Google and WPP Fund Neuromarketing Research for Digital Ads: Ethical Issues and the Need for Policymaker Scrutiny [with an update on the grants!]

The Wall Street Journal and other publications report that Google and ad giant WPP will announce today the $4.6 million grants it will award for academic research designed to “improve understanding and practices in online marketing, and to better understand the relationship between online and offline media.” Among the research efforts given funds are projects that will “analyze internet users’ surfing habits to determine their thinking styles, such as whether they are most influenced by verbal or visual messages or if they are more holistic or analytical, and how to tailor ads accordingly” and an “analysis into how online ads effect blood flow to different areas of the brain. This research would seek to show the role that emotions play in decision making.”   Academics from MIT, Stanford, and Harvard will receive funds, among others. (And for those of us concerned about the role online advertising and data collection is playing in China–and impacts human rights and environmental sustainability–one of the new grants will fund “how Chinese web users respond to different online-ad formats, such as display and search ads”).

As we will tell the European Commission at the end of the month, at a workshop they have organized to discuss interactive advertising and consumer protection, the evolving role of neuromarketing with online advertising raises a number of troubling concerns–and should trigger a serious policy review.   We have not yet seen a final list of the grantees.  But Google should be funding independent research that will honestly explore the impact and ethics of online marketing.  They should be ensuring that the ethical issues of online marketing–such as the concerns raised by their new behavioural profiling and targeting system–receive a honest scholarly review.

The growing controversy over the role pharmaceutical companies are playing with scholarly research on drugs, we think, has implications here.  We believe all the academic institutions receiving these grants must vet them to ensure they truly address the real impact online ad techniques have on individuals and society.

Update:  Google & WPP made the academic research announcement–eleven grants awarded.  Here are some to ponder–and raise questions:

*  “Targeting Ads to Match Individual Cognitive Styles: A Market Test”; Glen Urban, Professor, MIT Sloan School of Management;

*  “How do consumers determine what is relevant? A psychometric and neuroscientific study of online search and advertising effectiveness”; Antoine Bechara, Professor of Psychology and Neuroscience, Department of Psychology/Brain & Creativity Institute, University of Southern California and Martin Reimann, Fellow, Department of Psychology/Brain & Creativity, University of Southern California;

*“Unpuzzling the Synergy of Display and Search Advertising:Insights from Data Mining of Chinese Internet Users”; Hairong Li, Department of Advertising, Public Relations, and Retailing, Michigan State University and Shuguang Zhao, Media Survey Lab, Tsinghua University;

*”Are Brand Attitudes Contagious? Consumer Response to Organic Search Trends”; Donna L. Hoffman, Professor, A. Gary Anderson Graduate School of Management, University of California Riverside and Thomas P. Novak, A. Gary Anderson Graduate School of Management, University of California Riverside;

*“Marketing on the Map: Visual Search and Consumer Decision Making”; Nicolas Lurie, Assistant Professor of Marketing, College of Management, Georgia Institute of Technology, College of Management and Sam Ransbotham, Assistant Professor of Information Systems, Carroll School of Management, Boston College.

“…distinctions between government services and political campaigning are being blurred as politicians use Internet technology”–National Journal

excerpts:  In general, federal laws bar the use of government assets for political campaigning. But the much-lawyered distinctions between government services and political campaigning are being blurred as politicians use Internet technology to extend their advocacy…White House officials declined to be interviewed on the rules governing the separation of campaign and state data.

“There are indications that the administration wants to revise some of these laws, particularly with respect to the Internet, and we’re waiting to see if we can play a role,” said Peter Greenberger, a former regional campaign manager for Al Gore’s presidential bid who now heads Google’s Elections and Issues Advocacy team. “The real question that people are trying to answer is what can the White House do now that they’re the White House as opposed to a [political] campaign.”

Finding that line will mean answering questions about rules that bar the use of government assets for political campaigning, contracting rules that limit the ability of officials to hire one company rather than another and laws that bar government officials from favoring contractors, said Google officials. Also, added Greenberger, “There would be issues providing some services to an elected official that is not provided to somebody else,” such as a political opponent. But, he added, “in some cases, you know, incumbency is a powerful thing.”

source:  Google Stands To Gain From Capital Connections.  Neil Munro.  National Journal.  March 17, 2009.

