Internet Marketing Trying To Police Itself On Privacy Issues

    July 2, 2009

An important element (read: selling point) of Internet marketing is the ability to know more about consumers and their behaviors. Everything can be tracked on the Internet, for the most part, and there is obvious value to marketers and their efforts. The flip side of this ability to track people is the privacy issue and lately the US government has been raising it’s regulatory eyebrows at the online world. In the past this may not have been such big news but with the current administration’s bend toward a ‘name it and claim it’ government style, web advertisers are looking to self police before they draw any more attention from the feds.

Yahoo Tech reports on the efforts of a group of advertising associations that have come together to build a set of rules and regulations that the industry can use to give the consumer the privacy they expect and let marketers keep the freedoms that government intervention would likely hinder.

The centerpiece of these guidelines are the provision of transparency in tracking practices and easier opt-out for consumers. While it is certainly a big question as to how well these guidelines will actually work the hope is that the industry will be less of a focus of the FTC (Federal Trade Commission) and Congress.

These guidelines are coming from trade associations that represent 5,000 companies. The consortium comprises the American Association of Advertising Agencies, Association of National Advertisers, Direct Marketing Association, the Interactive Advertising Bureau and the Better Business Bureau. Their members are some of the nation’s largest companies, including Google Inc., General Electric Co., Microsoft Corp., Coca-Cola Co. and Procter & Gamble Co.

These guidelines include recommendations that companies

  1. Tell consumers more clearly when they’re being tracked
  2. Educate consumers on how Web tracking works
  3. Give consumers an easy way to opt out of being followed
  4. Provide “reasonable” security for the data they collect
  5. Limit how much data they retain
  6. Get consumer approval before making material changes that would erode privacy protections with specific areas such as children’s personal information, financial data and medical records getting more protection.

Anyone caught by this new group will be reported to the federal government. This plan should go into effect in 2010. Sounds reasonable enough but of course there are those who feel that this will not be enough.

Jeff Chester, executive director of the Center for Digital Democracy, said the online ad industry’s promise to regulate itself through the new guidelines is designed to undercut the federal government’s increased interest in overseeing online behavioral advertising.

He fears that the guidelines don’t go far enough and that there needs to be fair rules passed by Congress that ‘online marketing can thrive but consumers have greater control on how the information collected is being used.’

I am sure that the views of Pilgrim readers regarding government intervention in business are all over the map so we’ll ask you the question: Should the industry police itself or should the federal government be involved? What are the pros and cons of both options? Here’s your chance to form your own policy for people to see and show off your position on government’s role in business. Sounds like a fun and light topic to consider while enjoying the holiday weekend, right?