicting, All Targeting: Insights into how consumers are behaviorally targeted via the China digital ad market

We live in a world that is being increasingly shaped by the forces of digital advertising. It’s a largely global market after all, and there are very important developments in places such as China, India, and in the United Kingdom that have relevance for online privacy in the U.S. This description of the targeted online advertising model embraced by the China-based PinYou is very revealing of where behavioral targeting is today and headed [our emphasis]:

“The idea is really to understand consumers based on behaviors and profile them based on accumulated inputs. Instead of being reactive, we need to be predictive. Instead of indexing pages, or key words, we are indexing consumers Instead of creating preset segments, we understand multiple dimensions of consumers. As a result, we can deliver ads to the right consumers regardless where they are. We target a consumer not because he is now visiting a page, but rather because he has searched some key words, and he has visited certain sites, etc. As a result, different people see different ads when they log on the same page…The long term vision of PinYou is to allow advertisers to be able to come in and define the specific target consumers based on different dimensions for an advertising campaign. PinYou’s system will profile consumers based on multiple inputs, including demographics, psychographics, category interests, lifestyle and purchasing funnel. Through PinYou’s network of publishers, the ad will automatically appear whenever the target consumers visit the page. What Valueclick recently launched in the U.S “precision profiling” is similar to what we have in mind.”

Ms. Huang does say she is aware and concerned about the privacy issues (and refers to the current political debate in the U.S. over online behavioral tracking). You should read the interview. But to us, Ms. Huang primarily embraces a perspective echoed by online marketers in the U.S. that threatens consumer privacy.
source: “Interview with Grace Huang, Founder of Behavioral Targeting Startup PinYou.” Kaiser Koo. Ogilvy Digital Watch. Aug. 15, 2008

Behavioral Targeting Lawsuit Illuminates How Data is Collected From You

Look for a moment at an excerpt from a legal tangle between behavioral targeting companies Valueclick and Tacoda (the latter now owned by Time Warner). Valueclick filed suit on July 15 claiming patent infringements, including for one entitled “Method and Apparatus for Determining Behavioral Profile of a User.” Read the “Abstract” and part of the “Summary of the Invention” for this patent and think about your privacy (and that this is based on 1998 technology!):“Abstract: Computer network method and apparatus provides targeting of appropriate audience based on psychographic or behavioral profiles of end users. The psychographic profile is formed by recording computer activity and viewing habits of the end user. Content of categories of interest and display format in each category are revealed by the psychographic profile, based on user viewing of agate information. Using the profile (with or without additional user demographics), advertisements are displayed to appropriately selected users. Based on regression analysis of recorded responses of a first set of users viewing the advertisements, the target user profile is refined. Viewing by and regression analysis of recorded responses of subsequent sets of users continually auto-target and customizes ads for the optimal end user audience.”

Summary Of The Invention: …Over time, the tracking and profiling member holds a history and/or pattern of user activity which in turn is interpreted as a users habits and/or preferences. To that end, a psychographic profile is inferred from the recorded activities in the tracking and profiling member. Further, the tracking and profiling member records presentation (formal) preferences of the users based on user viewing activity. Preferences with respect to color schemes, text size, shapes, and the like are recorded as part of the psychographic profile of a user…The tracking and profiling member also records demographics of each user. As a result, the data assembly is able to transmit advertisements for display to users based on psychographic and demographic profiles of the user to provide targeted marketing.”
source: Complaint for Patent Infringement: Jury Trial Demanded. Valueclick, Inc. v, Tacoda, Inc. Case No. CV08-04619 DSF. U.S. District Court, Central District of California, Western Division.