Google Does Behavioral Targeting. Why Is It Trying to Fool Users & PolicyMakers By Claiming it’s “Interest-Based” Advertising? [Annals of Commercial Surveillance]

Google has finally fully entered the behavioral targeting business, although they are trying to disguise it through an Orwellian change of language by calling it “interest-based” advertising. The world’s largest and most dominant online ad system is expanding its data collection and targeting activities whenever we search, view videos or read blogs.  This isn’t really about, as Google’s blog suggests, “more interesting” ads for consumers. It’s about a further expansion of Google’s already considerable data-mining and interactive marketing and data-tracking/targeting arsenal, which now also includes using neuroscience for its YouTube ads.  Google is further endorsing a global culture with data collection, profiling and targeting at its core.  No matter how Google attempts to frame it as “better for you ads,” digital advertising is designed to influence our behaviors in non-transparent ways.

This announcement, which was done so Google can better incorporate all the behavioral targeting technologies it acquired when it bought online ad targeting giant DoubleClick, is also designed to help head-off the enactment of privacy laws in the US and EU (Google isn’t alone here.  Microsoft, Yahoo and others are in a global race in attempt to preserve the data collection status quo under the cover of industry self-regulation).  Giving consumers access to their (incomplete and likely to constantly be revised with even more targeting categories) profile has to be viewed with such a perspective–it serves as a smokescreen so Google can broaden its data collection and targeting (and become even more dominant in the global online ad business).  Instead of having the default be no data collection without prior expressed informed consent, Google has created the system as an flawed opt-out.  Missing from what users should know and control in their profile are the applications online marketers use to develop the ad so it can more effectively target (and collect data), including: neuromarketing, viral videos, rich immersive media, social networks, online product placement, etc.

Yesterday, Google should have called on Congress, the EU and other governments to enact meaningful consumer privacy safeguards.  While it is entirely to be expected that as the world’s largest online ad company Google would fully embrace behavioral targeting,  it’s also unfortunate.  Eventually–and we hope soon–responsible shareholders, such as socially conscious investment funds, and global regulators will hold Google–and other online marketers–more accountable to the public.

But stay tuned for the next entry, on what Google, Microsoft and Yahoo have done to evade privacy safeguards for behavioural targeting in the UK!

The real digital TV transition: Why TV “Advanced Advertising” [aka Project Canoe] Raises Privacy & Consumer Protection Concerns

The cable and telephone industry have Google envy.  These broadband communications giants recognize that online advertising companies such as Google and Yahoo have created an enormous market for themselves through the delivery of online ads.  Comcast, Time Warner, Verizon and others want to use their Bush Administration-given broadband monopoly status to gain a significant share of this market.  Cable giants are also working together to transform television so it can better compete with online, and target viewers with more precision and in-depth ads.  The goal–for cable, phone and online ad companies–is to eventually provide a seamless system that tracks, profiles and targets us across every “screen,” including TV, PC and mobile.

Comcast is heavily investing for such a viewer/user tracking world.  It has plans, according to the trade publication Multichannel News to create a “gigantic database called “TV Warehouse,” able to store a full year of statistics gathered from digital set-tops in more than 16 million households nationwide…TV Warehouse, envisioned as having a massive 500 Terabytes of storage, would then feed up to a database even broader in scope operated by Canoe Ventures, the advanced-advertising venture formed by Comcast and five other large MSOs.  The idea: to give advertisers an enormous set of actual viewing metrics — showing exactly what millions of cable customers watched and when — as opposed to representative samples.”

Not surprisingly, Comcast’s Brian Roberts has said his company should no longer be viewed as merely a provider of television:  “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.”  Advanced Advertising, which is what the cable industry’s technical consortium known as CableLabs calls it, is one of the major products Comcast and others will soon provide.  According to CableLabs, “Advertising is growing in importance for cable operators. CableLabs is currently supporting activity in four areas designed to create new revenue opportunities around advanced advertising technologies. These areas are digital ad insertion, interactive advertising, reporting, and addressability.”   Cable executives are working with advertising companies to “…agree on a valuation metric. What’s a click worth?”

