Release 0.9: Disclosure 2.0

You can read a short version of what this is about at Mediapost or even see it, courtesy of Nicholas Givotovsky, on YouTube. Basically, it's a recap/expansion of the comments I gave at the FTC "ehavioral marketing" Town Hall and the talk I plan to give at Defrag tomorrow.

Yesterday the FTC held hearings -- or rather a Town Hall -- on "behavioral targeting," which featured the YouTube video contest I had instigated here on Huffington Post. Berkman Center ended up doing all the work, and the results were satisfying.

But now I want to elaborate on what I said on an earlier panel at the same town hall. First, though, I had to fix the FTC's disclosure about myself in its bio handout, which I repeat here at length below... because it's especially germane to this post. Ironically, the FTC staff had edited my bio to leave out all the companies I'm associated with (perhaps to avoid marketing taint), but they are relevant to anyone who might want to understand my biases.

You can draw your own conclusions. Jeff Chester of the Center for Digital Democracy thinks it shows bias; I would argue that it shows experience!

My experience is that consumers don't read privacy statements...and even when they do, they don't understand them.

So what to do? More and "better" privacy statements haven't done much good. The problems lie at either side of what merchants promise in incomprehensible legalese: On the one side, do they actually deliver on those promises? which is where auditors, whistle-blowers, TRUSTe, law enforcement and the like come in. The FTC already has enforcement and prosecution authority against fraud, and it has cleaned up companies such as Zango and put others such as Direct Revenue out of business (though its principals may rise again...)

The other question, which is my concern, is consumers' understanding of the context in which they are surfing the web. The Cookie Crumbles contest was one small step -- explaining how cookies work, though without much information about what marketers do with them. Next year, I hope Berkman and the FTC will do the contest again, with a suggestion of five minutes instead of two, and a broader scope. Meanwhile, Google has launched a new privacy channel, and it's a free country: Anyone can go ahead right now and make a five-minute or even a ten-minute video explaining the broader context, and with luck users themselves (along with Berkman, Google, bloggers and the press) will help the best of them gain visibility.

But what about the disclosure statements themselves....?

Mirror mirror on the wall

Over the years, marketers have become better and better at collecting data on individuals, recognizing them, classifying them and sending them personalized (you're a segment) and even personal messages (you are member 582930, with 56,784 miles). So why can't they use those same talents and show them personal disclosure statements? For example:

Here's what we know about you:
You have visited these sites.
You entered these search terms.

[Of course, these will be very long lists.]

[So, marketing categories are more interesting and quicker to read.]

Here's what we have concluded about you:
Income range
Propensity to purchase cosmetics online
Favored movie categories
Frequently visited cities
Middle-aged white female, urban
Et cetera

[If they can sell prospect lists to marketers, they can also tell the individuals what lists they fit onto.]

And here are the other sources we have used to learn about you (with links to THEIR disclosure statements):
Axciom
DoubleClick (we are a member of their ad network)

Here are the marketing partners to whom we sell your information:
blah blah...

What's the fairest mirror of them all?

Of course, this won't be simple. Some companies will be better at it than others. And with luck, those who are not so good will borrow ideas (not code or precise layout) from those who are good at it. Many of the terms marketers use are not easy for users to understand.
But that's a challenge, just like the challenge of explaining how aluminium zirconium tetrachlorohydrex GLY reduces your sweat output.

Of course, most users won't read this stuff any more than they read current disclosure statements, but that may change. First of all, if they do look, they will find information that is relevant to them -- the proverbial mirror, which is much more interesting than an abstract word painting full of phrases such as "trusted marketing partners" and "may, at our discretion."

Facebook as nurture

Second, consumers themselves are changing -- not in nature, but through nurture. In particular, Facebook and its ilk are letting individuals learn the habit of describing themselves and spreading their "presence" across the net. They are also learning how to block some of their friends, and how to control which of their friends get to see which parts of their profile. Right now is just the beginning. They will get much better at it -- and Facebook (which is announcing something on Tuesday) will make those tools easier.

