AOL also describes to Reps. Barton and Markey the way they use cookies that doesn’t reflect what they say to clients--such as “Target users based on attributes from user registration or third-party data (e.g. age, gender, income, kids)… Retarget users who visit your website… Target users within households using Experian’s statistical modeling based on hundreds of offline data elements that are most predictive for defining the specific audience of consumers.†For question 1, they refer to their privacy policy—something few consumers would read or understand. Nor does the privacy policy spell out how AOL collects and targets users, as they do for potential clients. See and compare to privacy policy. See how they offer targeting based on political information.
Question 2: They didn’t answer completely. They should have included information from here. And what their partners collect.
Question 3. They should have said they urge advertisers to use pixels, beacons and other tracking tools:   “Place pixels on all high-traffic pages… Target broadly… Most networks, including Advertising.com, look at IP or cookie data to determine if a user is part of a specific demographic or has demonstrated a particular online behavior, such as shopping for a car, browsing cooking sites, and so on. With user targeting, you reach those consumers directly, regardless of the sites they happen to be visiting.â€
And they say that the third party cookies don’t identify the “specific user.â€Â But that’s what AOL says it can target: “Target users within households… Retarget users who visit your website… Target users within households that demonstrate the highest propensity to buy certain products…â€
Question 7. They don’t say what they do. It’s monetizing all the data: “We monetize nearly 1.5 billion impressions per day on average.â€
If George Orwell were writing today, 1984’s Winston Smith would be working as a “Doublespeak†specialist crafting privacy policies and creating self-regulatory regimes for the online ad industry. None of the replies provided to Reps. Markey and Barton answered the basic charge posed by the WSJ in its series and previously raised by privacy advocates: that “[O]ne of the fastest-growing businesses on the Internet is the business of spying on Internet users.â€Â  All the companies hide behind `it’s a business as we created it and good for everyone’ facade. Many use a scare tactic claiming that the data collection model they developed is responsible for funding online content/publishing and without it much/if not all of the Internet would vanish (as if you can’t have both robust e-commerce and privacy!). Many of the answers to Congress also say that their privacy policies and membership in self-regulatory groups (such as the NAI) reflect best practices (as if they automatically vanish the problems!). The companies don’t take responsibility for the problem or acknowledge that there are privacy concerns outstanding.Â
The responses reflect the Orwellian recasting of industry terms on the data collection practices it created and operates. Behavioral targeting (with $1.13 billion this year in spending for this type of ad) has been transformed into “preference,†“relevant,†or “interest†targeting. Online profiling and targeting is now called “customization.â€Â The industry is running away from the precise definitions they created and use because they are honest terms showing consumers are being tracked, profiled and targeted based on our behaviors and actions. Finally, several of the companies submitted their privacy policies.  In order to full understand them, a consumer (in between taking their children to school or a soccer game, working, shopping, cooking) would simultaneously also have to be a technologist, lawyer, and investigator, to understand and control all the cookies, etc.
Also, the companies resort to a now out-of-date definition of what’s considered so-called personally identifiable information (PII). Cookies, IP addresses, pixels and web bugs, they claim, are “non-PII†and hence fail to raise privacy concerns. Yet both the EU and FTC have said that in today’s online data collection world, the old definition of what’s identifiable no longer really works. The FTC explained last year that “[S]taff believes that, in the context of online behavioral advertising, the traditional notion of what constitutes PII versus non-PII is becoming less and less meaningful and should not, by itself, determine the protections provided for consumer data. Indeed, in this context, the Commission and other stakeholders have long recognized that both PII and non-PII raise privacy issues…
Companies such as Yahoo, AOL, About.com (NYTimes Co), News Corp/MySpace and others are disingenuous in their responses—failing to inform the Congress what they tell their clients and prospective advertisers. Among the most cynically self-serving is Yahoo. First, Yahoo did not describe all the ways it collects data on users when it answered question 1. For example, examine Yahoo’s Advertising Blog, where you can find a discussion of far-ranging techniques used in the data collection process. Most of which are not spelled out or really explained in the privacy policy; See also, Yahoo’s “smart ad†technology that changes the copy in real time based on the data it collects. Its privacy policy really doesn’t explain it in the same way it pitches itself to clients. Yahoo says in its Hill letter that it “may†acquire data from external sources and gives the link to that section of its privacy policy. Not even a multi-tasking genius could opt-out all of that. Nor does Yahoo tell you about the tons of data on consumers their partners collect.  Also, they say in question 3 how they collect data, but tell potential clients a more informed story: “Yahoo! gets to know its visitors to give them what they’re looking for, even when they’re not actively looking. In part, Yahoo! does this by using an industry practice called behavioral targeting (BT)… Yahoo! BT goes beyond common rules-based segmentation or grouping of consumers by the sites they’ve visited. The tool is powered by sophisticated modeling technology based on extensive online interactions that include searches, page views, and ad interactions. With these models, Yahoo! identifies what consumers are interested in and predicts where they are in the buying process, thereby determining which consumers may respond best to your ad placements.† In question 4-5, Yahoo claims its users have all the information they require via the privacy policy. But Yahoo’s information for perspective clients tells a more complete and different story: “With rich media, you benefit from deep reporting that goes way beyond the click. Track time spent watching video, mouse-over interactions, poll results, average number of panels interacted with and much more. If you design it, we can track it… Partner with Yahoo! to produce unique, immersive consumer experiences that integrate your brand…â€Question 9, again, they call it “customized experience†to Congress—and “smart ads†that track and learn about you when they explain it to advertisers.  Question 10. Health and finance. Yahoo failed to tell Congress they track and target consumers health and financial info. And they target teens. For health; finance.
