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Martin Smith is the vice president of development at TruEffect. Smith’s career in direct and interactive marketing spans more than 23 years; at TruEffect, he focuses on developing new initiatives and forging partnerships that will create value for the company.
Most recently, he led direct marketing efforts at Apple Computer’s Online Store.

Other successes include the development of card/barcode based retail loyalty programs for Clarks Shoes, census-based applied analytics for National Westminster Bank, circulation/merchandise decision-support systems for technology reseller Zones Inc., and global integrated CRM systems for Procter & Gamble.

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Smart Targeting Respects Consumers’ Privacy

Written on
May 16th 2008
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by Martin Smith  |
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transparency_small.jpgADOTAS EXCLUSIVE — Just because you have the capability to do something technically doesn’t mean you should. Or at least perhaps it should be managed in a very defined context. I am beginning to think this way about the raging debate surrounding behavioral targeting.

The angst described in the news around Phorm and a few other companies and how they are using ISP data has reignited various interest groups and stimulated concerns about how consumers could be mistreated, discriminated against or compromised in other ways. Clearly some of the focus has been directed against the protagonists because of their association with ISP’s and the determination of advocates for Open Access to keep the pipes forever “dumb” (so other people can make bank).

I for one believe that the folks delivering the media have as much right to participate in the wealth creation as those who sit on top of it developing increasingly bandwidth-intensive solutions. This time, however, I think they have the wrong model to deliver value and differentiated revenue streams.

Incidentally, you don’t have to wait for your ISP to sign up with one of those companies to see behavioral targeting at work. If you want to see BT in full flower you only need to go to Yahoo and mess about in search and content areas (I am now the recipient of some wonderful Botox promotions as well as cancer treatment, and offers for the now not-so-surprise trip to New Zealand!!) Being an industry practitioner I’m ok with this, but I do expect folks to use their technology judiciously and at least know where the ad serving frequency controls are.

I also believe there should be another way to opt out of targeting other than the simple and blanket NAI opt-out. It’s amazing to me that as creative as we are, what with developing fantastic concepts in search, social and streaming media, we still can’t figure out a better way for consumers to manage their preferences.

Marc Goldstein’s address to the American Association of Advertising Agencies covered this well when he talked about the need for advertisers and agencies to be more mindful of privacy going forward. Sadly as an industry we seem less attentive to consumer privacy given the recent pathetic response to the FTC’s attempts to create a dialogue on the subject.

Of course the FTC could take a more legislative approach. Changes in Germany and Sweden regarding fixed IP have actually pushed responsibility for consumer privacy back to the advertiser by effectively reclassifying clickstream data as personally identifiable and therefore making it subject to privacy law.

Which brings me to my other issue with how these companies are utilizing this technology: Behavioral targeting should not be utilized as a proxy for good standards in publishing. As a friend of mine says, publishing is a virtuous circle — great content attracts a great audience which attracts great advertisers. Maybe a little more focus on this would aid some of the ailing media properties than a salacious use of targeting. When doing client and prospect reviews we see this time and again when a great brand appears in a less than great area because of “Behavioral Targeting.”

There is a place for targeting, but it should be better balanced than it is today.

However, the opportunity for investors and media folks seems too compelling. It’s the Midas touch – trash to treasure, straw to gold – thank you, Mr. Rumpelstiltskin (who, if you remember the rest of the tale, had a take option on the first-born child). As long as we continue to take such unmitigated risks with these relatively crude approaches and continue to treat targeting as a media type then we will come up short in the mind of consumers.



Reader Comments.

The folks delivering the media DO have as much right to participate in the wealth creation.

Its called pricing your communication service according to consumption. Its what the postal services do. Its what the ISPs should do.

They have no right to steal content from content creators as though copyright didn’t apply to them. Simply because it is possible to copy content doesn’t make it fair to copy content.

They have no right to assume that privacy of personal and commercial communications can be disregarded. Their role is providing a private, safe, secure communication system.

They have no basis for assuming that because content isn’t encrypted it is intended for anyone to read.

Posted by Pete | 11:58 am on May 16, 2008.

The phurore over Phorm in the UK is fundamentally about acquiescing in the monetisation of deep packet inspection. It sets a precedent in privacy invasion that, if allowed, threatens to place control of what content is available to the subscriber in the hands of the ISPs and whoever pays them for deep packet access.

If Phorm are allowed this access, for what maybe relatively benign purposes, there will be no rational for denying those with the cash and more covert nefarious intentions.

This has the potential to completely distort the net and reduce it to a TV shopping channel that spy’s in great detail on every subscriber.

This is in no way equivalent to current targeted advertising models.

Posted by Oar Wellin | 6:59 am on May 17, 2008.

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