But the core concern with Advanced Advertising is the tracking of viewers, including the use of internal and outside databases for targeting. Comcast Spotlight, for example, offers marketers access to a broad range of databases for more precise targeting. Acxiom offers cable and other providers a host of database segmentation services, including its Personicx VisionScape. “With PersonicX VisionScape, marketers have at your fingertips real-time access to a wealth of information… that can help them understand more about their customers – what type of products they use, their purchasing behaviors, their channel and media preferences.  The PersonicX household-level segmentation system is built with InfoBase-Xâ„¢ data and places almost every U.S. household into one of 70 distinctive segments and 21 life stage groups based on specific consumer behavior and demographic characteristics.”

Cable’s work to create a more powerful viewer data collection and targeting system has been out of public and policymaker view.  Cable engineers have been working  together to perfect the technology that will allow it to merge “content and subscriber metadata for targeting zones (or, in a unicast environment, for targeting individuals) to bring the right ad to the right consumer at the right time.”

The phone and cable companies, knowing that the 1984 Cable Communications Act contains privacy safeguards for interactive TV ads and aware of the current debate on behavioral targeting, claims that such data collection and targeting will be anonymous and could include an “opt-in.”  We don’t believe any cable or phone consumer is being told the extent of the plans underway to track and target them.  For example, Alcatel’s product for IPTV related advanced advertising explains that:
“To capture the full revenue potential of targeted and interactive advertising, IPTV providers need to ensure that the following critical actions are addressed:

  • Capture and measure — The network must be able to collect “opt-in” subscriber information from a broad range of databases, which advertisers will use to reach specific “targeted” markets. This anonymous data includes usage patterns, subscriptions, demographics, location, presence and preferences — including how, when and where advertising messages are delivered, along with the type of device that is used. In addition, accurate measurement capabilities are needed that can verify audience response and track the effectiveness of ad campaigns…
  • Activate and interact — Finally, this data, combined with the right systems and infrastructure must be able to deliver personalized and interactive ads to the right consumer, at the right time.”

Consumers/subscribers should decide whether such an advanced system can target them at all.  Beyond informed consent (and data security), there need to be clear safeguards.  Targeted ads for financial, health, and products aimed to children and adolescents raise consumer protection issues.  I have real concerns about “ethnic” profiling, given how lucrative advertisers realize the Hispanic and African American markets are.  We believe that the cable industry has to engage the public in a serious debate about the scope and goal of its Project Canoe and advanced advertising initiative.  Congress, the FCC, and the FTC must become more proactive to protect our privacy from this new approach.

PS:  This week’s Multichannel News offers insight into the latest developments.  Here’s an excerpt:  “This year, the largest cable operators in the U.S. plan to have upgraded at least 20 million digital set-tops with code to run standardized interactive-TV applications. That will make it possible for viewers to click a button on their remote to, say, ask an advertiser to e-mail them more information…The industry over the last two years has coalesced around a common technical standard, maintained by CableLabs, referred to as Enhanced Binary Interchange Format, or EBIF (pronounced “EE-biff”)…Comcast, for one, claimed it had deployed EBIF user agents on more than 10 million Motorola set-top boxes by the start of 2009. The operator hopes to complete the rollout to its entire Motorola footprint, about 20 million boxes, by midyear…” [Interactive TV Begins to Bloom.  Todd Spangler.  Multichannel News.  March 3, 2009].

FTC’s Behavioral Ad Principles–the last act of the Bush Administration? Why is the Obama White House Allowing the FTC To Remain Under the Leadership Appointed by Pres. Bush?

In a few hours, approximately between 10-11 am eastern, the FTC is expected to release its final “Online Behavioral Advertising Principles.” Originally released for comment in December 2007, the principles are a sort of Valentine’s Day present to the online ad industry from the (supposedly departed) Bush Administration.  From what we know, the FTC principles support self-regulation.  Online marketers will be told they should behave better–and here are suggestions.  It’s like a teacher telling a misbehaving student–‘behave better, dear,’ or else we will have to tell your parent (in this case, the guardian being potential congressional action).