Yesterday, Facebook pitched itself to the global commercial TV industry at MIPCOM. Facebooks’ EMEA rep Joanna Shields touted how Facebook could help generate more viewers and greater involvement with TV programs, such as “X-Factor.” Ms. Shields said that Facebook Places location targeting system might let its users “check in” to a program: “…you could check into a television show and tell everyone what’s happening. You could say I am watching this and you got to see it… It could become a very powerful marketing tool at some stage…It’s all about data, it’s all about making that data available.” Other quotes from Ms. Shields:“The voice of your fan can be amplified to a chorus, and a focus group can be the size of a country…30% of all TV viewers have admitted to being logged onto to Facebook while watching a TV show…[TV program] stories are the beginning of the conversation, and not the last word…I can see someday the ability to sign in using your Facebook ID to a show.”
Danah Boyd, like many other digital media researchers, fails to examine the business practices which shape and construct most of contemporary online media. Ms. Boyd is quoted in last week’s Boston Globe about the Children’s Online Privacy Protection Act saying “[I]t’s well-intentioned, but this legislation has failed on every level.” Ms. Boyd is incorrect.  A whole range of interactive ad practices and techniques commonly found on most digital sites has not been embraced by the under-13 online advertising market. The goal of COPPA was to help structure the commercial online data collection and targeting practices aimed at young people–and it’s done so (just see what kind of data collection and targeting practices occur the minute anyone reaches 13. From that age onwards, everyone is fair game for a wide range of very disturbing practices, most of which collect and use our information). Ms. Boyd and the Globe article are also incorrect claiming that “Congress is considering renewing” COPPA.  The FTC is currently conducting a periodic review of COPPA’s rules and the Congress has held hearings on the law. But Congress doesn’t have to “renew” COPPA.
Finally, a challenge to Ms. Boyd. She is working for Microsoft–which is targeting youth across the globe via its advertising division. Microsoft Advertising is collecting data and targeting teens for junk food and other products. See Microsoft’s “How to Target Young People Online” and other materials, for example. Ms. Boyd needs to analyze what her employer–and other financial backers from the online ad industry supporting Berkman–are doing regarding youth–and hold them and herself accountable.
In 1999, online marketers promised consumers they would protect their privacy. Leading interactive ad companies created the Network Advertising Initiative (NAI) as a scheme to head-off proposals by the FTC that would help regulate online profiling. Now it turns out, says the online ad industry, the NAI really couldn’t work. So they have developed yet another self-regulatory effort. Here’s what online marketers told Ad Week today: “The move marks the most significant regulation the industry has imposed on companies and goes significantly farther than the Network Advertising Initiative, which held third-party advertisers needed to allow consumers to opt out. Doing so, however, was a cumbersome process.“  So the industry didn’t tell the FTC or consumers that the NAI wasn’t consumer friendly and “cumbersome.” Yet they have used the NAI as a political bulwark to head-off consumer protection rules. Shame on them. Meanwhile, in the same story, it’s revealed that only now–as pressure mounts to protect online consumers—does the industry recognize protecting privacy is important: “The guys that drive the industry have figured out this privacy stuff does matter,” said Scott Meyer, CEO of Better Advertising Project, which will help companies comply with the requirements.
The new “aboutads.info” website established by the industry fails to provide consumers serious information about cookies and behavioral targeting and profiling. It reveals how little the industry is committed to protecting privacy and informing U.S. consumers about the process. To see how this new plan is really designed to protect the data collection business, examine the rules for sensitive information. Beyond the children’s privacy law (COPPA) we got enacted in 1998, this scheme permits full-scale collection and use of financial and health information.  Under the “new” self-reg policies, the narrowest of definitions for respecting your financial and health information has been created: “Entities should not collect and use financial account numbers, Social Security numbers, pharmaceutical prescriptions or medical records about a specific individual for OBA without Consent.”