Google’s patent to target social media ads: monitoring online communities

Google has been assigned a patent which abstract says is: “[A] computer-implemented method for displaying advertisements to members of a network comprises identifying one or more communities of members, identifying one or more influencers in the one or more communities, and placing one or more advertisements at the profiles of one or more members in the identified one or more communities.” Google may be joining the rush to further monetize (and spy, as far as I’m concerned) on social network communities. Social media marketing is the latest boomlet in online advertising. Here’s an excerpt from the patent.  Btw, I don’t see the word privacy mentioned in the patent application! [my bold]:

As the Internet has become increasingly popular, online social networks are becoming an important and pervasive mechanism for communication, entertainment, and professional and social networking. Members of a network implicitly associate or explicitly link themselves with one or more members within the network based on factors such as common interests. Interaction and signaling between members either directly or through other members cause the formation of communities of common interests within the online social network. The members of such communities are connected by one or more common interests.

Factors such as member interactions, content on member profiles, dynamically changing size of the community, and the like establish a hierarchy within a community where certain members are more popular than others and, consequently, wield enhanced influence over other members in the community.

SUMMARY

The present inventors recognized that blanket advertising across the network tends not to be cost-efficient to advertisers, since the members of the network tend not to be interested in the products and services being advertised unless the advertisements are relevant to the members’ interest. Presenting to advertisers a community of members sharing a common interest provides advertisers with an opportunity to present products and services of interest to the members of the network, thereby maximizing the return on the investment made to advertising.

The present inventors also recognized that advertising to members of an online social network based solely on the content of their profile lacks targeted generation of advertisements. Members of a community may have content on their profile in addition to the common interest of the community, such as personal information, etc. Relying solely on the content of the profile of a member of a community decreases the specificity of advertisements to the community since the presence of additional information distorts the signal from the content related to the common interests.

In one implementation, a computer-implemented method for displaying advertisements to members of a network is described. The method includes identifying one or more communities within a network, wherein the community can include a plurality of members of the network, identifying one or more influencers in the one or more communities, and placing one or more advertisements at the profiles of one or more members in the one or more communities…

The systems and techniques described here may provide one or more of the following advantages. First, a system can identify communities of common interests within an online social network. This may allow advertisers to target the communities based on the common interest of the community, as opposed to the content of individual profiles. Second, a system can identify members who belong to overlapping communities as a result of more than one common interest. By blending advertisements relevant to the interests of each of the overlapping communities, advertisers may target the members common to these communities. Third, a system can identify the influencers from among the members of a community. This may provide advertisers with the option of targeting either all members in the community or advertising only on the profile of the influencer, thereby targeting the entire community.

In addition, the system encourages members of communities in online social networks to enrich the content on their profiles. The presence of high quality content relevant to shared interests on a member’s profile increases the popularity of the member in the community and improves a member’s chances of being an influencer. An influencer may receive financial incentives from advertisers in exchange for permission to display advertisements on the member’s profile.

Letters to Hill on Online Advertising and Privacy: A Failure to Communicate

The two headlines coming from the responses sent to the House Energy and Commerce Committee so far are that trials of deep packet inspection ad tracking/targeting were launched without meaningfully informing subscribers, and that the companies really failed to fully disclose all the data collection and targeting they routinely do.

On the second point, a strategy by several companies was to gloss over what they collect from behavioral targeting. You would never know reading AOL’s letter, for example, that it acquired behavioral targeting leader Tacoda last year [which is now integrated into AOL’s “Platform A” system]. AOL’s letter to the Hill is a fairy tale version of the targeting it can do. To see a video produced for AOL’s Advertising.com that is more honest about its ability to collect and target, see its “Holy Grail of Online Advertising” animated promo.

