Industry groups introduce behavioral targeting best practices

A group of marketing associations introduced seven best practices principles for behavioral targeting on July 2. The principles – a significant step in the behavorial targeting and privacy debate – are designed to make behavioral targeting more transparent to consumers and to educate consumers on the practices of online advertising and how behavioral data is used.

The groups, which included Direct Marking Association (DMA), the Internet Advertising Bureau
(IAB), American Association of Advertising Agencies (4A’s), the
Association of National Advertisers (ANA) and the Council of Better
Business Bureaus (BBB), expect these principles to be in full execution across the industry by the beginning of 2010. The collaboration was a move by the industry to attempt self regulation in the face of pending legislation.

The associations were joined by representatives from the entire advertising ecosystem, including advertisers, ad agencies, ISPs, Web publishers, search engines, ad networks and software providers. AOL, Disney, Facebook, Google and Verizon were among the participants.

“This effort is coming from across the industry,” said Stu Ingis, a partner at the Venable law firm and a lawyer for the trade groups. “And it gives consumers more control and it creates a strong new accountability for companies to the industry.”

The FTC has responded positively to the new guidelines. “Consumers deserve transparency regarding the collection and use of their data for behavioral advertising purposes. I am gratified that a group of influential associations – representing a significant component of the Internet community – has responded to so many of the privacy concerns raised by my colleagues and myself,” said Pamela Jones Harbour, FTC commissioner in a statement.

The principles are comprised of seven best practices. The first three, the Education Principle, the Transparency Principle and the Consumer Control Principle, call for more transparency about when behavioral advertising is at work and an educational fact page that explains how behavioral targeting works. It also focuses on giving consumers the control to opt-out of targeting.

“The issue of transparency and consumer control and choice is very important,” said Linda Woolley EVP, government affairs at the DMA. “When a third party ad appears on a Web site, there should be an icon or word somewhere near that ad, that a consumer can click on and then in one click, they can exercise choice.” The exact icon or word is still being determined. Once it is chosen, the industry will educate the public about it.

Three other principles include the Data Security Principle, the Material Changes Principle and the Sensitive Data Principle, which all address best practices concerning consumer data.

The final best practice is the Accountability Principle, which calls for the “development of programs to further advance these principles, including programs to monitor and report instances of uncorrected non-compliance with these principles to appropriate government agencies.” Woolley said that the DMA plans to evolve these principles into practice guidelines to make it easier for the industry to adopt.

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