Shame on them. Online marketers spent some $3 billion last year on online financial marketing and will spend $1 billion for pharma and health related targeting in 2010. Consumer data collected by online financial and health marketers, much of which is sensitive and personal, is ok under the industry’s “new” plan.
PS: The folks at Better Advertising need to take a course in online marketing–and change its new website so it really informs consumers about the process. What it has now would get a C-minus in any class on online marketing. They can start with 360 degree targeting, online and offline profiling, rich media, a serious description of online auctions, the tracking process, work on “engagement” and neuromarketing,” social media marketing, etc. Consumers deserve better.
On Monday, the new self-regulation magical “icon” that is designed to make the online ad industry’s privacy problems disappear will be unveiled. A new group called the “Digital Advertising Alliance” will unveil the icon-based plan–all timed to help head-off the kinds of protections and safeguards consumers require. The current financial crisis affecting tens of millions of Americans require that government and big business groups do more than pay digital lip service to consumer protection.
As a kind of litmus test for the new self-regulation effort, see if the icon and the information connected to it really informs you about how data on you is collected and used for profiling, tracking and targeting. For example, last week, the Interactive Advertising Association (IAB), one of the key backers of the new Alliance, released a guide to targeting consumers at the local level. Here’s excerpts of what they say. See if that little icon is being honest when you click it. Of course, we really require rules that eliminate the kind and amount of data that can be collected on you and you family and friends in the first place–as well as honest disclosure on the process. Note as well that all that data on you is expensive–and others are cashing in on information that belongs to you! From the new “Targeting Local Markets” guide:
Explicit profile data Targeting. definition–
Explicit data is “registration quality data†collected either online or offline. For online registration data, the user has certain attributes in his or her registration profile at a particular site or service, and that data is associated with the user’s Web cookie or some sort of audience database when the user next logs in. Offline registration data includes the sorts of data held in the massive offline direct response industry databases built up over the last several decades. These are then matched to a user online when that user logs in somewhere that is a partner of the data company. The site at which the user logs in, usually an online mail or similar site, sends the name/email combination to the data company, which then makes the match and sends back data…pricing–In general, first party data commands a far more variable premium than third party data…Third party data is usually available in much larger quantities, and yet there is often a fee of anywhere between $0.50 to $2.00 or more paid to the data provider by the ad seller – thus increasing the cost of goods sold (COGS) on the ad, and therefore increasing the price…
Behavioral Targeting (Implicit profile data Targeting)-definition-
Behavioral Targeting is the ability to serve online advertising based on profiles that are inferred from an individual user’s technical footprint and viewing behavior…As the medium has grown from a “browsing†experience to interactional so have the levels of information gathered. Newer forms of information include the data collected about influences, social preferences through social networks and an individual user’s content created online…The data is often gathered in real-time and can be used for real-time decision-making so that relevant advertising can be delivered dynamically to an individual user during their online session…Behaviorally targeted advertising commands a higher price because of targeted placement versus general run-of-site (ROS) advertising…Behavioral Targeting can be highly accurate when the user is leaving a digital footprint of their activities as they move through the Web.
Adify–owned by Cox Enterprises–provides online marketing and network tools–including behavioral targeting. It offers advertisers the ability to track you site to site (retargeting), can “deploy tracking beacons,” and uses “sophisticated logic to define targetable behavioral segments.” Adify’s “platform powers more than 160 of the world’s best vertical ad networks, and connects premium brand advertisers to the deeply engaged audiences of thousands of quality mid- and long-tail sites.” Its network provides services for a number of sites, including those targeting African Americans, Gays and Lesbians and others. It now is moving into what is called the “food vertical” business–which means helping quick service restaurants and other food and beverage companies target youth and others.
The FTC is now looking into the digital marketing of food and beverages to youth–prodded by my CDD. No food marketer should use behavioral targeting or any related data collection and profiling technique when targeting children and adolescents. Questions must also be raised about vulnerable populations as well.  Cox should ensure that its Adify doesn’t multiple the country’s obesity epidemic.
Mobile marketers have embraced the behavioral tracking, profiling and targeting paradigm–but they now add real location. Brightkite, which offers “highly targeted mobile media, says it delivers “Ultra-Targeted Advertising,” including:
Real World Behavioral targeting
Want to target people who have purchased items in a hardware store? Or people who go to the movies more than twice a month? Or people that buy coffee more than three times a week? We know who they are, and can put your campaign in front of an audience who cares.
Examples:
For Pantene, we targeted people in hair salons. For Dentyne, we targeted people in social groups of two or more…
Location and Place targeting
We can target by precise geography – such as, people in Tulsa, people within 2 miles of a KFC, people at Costco, people in a bar, etc.
Examples:
For Chevrolet, we targeted people within 3 miles of a dealership on a given weekend.