Charter Cable, which was working with NebuAd until advocates and Congress raised the alarm, suggests for whatever online ad services it does on its website, it relies “on third-parties, such as Yahoo and Google to perform these functions.” But it promotes its vehix.com site saying that: “More leads. Better leads. Precise geographic and demographic targeting. Unparralled branding power. Vehix.com isn’t just another dot.com vehicle site. Vehix.com is a powerful new way to combine the targeting precision of Cable TV and the internet to create a powerful sales building program.” Comcast answers the Congress by repeatedly claiming that it doesn’t target individuals online. It could have included in its letter what it says to potential advertisers, that: “On a monthly basis, Comcast.net receives over 3 billion page views, 15 million unique users, average visit length of over 14.9 minutes and over 60 million video streams. Comcast.net Mail Center has over 20 million registered accounts, 7 million logins per day and over 2 billion page views a month.” None of the cable companies, of course, said a word about their coordinated moves into personalized interactive television ad targeting (Project Canoe). Insight cable could have included in its letter a section from its privacy policy, which says that:“Our Website may post banner ads or other forms of advertisements and/or links from third party advertisers that are not owned or operated by Insight or Insight Entities. These third party advertisers may independently solicit and collect personal information, or send their own tracking devices to our visitors. Other third party Internet programs or applications may also cause additional advertisements or banner ads to appear on top of our web pages. Insight does not have control over the placement of such advertisements or the tracking devices utilized through these applications. When you visit a third party advertiser’s Website, you will be subject to the privacy policy and terms of usage agreement of that Website operator.”

Of course, the tests by CableOne, CenturyTel, and Knology reveal the failure of the current disclosure process. Customers shouldn’t be required to read complex and confusing legal updates about privacy policy. The lack of candor from Google, Yahoo, Verizon, Comcast, etc. should be addressed by the companies quickly supplying new information to Congress about their complete data collection and targeting practices and plans.

Google’s letter to Congress on its Privacy Practices: An Attempt to Shift the Focus to Deep-Packet Inspection Issues

Late last evening (10:06 p.m. eastern), I received an email from the Google policy blog list announcing they had submitted a letter to House leaders on privacy and online ad issues. (There’s a case study on media management that can be made about late night-Friday releases designed to avoid weekend or even Monday press scrutiny.)

Google’s letter attempts to shift the focus of the privacy debate to companies engaged in deep-packet inspection–the cable and phone broadband providers. While ISP monitoring and control over a users data flow is inexcusable–and should be prohibited–Google’s data collection and targeting system is of equal concern. There is a purposeful strategy by some to make the only online privacy problem ISP deep-packet monitoring. We don’t buy that–nor should Congress. Like Yahoo!s submission, we don’t believe Google was forthcoming in what it collects and uses for its digital marketing systems. This blog has covered some of what they do in the past–and we will return to the issue early next week (because even bloggers have to take some time off on the weekend).

In its letter, for example, Google should have discussed the privacy implications of opening up its network to third party ad servers engaged in behavioral targeting. It should have provided Congress with information on the data DoubleClick collects and analyzes for target marketing. Or it could have explained how it tracks our use of YouTube so it can inform advertisers which videos are going “viral.”

More on Monday.

Yahoo! fails to address privacy concerns about its behavioral targeting apparatus. Letter to Hill not candid

The spinmeisters who wrote Yahoo!’s letter to House leaders didn’t do a real service for the troubled online company. They weaved and dodged the issue. Yahoo! took a trick from George Orwell by trying to reframe the privacy-threatening interactive data collection & targeting system by calling it “customized advertising.” Yahoo! also tried to hide behind the First Amendment by suggesting, as others have done, that without online ad revenues we would lose what “has made Internet content and services available to millions of people in the United States and around the world(3) – for free.”

Hold it Yahoo! No one is saying there shouldn’t be online advertising and targeting. But what is needed is full control by individual users who can decide what can be collected and how it should be used. That’s called opt-in, and it’s the approach Yahoo should have announced–instead it is trying to protect itself by resorting to an “opt-out” process that it knows won’t really safeguard users.

