The internet. Probably the greatest invention of the information age. It is revolutionizing how we do everything. From communication, to shopping, to consuming information, to advertising, to working, and much more. Unfortunately the internet is advancing and changing so much that it can be hard to adapt to. Unfortunately this is leading to some pretty severe growing pains as Governments and agencies, as well as businesses and individuals are all trying to adapt, with varying degrees of success. The biggest problem is the fear that comes with new technologies. Those who do not understand or know how new tools and technologies work are more likely to be wary of them, and those people can hold us back. There are many parts of this that I'm going to touch on, but I want to start with online advertising and how more specifically targeted ads can be the most valuable advertising that there is, and why we should embrace that, not be afraid of it.
I've chosen to talk about advertising first not because it is the obvious first choice, but because it is topical. Canada's privacy commissioner recently ruled that some types of targeted advertising on the internet violate Canada's privacy laws, and needs to change. This to me show just how out of touch our privacy commissioner and privacy laws are with the future of communication and media.
Let me start by talking about old media, or traditional, advertising. I'll mostly be talking about TV advertising, but this still generally applies to other mediums like news print and radio as well.
Traditional advertising has a very simple model. Companies sell a block of advertising, and all viewers watching at that time will see it. That may sound like a great method, but it is actually pretty inefficient. Advertising usually targets only a subset of those people that are watching. For example, an advertisement for Gillette razors may be very relevant to someone like me, a mid 20's male. But a 12 year old girl could be watching at the same time, and that commercial has zero value to her. That means that out of the two of us, the advertisement is only reaching 50% of the audience with the targeted effect.
Now, ratings and demographics play a huge role in traditional advertising. Higher rated TV shows will have more expensive ad spots because there are more people watching them. A show like desperate housewives will have more advertisements targeted towards women, because more women than men watch that show. During Saturday morning cartoons I'm more likely to see ads for toys than I am for R-rated movies. Traditional media depends heavily on ratings and demographic information, because it can try to target the most appropriate ads at the shows that would have the appropriate audience. That's why the male 18-34 and female 18-34 are such sought after viewers among networks. But even with all of the data that they can get, there is still a large part of the audience that will watch an advertisement where it is simply not relevant to them.
Now, lets look at some of the various online advertising models. Google, which makes the vast majority of their money each year through advertising, has the simplest, but easiest to understand model. a company can buy a keyword on Google. When a user does a search that includes that word, that company's advertisement appears in the search results. So if I search for "coke" and the coca-cola company has purchased that keyword, I'll see an ad for coca-cola in my search results. simple, but yet very effective. It means that only people who are searching for something will see that ad. If I don't' search for coke, I'll never see a coca-cola ad. Simple as that. Google uses keyword advertisements in almost all of its products. in Gmail, if an email has a phrase relating to coke, a coke ad will appear on the right hand side of the page. Simple, effective, and un-obtrusive.
Now, our activities can also influence advertisements we receive. I'm going to use Facebook as the example here, as it is again, the most relevant. All of the information a person puts into Facebook, whether it is their relationship status, hometown, interests, favourite movies, etc, allow advertisements to be targeted at them. All of those "like" buttons you see all over the internet now, Facebook collects data on those too. The goal is to provide you with the most targeted and relevant advertisements possible. Did you just change your relationship status to engaged? Well then Facebook will start giving you ads about wedding services. IF you just got engaged and are female, then you are likely to get an ad for wedding dresses. If you seem to "like" a lot of news stories relating to the Ford Motor Company, you will see a Ford ad. Like the Edmonton Oilers, you might see an ad for Oilers merchandise.
These types of ads are hugely valuable to companies, because it allows them to provide ads *only* to people that they would be relevant to. If you are not getting married, there will be no ads for wedding services. If you don't like coke, no coke ads. It allow each ad to be so specifically targeted that it does not have to appeal to anyone except the target demographic. This makes each advertisement more valuable for the both the company selling the ads, as well as the one buying them.
Now, as a consumer, someone looking at ads, I know that I would much rather see an ad that is for something that would actually matter to me. Don't' get me wrong, if I never saw another advertisement again it would be great. But since advertising is part of our lives, I really want to see something that matters. I'd much rather see an ad for razor blades than makeup, for example. And why would a company want to direct a makeup advertisement towards me? It makes no sense for them, just as it makes no sense for me.
Now, there is an argument to be made about privacy. That's a topic I'm going to talk about more later, but my belief is that how these ads are targeted towards me are in ways that are a natural extension of what has been done in the past. Do you honestly thing that if 20 years ago that if companies could have targeted their advertising in this specific manner they wouldn't have? the only reason they didn't was because there was no way of knowing. Now, I'm sure this is true for most people, but I'm not one to hide many of my likes and interests. It is by no means a secret that I like Coke more than Pepsi. I will tell people that without a problem, so why should I care if an advertising company knows that. Sure, that information should be used appropriately, but this is true for any and all information. All the data is used for is to give me a better experience, which is what I want.
What the privacy commissioner has said is that information about how targeted ads work should be clear and visible to users. I have no problem with that, as it is something that should be disclosed. After that, it gets, well, stupid. The privacy commissioner wants websites to stop using tools that users are "unaware of." Honestly, that is shortsighted. There is an argument to be made that if a person "likes" soothing on Facebook that it does actually constitute something that a user actively interacts with, and Facebook has disclosed this. Things like changing a relationship status in Facebook are less obvious, but I would still argue that Facebook does disclose this as well, and a user has to actively put this information into Facebook. IF they do not want that, they don't' have to. When thinking about Google, the privacy commissioner's argument is even more wrong, because it only displays ads directly related to something a user does.
Online tracking of Children is another thing that the privacy commissioner wants stopped. Now, while I can see the argument that a child can't be reasonably expected to understand how all of this works, but what is being asked for is nearly impossible. Using google as an example, if a 12 year old uses Goole to help with school homework, Google has no way at all of knowing who is making the search, just what the search is for. The search could be made by a 12 year old, or a 70 year old, and Google would not know the difference. For other services there are methods to combat at least part of this. For almost all online services users must be 13 years of age to sign up, and have parents permission. Now, admittedly this is probably one of the most broken "rules" in existence, but at least it is there. In an age where companies have very little control over who actually uses their service, it would be impossible to keep one demographic out.
I really do believe that the type of targeted advertising we see on the internet today is the best kind of advertising ever seen. It may seem a little off putting at first to think about an advertisement directed solely at an individual instead of a group of people, but this allows for a much better experience. Just because it is new, does not make it bad for us. I would argue that Google and Facebook have revolutionized advertising in ways that the TV networks could have only dreamed of 20 years ago. Just as technology enables us as users to do more today than ever before, it allows the same thing to companies. They should not be punished for using the tools at their disposal to create the best possible experience for a user simply because our laws are outdated and cannot keep up with said technologies. That type of fear will only hold us back, not move us forward. It doesn't mean that there is no privacy; There are things I choose not to share on the internet. But if I'm willing share it, I want it to be used to give me a better experience. That is why it is there. The future of advertising is here now. In fact, it has been here for a few years. The companies that embrace it, like Google, are doing immensely well. Last time I checked Google was making more money than I can really comprehend through advertising sales. This is not going away, and those that fight it and try to stop it like the Privacy Commissioner's office has will be exposed as outdated as they are, and will be left behind.
[Read] - Privacy Commissioner sets new guidelines for online ads