My CDD urged Commissioners Harbour and Leibowitz to issue separate statements on the principles, and call for tougher requirements—especially in the area of so-called sensitive information.  This would include data connected to our financial and health related online activities (think mortgage and loan applications or queries for prescription drugs).  CDD and a coalition of groups also formally asked the commission to impose serious privacy safeguards for both children and adolescents.

But these principles were crafted within the narrow confines of the Bush Administration philosophy prevailing at the FTC.  Only self-regulation is permitted.  Consequently, such an approach likely means these rules leave the online data collection, profiling and targeted marketing system which comprise behavioral marketing off the privacy protection hook.

But one question looms at the moment.  Why has the new Obama administration allowed the FTC to remain under the leadership of Bush-appointee William E. Kovacic? The principles being issued today, in fact, reflect the “old” FTC, not one run under the philosophy of President Obama.  Why is the Obama White House failing to ensure a change of leadership at the FTC?  The agency is responsible for overseeing a huge portion of the economy, including critical financial issues.  It’s also supposed to be the leading agency on consumer protection issues.   The Obama White House should have–by now-found someone who would led the FTC, so it can better protect the public.

The principles being released today were only made possible because of the Bush FTC give-away to Google, when it approved its takeover of online ad giant DoubleClick.  CDD, the Electronic Privacy Information Center (EPIC), and USPIRG fought the merger, including on privacy grounds.  FTC Commissioner Pamela Harbour played a key role forcing the agency (then run by Chairwoman Majoris, whose husband’s law firm represented DoubleClick) to address the privacy concerns. As a consequence of the political pressure from its failure to seriously examine the consumer privacy issues of the Google deal, the FTC staff were told to develop these principles.

The next chair of the FTC needs to take privacy and online consumer protection issues seriously.  The agency does need more resources, but also a new spirit.  If the FTC had been on the job, and was examining how lending institutions were recklessly promoting loans and mortgages, maybe today’s mess wouldn’t be as tragic as it is.  More to come after the commission releases the principles.

Google, YouTube, and DoubleClick Cookies Placed on Users of YouTube’s new Congress Channels, Says Computer Scientist

Columbia U computer professor Steven M. Bellovin has an important post on the privacy issues raised by YouTube’s new House and Senate channels.  He writes [excerpt, our emphasis] that:

“I opened a fresh web browser, with no cookies stored, and went directly to the House site. Just from that page, I ended up with cookies from YouTube, Google, and DoubleClick, another Google subsidiary. Why should Google know which members of Congress I’m interested in? Do they plan to correlate political viewing preferences with, say, searches I do on guns, hybrid cars, religion, privacy, etc.?

The incoming executive branch has made the same mistake: President-Elect Obama’s videos on are also hosted on (among others) YouTube. Nor does the privacy policy say anything at all about 3rd-party cookies.

Video channels providing the public access to members of Congress and the new Administration should be in the forefront of privacy protection-and not serve as a data collection shill for any company.  Nor should one company be permitted to shape broadband video access to federal officials.

Google Lobbying: Why Congress Should Not Use the new YouTube Senate and House Video Hubs

Google is taking a lobbying tactic developed in part by CSPAN years ago–offer members of Congress a free service so they can be seen by the public.  That kind of electronic or digital campaign contribution helps insure that Congress will think twice about biting (or regulating) the video hand that feeds.  Google’s new YouTube Senate and House Hub channels raise a number of concerns and policy questions.

For example, what happens to the user data as people click on the Congressional YouTube channels?  Does Google get to collect, analyze and use such data for its growing political online advertising business?  Beyond privacy, should Congress be endorsing a private for-profit venture as the principal access point voters and constituents need to use?  Does the use of YouTube create a potential conflict of interest for members of Congress who will need to regulate Google–on such things as competition (the DoJ recently described Google as a monopoly); privacy, consumer protection, etc (remember, Google sells all kinds of ads for mortgages, credit cards, junk food, health remedies, etc.).