Yahoo should have told Congress exactly what it collects and how it does it. For example, they should have told Congress what it said to advertisers in 2007: That “Yahoo’s pinpoint targeting capabilities can zero in on a large concentration of precisely the prospects you want.” They should have added that in the same document they explained that advertisers could use Yahoo to “Motivate consumer behaviors (registration, trial, purchase, store visit, frequency, brand loyalty).” It could have explained the “data collection ad units” it offers to advertisers. Missing too, for example, was any discussion of so-called Yahoo “Smart Ads.” The company should have told Congress that these behavioral ads provide “Ease of micro-targeting and segmentation of campaigns…Using an offer management database and user insights…”

Instead of claiming that it doesn’t really do local targeting, Yahoo should have cited from its “Spot Marketing” materials, telling Congress about its “4 Steps to Local Media Efficiency…Reach!–Use Geo/Demo targeting on a State, DMA or Zip Code Basis; Relevance!–Behavioral Targeting, Yahoo! Maps and Contextually Relevant Properties; Creativity!–Maximize Engagement By Combining The Best of Offline & Online Creative Into A Single Rch Media Ad Unit; Insights!–Measure Campaign Effectiveness With Yahoo’s Analytics Suite Including Rich Media Engagement Metrics.”

Yahoo could also have told Congress what it says to pharmaceutical and health marketers:
“Treat with Surgical Precision.
Utilize purchase data from Yahoo! / AC Nielsen Consumer Direct to target actual buyers of related and competing products – while monitoring offline sales impact.

Find consumers by health condition with Yahoo!’s anonymous Behavioral Targeting – drawn from search, editorial, registration and more.”

Yahoo should have done better, especially at this time of real crisis over its future and management. By the way, we also believe that Yahoo was engaged in doing political damage control. With the Department of Justice currently reviewing the proposed Google/Yahoo joint venture, we think Yahoo is attempting to head off concerns about the merging of two of the world’s largest data sets on user behavior.

Key Role of CDD & USPIRG Recognized for Work Exposing Behavioral Targeting Threats

Here’s an excerpt from a story released yesterday that was written by Wendy Davis. We are very proud of our leadership role in exposing the threats to consumer privacy from interactive marketing techniques shaping our digital media system. Unlike some other groups, we are independent and don’t–and would never–take corporate money.  From the Daily Online Examiner:

“For the most part, online behavioral targeting seemed to fly under lawmakers’ radar earlier this decade, when companies like Tacoda and Revenue Science were getting started. That situation had started to change by 2006, when the Center for Digital Democracy and U.S. Public Interest Research Group filed an FTC complaint about behavioral targeting techniques. The FTC held a town hall meeting last November, but few people were yet discussing NebuAd and other companies that rely on data purchased from ISPs.”

source: NebuAd Faces Economic Squeeze. Wendy Davis. Daily Online Examiner. August 7, 2008. [reg. required]

Google studies the online behavior of tweens (10-14 year olds) with message to target them via search advertising

When Google acquired DoubleClick last year, they also took over its search marketing division called Performics. A new study commissioned by Performics focuses on the media behaviors of 10-14 year olds, so-called tweens. The aim of the study is basically to get more online targeted marketing aimed at young people. The senior VP of search operations at Performics–Stuart Larkins–recently wrote an article on the new study that appeared in Chief Marketer. Here are some excerpts.

“At DoubleClick Performics, we sought to better understand the online search and purchase behaviors of seven influential demographic segments and commissioned ROI Research to study these habits across 10 different product categories. Results just arrived for one of the most dynamic segments – Tweens, consumers between the ages of 10 and 14…Tweens consume information through many channels, but the Internet leads. When asked how much time they spent with various media types, 83% said they spend at least an hour per day online, and 68% reported at least an hour per day watching TV. Radio, magazines and newspapers came in much lower…

Nearly half of respondents go online many times per day (more than three), and 87% usually spend at least a half hour each time. Looking closer at this time spent online, the survey found:

72% have a profile on at least one social networking site
· 54% have a MySpace profile
· 35% have a Facebook profile…

For search engines, Google was the overwhelming choice among tweens, with 78% indicating they use Google most frequently…

Tweens reported varying levels of involvement across product categories…

To capture the demand generated in complementary channels, marketers should incorporate search ads into other online and offline marketing campaigns. While a nice rule of thumb for any marketing program, this golden rule is especially true when targeting tweens.”