If they can control the presentation of and selection from their profiles for their friends, they will find it natural to do so for marketers as well. The marketers need to get ready -- not because of the FTC, I hope, but because of the competition!

My disclosures (and biases)

[This is a partial list of my most relevant affiliations. I was also an informal advisor to TRUSTein its early years.]

I'm a director of and investor in WPP Group, which owns many ad agencies, including 24/7 Real Media, whose Dave Moore was a panelist on Thursday.

Director and investor in Boxbe, which lets users control their own inboxes and share revenue from marketers they let reach them through those inboxes.

Director and investor in eventful.com. Eventful shows ads around events; it also collects e-mail addresses from users and uses them primarily to promote its own services, but it also delivers mail on behalf of advertisers (without disclosing the users' identities to the marketers).

Investor in Linkstorm, not Linkstorms.com, which gives users the ability to see a pop-up menu of choices (instead of a single landing page) when they roll over an ad: Would you like more info about the car, the car company, a dealer near you, or possibly a video about the car's green credentials?

Investor in Zedo, an ad-serving company.

Investor in Dotomi (from the creators of ICQ). Dotomi started out with an innovative, opt-in system that would have delivered personal, by-name messages through ad-banner space by recognizing cookies, but it was too innovative for its time. Now the company does more normal targeted ad-serving and is exploring behavioral targeting.

Investor in AnchorFree, an ad network that works like an ad-supported version of T-mobile hotspots. AnchorFree signs up local venues to offer free WiFi; it sells geographically targeted ads and shares revenues with those local venues. [added Nov. 6]

And finally, I'm an investor in and director of 23andMe, a pre-launch company which is widely rumored to be doing something with consumers and their genomes, and necessarily pays a lot of attention to user data control. I have been helping with the development of our privacy policy and its disclosure, which is a thought-provoking exercise.

I would argue that these companies are exemplary in their use of customer data (and I raise the issue constantly), but we're not there yet in our disclosures. I welcome the challenge of making them better!

Comments

[Mac-A-Roon]

The NAI hosts on "opt out" page where you can reveal reveal active cookies in your browser and opt out of particular behavioral tracking services.

Interesting possibility there: tracking those who choose to opt out.

Studies has asserted that 3-4 people out of 10 delete cookies monthly. One wonders how that skews BT results. At least one company claims to derive accurate profiles based upon two weeks of internet use.

Rather than read privacy statements it can be enlightening to scan the prose of BT providers:

x+1 boasts a Progressive Optimization Engine that “leverages sophisticated mathematical models to make optimal segmentation and targeting decisions for online marketers. POE’s added-value is derived from its ability to make actionable decisions from massive amounts of complex, interacting data. Using a wide variety of data sources, POE profiles end-users and anonymously tracks their online behavior and responsiveness.”

SpecificMEDIA, Inc., whose targeting method “predicts each user’s age and gender based on his or her past online viewing habits… assigns a score related to the likelihood of a purchase in over 3,300 product and service categories… detects each user’s location by IP address and gives advertisers the ability to geographically target down to the zip code level.”

TACODA claims to be “the first and largest behavioral targeting advertising network reaching more than 120 million people across 31 discrete audience segments every month.”

24/7 Real Media Inc. asks, “Would you like to reach single women who own cars and are sports-enthusiasts in Chicago, or maybe Japanese teens that live in the city and buy DVDs?” responding with, “Whoever you want to reach, we have targeting down to a science.”

Acerno is, according to their site, “reaching over 80% of the internet population on a monthly basis,” asserting that “it’s one thing to locate customers who have actually been to your site. It’s quite another to find the ones who are right for your site, but haven’t yet been there. We’re able to discover those customers through our co-op of like-minded businesses.”

[richman0829]

I'm not one of those much concerned with privacy. I've read and appreciate the arguments for transparency in The Transparent Society, by David Brin. But I'm puzzled that, despite having satellite and street-level cameras everywhere, we still don't seem to be able to track the bad guys when they rob a bank or molest a child or even spend time spraying grafitti on a wall. Why is that?