It’s not a coincidence perhaps that Google’s YouTube congressional channel announcement comes at the same time the company is expanding its online ad business for politics.  As Ad Age reports this week,“The end of an election season usually means dismantling the campaign apparatus until the next cycle. But not at Google; not this year…Rather than packing it all away until 2010, it’s hoping to build a year-round political-advertising business one House seat and hot-button issue at a time.  “There are 500,000 elected officials in the U.S. With the advances we’ve made in geo-targeting, we think this will be part of every political campaign in the country, as well as issue campaigns,” said Peter Greenberger, Google’s director of election and issue advocacy…Google doesn’t yet offer targeting based on congressional districts, but with ZIP code and city targeting, politicians and advocacy groups can cobble together a reasonable approximation of a congressional district.”

The in-coming Obama Administration has had the support of Google’s CEO, and company officials have played a role in the transition.  But the new administration should develop a digital outreach approach to the public which is public–and non-commercial–in nature.  It shouldn’t show any favoritism, even if Google is the leading search and video service.  It should be a a government via dot com.

see: “Election  is Over, but Google Still Chasing Political Spending.”  Michael Learmonth.  Advertising Age.  January 12, 2009.

Google Expanding Video “Metrics” for Brands and Ad Agencies to help “Monetize” YouTube

From the UK’s New Media Age [excerpt]: “Google is the latest company to put its weight behind developing video ad metrics as part of its increased push to monetise its video properties, particularly YouTube.

nma can reveal the search giant is developing a planning tool for video ads to help brands and agencies understand before a campaign launches how effective it will be.

Likewise, it has also completed a project with research and consulting firm OTX that included looking at how to define consumer engagement withYouTube video ads…Additionally, it has ramped up work with its in-house rich-media specialist Tangozebra to develop new ad formats alongside external agencies and clients, while it’s also funding joint research projects with agencies to understand how web users are consuming online video.

The latter will focus on developing ad metrics for agencies and brands to better understand the impact of online video and rich-media ads, on top of analytics already provided by Google Insight. Jonathan Gillespie, Google head of media solutions and YouTube in the UK, said the research has a particular leaning towards planning tools.

“The whole point of doing this research is to fill a gap in our requirements,” he said. “The internet as a whole has been very good at delivering metrics after the effect. However, the front end and planning are things the internet hasn’t been particularly brilliant at.

“Therefore we’re developing a planning tool that will determine how we can best target audiences for advertisers on video while maintaining a good consumer experience,” Gillespie added.

source: “Google develops video ad planning tool to give insight.” Will Cooper. NMA. Nov. 6, 2008 [sub. required].

Memo to Obama Administration: Time for a “Public Media Corps” [or the WPA Meets the Digital Age]

As the nation faces a severe economic crisis, new jobs–especially for youth– must come from the public sector. We should take this opportunity to create a federally-funded “public media corps.” Its mission would be to revitalize public television, helping it become more relevant for the 21st Century. We have a generation of youth (and many others) adept at using new media, who can create social networks, mobile applications, online video and more. There is a vastly under-utilized system of broadcast stations which can serve as production and distribution hubs for new programming. The public media corps would be tasked to engage in investigative reporting and news production; create new forms of cultural programming that reflect the country’s diversity (something public TV desperately requires, by the way); help develop a new approach to public media communications (in such areas as mobile content and social networks).

As the Obama Administration considers its policy for public broadcasting, it should recognize the system is in deep crisis. There’s been an absence of leadership and vision coming from CPB and PBS [I will let others address NPR, which is much more vital than its TV kin; although they too should be part of the public media corps]. We can use this unfortunate financial melt-down to both re-envision public television and help develop a new generation of digital media advocates, journalists, and creators. At a time when traditional news institutions are in their own crisis, the country needs a way to better see itself. A public media corps could provide numerous digital mirrors–so we could see our mistakes, flaws, and the many positive qualities that can help with the painful transition ahead.

Google’s YouTube– New Sponsored Search for Advertisers

The world’s most powerful search engine and online ad company has introduced a new feature on YouTube. Here’s an excerpt from the AP story: “… YouTube is letting advertisers promote their commercial clips alongside the search results at the Internet’s most popular video site… advertisers can now tie their commercials to specific words entered into YouTube’s search box…Some clips that might not rank high in the primary results of a YouTube search theoretically could appear on the first page as a “sponsored” video if a bidder is willing to pay a high enough price for a click and offers compelling content.”

source: YouTube channels Google with search-driven ads. Michael Liedtke. AP. November 12, 2008.