The dark side of targeted ads?

Users say they didn’t know Facebook maintains a list of their behavious and traits

| 51% of Facebook users are “not comfortable” with being categorized based on collected data.

Are marketers on borrowed time, as data privacy crackdowns increase? Targeted ads from collected data is commonplace on the web. But how much do users know about the data being collected about their online behaviours and traits? And will disgruntled users start to abandon sites that make money by exploiting their personal data?

Incredible as it may seem, 74 percent of Facebook users said they were not aware that the social media giant collects and stores data concerning their interests and traits – according to a recently published study by Pew Research Centre. Not-so-surprising is that almost half of the users polled indicated that they were “uncomfortable” with Facebook’s practice.

It’s a well known fact that most commercial websites collect and process all kinds of data about their users’ online behaviours and habits. Platforms use this data to enable advertisers to target ads to various segments of the public.

As a result of a growing number of high-profile data breaches in the news, consumers are becoming more aware of personal data is collected and use, often without their notice. However, it is still unclear how many users will choose to opt-out by ceasing to use popular services, such as Facebook, Twitter and Google. Meanwhile, lawmakers in the U.S. and other countries are eagerly watching for the right moment to step in.

On January 16, Senator Marco Rubio introduced a new privacy bill. The American Data Dissemination Act (ADD). The Federal Trade Commission (FTC) is tasked with the job of proposing privacy rules that could be implemented by Congress and made law.

The new regulations would replace existing state laws and create a national framework for privacy. However, the proposed bill does not give the FTC the power to regulate tech giants such as Facebook and Google. What is does do is allow the FTC to create binding rules, in the event that Congress fails to do so within two years.

The dark side of targeted ads?

Impact on marketers using collected data

The ADD is the first major privacy bill to be introduced in the U.S. this year. And Congress will be sifting through other bills as the year progresses, including the Data Care Act, which was recently introduced by 15 Democratic Senators.

It’s difficult to predict which legislation, will have the biggest impact on practices of marketers, prevail, but considering the growing dismay among lawmakers with the way big-name companies are collecting and processing consumer data, it seems likely that big-name marketers will have to prepare for the day when their current activities will be called to account.

Marketers would do well to consider how the emergence of new data privacy laws might impact their marketing methods. After all, data is at the heart of targeted marketing. but as the recent Pew study reveals, most online users are oblivious to the fact that the data they ‘volunteer’ to companies is being used to send them targeted ads. Regulatory authorities and lawmakers alike are well aware of this. So, as new privacy laws loom large, it could be that the heydays of targeted marketing, as we know them, are numbered.

Some marketers might feel sore about these highly probable changes. However, the smart marketers will make sure they are prepared for future changes, by being transparent in their privacy notices, policies and procedures. They will need to decide precisely what data is genuinely useful, and concentrate on ethical methods for obtaining ‘first-party’ data in this connected world.

Interestingly, in 2018 Facebook removed targeting options based on data from third-party partners such as Experian and Axiom. It later removed an additional 5,000 targeting options in order to “prevent misuse”.

Hmm.

Sources and credits: Pew Research Center