[MinerSam]

As a user who was an adult (who does not suffer from amnesia) during the Nixon and Reagan eras, not to mention the last several years..the constitutionality of the thing is foremost on my mind.

Unless of course I were a Clearance Thomasite or Federalist Society member. Were I such a constitutional fundamentalist privacy would not be an issue or a right in my mind.

The bottom line regarding disclosure is WHAT THE DEFAULT IS.

The ability to Opt In (versus having to op out) is the bottom line for me.

But as it is now, I get emails, every day, for online cosmetic purchasing, when I don't even use cosmetics in the first place.

And when searching online, at times, the service provider provokes a sense that one is being sniffed in the behind by a stinky dog.

Surely this LACK OF RESPECT FOR COMPANIES is not what they are trying to illicit from a potential consumer.

It's not that hard to get people to read disclosures. THERE ARE WAYS TO LEVERAGE IT...not by FORCING them to pretend they read it >>> but by INSPIRIG them to do so.

Axcioum is a Republican company that, like Blackwater...people who confuse Capitalism
with Fascism.

As in any relationship respect for the OTHER is what ultimately works best in the **long run**

Disclosures should BEGIN WITH what is good for the user before going into all the ways the company is protecting itself legally...

We saw the opposite of that in how FEMA operated during Katrina (more concerned about liability than in providing services)...and why they installed, as it's head, the Lawyer of the Republicans who conducted the Clinton impeachment.

[ctuck622]

The Patriot Act really hit home when I attempted to change my mailing address with Bank of America and Capital One VISA when I moved six months ago. I have always used PO Boxes for my mailing addresses, but suddenly both corporations refused to change my mailing address to my new PO Box number, insisting on a street address. I refused, informing both that when I'd been a victim of crime many years ago, law enforcement advised me to never reveal my street address unless absolutely necessary, and I have acted on that advice ever since. I reminded Bank of America that I've had an account for 16 years and as a middle-aged disabled woman, I am no threat to anyone. After much "wailing and gnashing of teeth," Bank of America finally relented and changed my mailing address to my new PO Box.

Capital One VISA, however, never did, and essentially held my VISA statements "hostage," to the point where I finally signed up for online statements.

Absolutely none of the complaints I filed online with the FTC were ever even acknowledged.

Our corrupt government would be much better off if it spent less time chewing off its own tail, cutting off its nose to spite its face, and turning on its own citizens by violating their civil and constitutional rights, denying them health care and violating Federal EEOC & HIPAA laws by illegally delving into the medical histories of job applicants, offering lame excuses not to hire them under the guise of "risk management," and finding reasons to eliminate and terminate good employees because they have what health insurance underwriters consider "excessive" claims and too many "expensive" health problems.

Instead of shredding the lives and careers of unsuspecting, law-abiding Americans, our government needs to look in the mirror and clean its own house. Once that has been accomplished, maybe then the rest of the world will once again respect what was good and great and admirable about the United States of America. That will never happen, however, while America continues to operate as the United Corporations of America.

[OhgReaTone]

Electronic eavesdropping is the latest marketing rage. I wrote a post on 'Old People Exercising" and was bombarded with Viagra internet links. I wrote a post on the Kansas City Chiefs and was quickly linked to by a Kansas City Porno site. Marketing has become a funny business.
Ohg
http://thefireside.wordpress.com/2007/10/18/blogging-ethics/

[RealSoft]

Cookies were bad in affecting your privacy.

Apps like Facebook and MySpace completely destroys any such element of privacy - by having your history on public servers.

Bottom line: Cookies were nothing. Private life is no longer private - It is strewn all over blogs, social networks, gmails, yahoo mails, etc.

[dryfactoidobotanoid]

the obstacle to weaponizing artificial intelligence applied to internet communication, is the difficulty of programming a computer to understand irony.