For Jack in the Box, we targeted people within 2 miles of a restaurant in the week following the launch of smoothies in each restaurant…
Activity
Want to target people who are currently doing something specific? We know what our members are doing throughout the day, so we can get a relevant ad to match their current activity.
Example:
For Grey Goose Vodka, we targeted people over 21 engaged in drinking and nightlife activities…
Weather
We know the location of our millions of users, and we also know the precise weather in each location. This allows us to target or optimize ads according to the local weather. We can deliver ads only when the temperature is over certain threshold, or deliver different creatives if the weather is sunny, cloudy, raining, snowing.
Example:
Diet Coke wanted to target people when the afternoon temperature was over 75°. Big-O tires wanted to target to days with ice or heavy rain.
Microsoft is one of the most aggressive online marketing companies targeting teens online. Across the globe, Microsoft Advertising touts its ability to deliver interactive food and beverage ads on PCs, mobile phones, gaming devices and via IM, Bing, etc. Teens and young adults are the key target–but so are young children. In its desperation to catch up with online ad leader Google, Microsoft has strained to be the “yes we will” digital agency. For several years, Microsoft has had a close tie with Pepsi’s Doritos and Mountain Dew, offering various special games that feature the chip. Now Microsoft is continuing that alliance, as the new Halo:Reach edition comes to market. As explained by Variety, “helping build Microsoft’s brand is Madison Avenue, which has fully embraced the franchise’s main character, Master Chief, and turned him into a pitch soldier, with PepsiCo plastering him on 300 million Mountain Dew cans and 30 million bags of Doritos for the launch of the latest game.”
Microsoft officials–and those who play a influential role in the company–should not endorse digital marketing schemes that target youth–and especially contribute to such major public health problems as youth obesity. For shame, Microsoft.
Teens are ground zero for the digital marketing industry, worldwide, since they are seen as the “always-on” online generation. Companies such as Microsoft,AOL,Sulake, MTV/Nick and many others closely research the digital behaviors of youth–all so they can be better targeted online. This week, Kmart became the lead sponsor for a new online series featuring “product integration” and produced by tween/teen targeting company Alloy Media [now owned by Zelnick Media]. Here’s what Ad Age reported [excerpt]:This week, Alloy debuts “First Day,” its first wholly original series for the web and a branded-entertainment vehicle for Kmart, which will use the program to promote three of its back-to-school product lines: Bongo, Rebecca Bon Bon and Dream Out Loud…Josh Bank, Alloy Entertainment’s East Coast president, saw “First Day” as a creative challenge to build a series’ concept around Kmart’s brand brief. The eight-episode series follows main character Cassie…as she’s forced to relive her first day of high school over again, “Groundhog Day” style…Although Kmart and its products are never addressed by name in “First Day,” each episode will be supported by display and video pre-roll video ads highlighting the participating retail lines, with links to Kmart’s own micro-sites to purchase the products seen in the series. “First Day” will also receive heavy promotion via click-to-expand video ad units from Alloy properties such as Gurl.com, Alloy.com and Teen.com, and exclusive web partnerships with Meez.com, Candystand and Fanpop among others. Kmart’s media agency, MPG, and digital agency, Digitas, helped broker the deal and create the media plan with Alloy.”
Here’s how Alloy Digital explains what it delivers for marketers: “Nobody knows the youth market better. As a pioneer in the digital space, Alloy connects with millions of young consumers online through highly trafficked websites and premium original web programming. What does that mean for you? Access to the highest concentration of teens, tweens and young adults available online. And comScore agrees – the Alloy Digital Network has ranked #1 in its category for the past year…At Alloy, our sole mission is to identify and develop innovative spaces and tactics to ensure your brand message reaches an engaged audience.” They explain to advertisers that they know their youth target well: “We know who they are. Socialites, gamers, skaters, fashionistas – we’re all about what they’re into, where they hang out, who they are “socializing” with and … we know where to reach them. Our networks are unparalleled. No other company can deliver this level of specificity, on this large a scale and with this degree of focus. We are where they are, and so is your message.”
And it’s time to wake up FTC and state a-g’s–let alone parents. Look at how Alloy tries to capture its youthful target via these interactive marketing tactics: Display: Standard IAB units, interstitials
Social Media integration within Facebook, Twitter, and YouTube
and in searching for partners to help them target youth, Alloy explains:
“As a select member of the Alloy Digital Network, you can increase your ad revenue, raise your site visibility, traffic and buzz among users…
Become a Partner Member – Does your site have what it takes to be a part of the network? Established audience? Ad-friendly? The requirements are:
Minimum 100k monthly unique visitors
Content targeting 12-34 demo…”
Teens should not be the focus of non-transparent and unfair online marketing tactics, including data collection. This is part of the current federal privacy and fair rules for online marketing, especially for youth, debate. Stay Tuned!