A story on the Performics study in today’s Marketing Daily noted the research came just as kids were getting ready to get their back- to- school gear. As reporter Tameka Kee explained, the study showed that “search marketing in the media mix is crucial to snagging the attention and influence of tweens, as they are increasingly using search to make product recommendations and find pricing info for their parents...Peformics also found that tweens were using search to find specific product information and store locations across multiple product categories. Nearly half of all respondents said that they used search to find product Web sites in the electronics, telecom, apparel and CPG categories, while nearly half said that they used search to find out where to purchase said products online.”

Marketing is a fundamental part of our lives–and will be increasingly so with digital media. But researching the online media behaviors of young people so they can be targeted with interactive digital marketing raises a number of policy issues, as well as parental concerns. We know that Google has announced plans to sell Performics, although it will incorporate some of its activities within its business operations. But Google’s senior executives should play a leadership role in addressing how to ensure the healthy development of young people. Consumer and childrens’ advocates in the U.S. and the EU-among other places–will be watching closely.

Update. The announcement just came from the Google press office that global ad giant Publicis will acquire Performics. Of course, Google and Publicis are also working together and announced an alliance earlier this year.  Here’s an excerpt from today’s email to the press: “Publicis Groupe and Google (NASDAQ: GOOG) announced today that Publicis Groupe has agreed to acquire the Performics search marketing business (Performics) from Google. Chicago-based Performics, one of the leading search marketing services providers, helps to improve the performance of advertisers’ investments and maximize
client campaign effectiveness. Its profit-driving suite of marketing solutions includes Performics’ reporting platform, local platform, advanced market expertise and active account management….Publicis Groupe has been a leader in the advertising industry for decades, and we believe Performics’ growing business will benefit from being part of it,” said Eric Schmidt, Chairman and CEO, Google. “We look forward to working with Performics as a partner.”

Online Advertising’s tracking and measuring metric–Engagement

Over the last few years, the global advertising industry has been working on a new way to measure the impact a marketing message has on individual consumers. “Engagement,” as its called, is an evolving concept–but it raises serious privacy and consumer protection concerns. Online advertisers are especially focused on the concept, as they sell access to users via online videos and other interactive services. In a recent issue of Marketing Week (UK), there was a useful definition of engagement via a letter to the editor. Since the mechanisms involving engagement–such as user tracking–need to be on the public interest radar screen, we thought it would be useful to cite the definition here [our italics]:
“The term engagement refers to the level of attention an ad draws from a user–weighting up how effectively it is in the real world. The measurement takes into account the overall interaction rate, which is a figure determined by the overall click-through rate, interaction with specific objects within the video and viral effects such as video sharing or emailing.”

From: “Interactive video ads increased engagement.” Letter by Irfon Watkins, Chief executive, Couli, Bristol. Marketing Week. July 10, 2008.

Comcast is no longer a cable company, says Brian Roberts. It’s “a new products company”

Cable’s triple play is turning into a multi-dimensional effort designed to take advantage of its monopoly positions in cable TV and broadband (with mobile coming down the pike). Data collection and targeted advertising is on its agenda, as it is with phone company ISPs. Right now Comcast and other cable companies are working to build an interactive ad system— which raises all kinds of privacy, data collection, interactive marketing and consumer protection, and antitrust issues. This is no slow cable boat adrift on the digital sea, but a well-funded effort that–in part–is connected to Project Canoe. So we were not surprised when we saw this quote from Mr. Roberts during a February 2008 call with analysts: “Over the last few years we have successfully transformed Comcast from a cable company into a new products company that utilizes one infrastructure to deliver a growing number of products.”