Industry unites to defend trust in online advertising

The Internet Advertising Bureau (IAB) has joined forces with key industry players such as Google, AOL and Microsoft to issue good-practice guidelines and launch consumer education for behavioural targeting in a bid to settle the furore over the practice.

The industry response to the controversial practice has been seen as crucial to tackling privacy concerns and bringing credibility to the sector, which will reach $3.8bn in the US by 2011, according to eMarketer.

The IAB has worked with key government departments such as Ofcom and the Department of Business, Enterprise and Regulatory Reform (BERR), privacy watchdog the Information Commissioner’s Office (ICO), trade bodies such as the Institute of Practitioners in Advertising (IPA) and ISBA, and privacy groups to gather support for the initiative.

Ten companies including Yahoo, Phorm and AOL’s Platform-A have committed to three self-regulatory principles. These state companies must clearly inform consumers that data is being collected and used for behavioural targeting, provide a mechanism for them to opt out, and provide clear information about their use of the data. The companies signed up to the principles have just six months to comply with these three commitments.

IAB head of regulatory affairs Nick Stringer, speaking at nma Live: Behavioural Targeting Demystified last Friday, said the guidelines were imperative to ensure the industry avoided outside regulation.

“If we don’t crack the privacy debate now, we’re going to miss great opportunities in the future,” he said. “It’s important to put this in place so we can enjoy all the wonderful benefits of behavioural targeting.”

The IAB will create policies and procedures to manage compliance and handle complaints from consumers. It has launched a consumer-facing website informing people of what behavioural targeting is and how they can decline such advertising from companies.

In September 2009 the site will expand to include a set of steps for consumers to opt out of behavioural targeting completely.

Stringer said the launch of the principles and site were developed to ensure consumer trust. “If this form of advertising is to grow, then it needs consumer trust. We have to demystify behavioural targeting. This industry moves so fast, we have a good opportunity to work with global players and put rules in place and avoid legislation,” he said.

Behavioural targeting was thrust into the spotlight last year with the launch of Phorm, the ISP-based behavioural targeting firm, which was attacked by privacy campaigners.

Stringer said the guidelines weren’t a result of that, although “criticism of the industry doesn’t help”.

Zuzanna Gierlinska, head of Microsoft Media Network, said, “It’s better that regulation comes from within the market rather than from government, which might not be fully aware of how behavioural targeting works.”

Gary Cole, ITV’s online sales director and chair of the AOP’s commercial working group, said the initiative would help clear up any misunderstandings about behavioural targeting and would bring consistency across publishers’ terms and conditions.

A BERR spokeswoman said, “While this form of advertising can benefit advertisers and consumers, brands need to ensure they comply with data protection and privacy laws. It’s important that consumers’ privacy is protected and they’re given sufficient information and opportunity to decide whether to participate.”

Phil Jones, assistant commissioner and director of data protection practice at the ICO, said, “Given the understandable concerns of consumers about the extent to which their online activity is monitored and the importance of consumer trust, a joined-up approach to promoting transparency, choice and education makes good sense.”

Quick facts

– 85% of consumers said they would rather view free content supported by advertising than pay a premium not to see ads

– 50% of internet users would prefer to receive relevant advertising, while 41% said it made no difference source: IAB/Toluna, February 2009

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