Online Privacy: Trading Perceptions for Reality

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ADOTAS – Misperceptions cloud reality and blind us from viewing things as they actually are. Whenever you introduce something new, there exists a degree of fear, uncertainty and doubt (FUD). While FUD frequently has no basis in reality, it absolutely impacts reality by causing actions that are based on perceptions rather than fact.

This is certainly the case for consumers and online privacy – particularly in the realms of behavioral advertising and mobile interactions. With the online landscape changing so rapidly, it’s challenging even for those of us involved in the Internet advertising and media industries to keep pace. For consumers, this is even more so.

In our role as the leading online privacy solutions provider, TRUSTe keeps a close eye on consumer perceptions – not only to better understand the areas of consumers concerns but also how to best alleviate them.

Together with Harris Interactive, TRUSTe recently completed two consumer research projects – one relating to issues about online behavioral advertising (OBA) and the other about mobile privacy.

Not surprising was the fact that consumers have concerns about their privacy as it relates to behavioral advertising – with an overwhelming 94% saying that privacy is an “important issue.” But our research also uncovered a few surprising consumer beliefs. Misperceptions can run both ways, and some of these findings might shatter our own industry perceptions about consumer feelings.

Most consumers believe their personal data is being shared without permission.
TRUSTe’s research has found that consumers believe data activities are more privacy invasive than they actually are. According to our OBA consumer poll, more than one in three believes that the websites they visit share their personally identifiable information (PII) with advertisers without their consent. Forty percent of those we surveyed believe, for example, that their name is shared without their consent, whereas in reality, most behavioral advertising operations only know consumers by anonymous cookies – not their names.

Similarly, our mobile privacy research revealed that 56% of consumers are concerned that their personal information is being shared with others without their permission. In the same survey, 68% of respondents said that they believe they are tracked based on their mobile activities for OBA, and 72% think that some mobile applications share their information with third parties. For all three, the reality is actually much less.

The bottom line is that sharing of personal data is a consumer hot button. When asked for their feelings about behavioral advertising when their PII was not involved, for example, consumer favorability increased by an astonishing 100%.

Consumer privacy opinions and privacy actions don’t always synch up.
Despite widespread concerns about the safety of the Internet, the OBA survey revealed that only 37% of consumers know how to protect their privacy online and consistently do so. It also showed that one in four protect their privacy by “opting out,” although the majority (53%) said that they rarely or never manage their privacy choices by opting out of OBA.

In tracking privacy behaviors, however, TRUSTe has found that the actual opt-out rate is much lower. For instance, in a 2010 pilot of TRUSTe’s TRUSTed Ads OBA platform conducted with Publishers Clearing House (PCH) only 1% of site visitors actually chose to opt out of all advertising networks. This shows an interesting discrepancy between consumer privacy opinions and privacy actions.

Yet it’s a mistake to assume that consumers don’t care about privacy just because they don’t opt out. A consumer’s perception about a website or platform definitely affects the way that they interact with it, and better privacy has been found to create more consumer trust, leading to increased interactions and openness.

Our OBA research also shows that terminology impacts consumer feelings. Words “tracking” and “targeting” have a negative impact on consumers, while the term ‘interest-based advertising’ is received much more favorably.

OBA Compliance Makes a Difference to Consumers.

Consumer awareness about the DAA’s Self-Regulatory Program for Behavioral Advertising is growing. As more ad impressions become compliant, TRUSTe expects this awareness to continue. Our research has already shown that 43% of consumers are generally positive toward advertisers who participate in the self-regulatory program.

A new report released by Forrester Research entitled “Online Advertising Data Compliance Matters” encourages marketers to “take charge” of self-regulation for the benefits of their companies’ brands as well as the overall industry. The report supports TRUSTe’s belief that the benefits of participating in the self-regulatory effort for OBA compliance far outweigh the costs.

The report also notes that companies, such as TRUSTe, are already bringing to market many of the privacy solutions that are needed for successful deployment. Finally, Forrester urges brands to take charge of their compliance obligations themselves – and not just simply rely on their ad network vendors. TRUSTe wholeheartedly agrees.

For TRUSTe, all of these findings reinforce the vital need for continued consumer education and transparency about online privacy practices – for both OBA and mobile. Consumer trust and understanding are essential to address concerns and contribute to effective usage of these online solutions.

With clear and concise information about what’s actually being done with consumer data, advertisers, publishers and media platforms can stop misperceptions from growing and begin to reap the benefits of these interactive technologies.

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