“Do Not Track” puts online target marketing in jeopardy – or does it?

by Ron Daly

For the past few years, advertisers have been focusing on in-page tracking and targeted marketing based on user preferences and actions. You buy flowers on Valentine’s Day (at least I hope you did, for your sake) and suddenly all your banner ads are flower deals. You sign up for Groupon and all the ads are local business discount ads. It’s a little creepy, right?

Apparently, the Federal Trade Commission has encouraged browser developers to include “do not track” options on the browser to allow people to browse privately. Microsoft’s Internet Explorer, still one of the most used browsers in the marketplace, is going to have a privacy filter in its next iteration. Firefox will have a special header tag additive that makes user behavior untraceable. As of this writing, I haven’t seen anything about Safari or specifics on Chrome, but Google is apparently in talks with Microsoft and Mozilla about these new features.

So how does this affect your financial institution? From the CU Journal:

“Browser privacy tools will likely cause us to seriously reconsider whether we continue to do search advertising,” said Lauren Vance, vice president for strategic development and product delivery at $241-million Christian Financial CU here. “And the ability to understand the effectiveness of our website and the content on it could be jeopardized.”

Microsoft is rejuvenating an old privacy tool in Internet Explorer called InPrivate Filtering, which allows people to block all third-party analysis and advertising platforms as they browse the web. Mozilla and Google are considering similar features.

Are we in big trouble here? Not necessarily.

Where we might hit a snag is if the current legislation about “do not track” goes through – the “Do Not Track” bill. This applies to websites and would require them to honor your decision to browse secretly. Google, the giant of the search industry and one of the originators of “I can see you” marketing, would surely hurt as a result of this. So would the companies that have pioneered redirect links as a way of tracking the movements of every visitor to every page. If everyone had to comply, you would have to respect the wishes of the user and give up the precious targeted marketing data on which so many thrive. I’m not immediately sure how that would affect companies that promote PFM promotions (ads that show up after an item on a statement or OLB account notice).

What might save us is the fact that folks will have to turn on these features for them to work. From CMS Wire:

For example, tracking would be opt-out — meaning that consumers would need to know about Internet tracking, and know how to stop it — to stop tracking. In addition, it leaves it up to the FTC to decide what constitutes “tracking” and what is simply a necessary Internet function, which makes some online marketers nervous.

Meanwhile, the major browser companies are working on implementing “Do Not Track” features into their products, in response to a report from the FTC in December suggesting that they do so — with varying degrees of success. It remains to be seen whether Congress will decide that the industry can police itself — or needs help.

And a much stronger line from PC World’s article, “Why Browser ‘Do Not Track’ Features Won’t Work”:

Wolfgram also pointed out another serious obstacle. “Many behavioral targeting companies are based outside the US–making legislation ineffective. Right now, those within the US must voluntarily comply.” Wolfgram added that solutions which take an all or nothing approach don’t give consumers enough control.

The good news is that the FTC and the major browser vendors are aware that there is a problem and are all actively working on solving it. The bad news is that these initial stabs fall short of the goal, and that it would be better if all parties would agree on a single, standard solution.

So, what you have here is a whole lot of feathers and no chicken. Browser developers are creating opt-out solutions for users and Congress is trying to get in the middle and create standards. The technology solution requires users to control their interactions, which many don’t because they feel like it’s too much hassle, and legislative solutions would hinder business, which Congress hates to do, depending on whose business is being hindered.

The Better Advertising Project, a group of online marketers who make an effort to be forthcoming about targeted marketing with a disclaimer button, put together an interesting report with some surprising figures. Apparently, users liked knowing that they were being targeted by certain companies, and around 46% said they wanted to be targeted online with a majority of those insisting they wanted to know how. You can download the PDF here.

As of right now, “Do Not Track” is a best practice that might hurt your bottom line – if you let it. How can you get around it in the first place?

Part of that is being a good detective. Our company advocates that you should use the member/customer data you have at hand and be smart with how you market. You’re not snooping, their information is at your disposal without the Internet being involved.

Let’s say you want to advertise HELOCs. Why bother sending those messages to anyone but home owners? You know who owns their own home (or you should) – narrow down your list. How about college loans? IRAs? You can lay hands on that info now with no need of further gathering. Highlight products that members don’t already have and market to them about things they might need. Use wisely.

Our email marketing emails have link tracking that can be turned on and off by the content creators. Email marketing might help you pick up some of the slack if DNT legislation or innovation gets stronger. Feel free to learn about it here on our web site.

We’ll certainly be paying attention to these issues as more develops. Keep reading the DMI blog for more info.