Online behavioral marketing involves tracking the online activities of consumers to allow businesses to deliver advertisements that are most in line with their interests. This is done by using cookies, which contain a small text file with a unique ID tag. The website saves a file with a matching ID tag. Cookies can be used to monitor visits to websites, track the number of times you visited the site, how long you did so for, your log-in information etc. For e.g., if you registered on a travel website for travel to say France and then visited a hotels website, the website may automatically display advertisements of hotels in France. Besides cookies, businesses are using web-bugs to check if a user has viewed a page or an e-mail. Direct marketing techniques like surveys asking the user if the account information could be used for future transactions are also not not uncommon. Signing up for internet services, e-mail, browsing, instant messaging, personal websites, blogs, financial accounts and bill payments are some of the ways in which consumers make themselves vulnerable and their personal information susceptible to being used by online customer information trackers.
With tracking technologies being used my most websites, it is rather difficult to regulate who can use what technologies and have access to what kind of information. While software like ParetoLogic Privacy Control can be used to erase all data related to internet activity, what is more important is consumer awareness. There are several precautionary measures that one can use to protect one's online privacy. These include:
- Not revealing personal information
- Turning on cookie notices in the Web Browser
- Using pseudonyms for e-mail
- Using a secure (encrypted) internet connection
- Examining privacy policies and seals
- Not replying to spammers
- Being cautious of websites that offer rewards in exchange for personal details
Companies like Google argue that the collection of highly focussed information helps them to deliver personalized advertising, but the Federal Trade Commission recently advocated a plan that would let consumers choose whether they want their internet browsing activities to be monitored. With several websites tracking users and selling their information without their knowledge, it is evident that self-regulation has not worked well. As discussed in the New York Times article titled 'F.T.C. Backs Plan to Honor Privacy of Online Users', the commission has proposed using a "do not track" mechanism that gives consumers control over whether or not they would want their browsing information to be tracked. In the pipeline for the next 2 months are decisions regarding whether or not the mechanism should allow consumers to control the type of advertisements they would like to see.
Several corporations like Time Warner Cable and GroupM Interaction have voiced their concerns against this stating that it will hinder job creation within the advertising industry and hinder the existence of websites that rely primarily on advertising revenues. On the other hand, the Consumer Federation of America advocates that it is justified to protect consumer privacy.
The proposals that have emerged from recent discussions by the FTC are yet to be put into action and only once they are in operation can one predict their success or failure. The implications for businesses of these legislations being implemented will certainly be critical and how the advertising industry survives or circumvents these will be interesting to observe.
