Digital Media Buzz > Tag, You’re It: RFID Technology Grows Up

Tag, You’re It: RFID Technology Grows Up

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What consumers think
A study by the privacy group Truste earlier this year showed some interesting data:

• 68% know that a third-party may track their surfing habits for advertising purposes;
• 43% know the term “behavioral targeting;”
• 64% would choose to only see online ads from stores and brands they know and trust;
• 84% say that less than 25% of the ads they see online are relevant to them;
• Three quarters say they know how to protect their personal info;
• 39% admit they don’t regularly take steps to protect their privacy;
• 50.5% say they’re uncomfortable with ads being delivered based on their surfing history, even when they can’t be personally identified. But this is a drop from eTrust’s 2008 survey, in which 57% said they were uncomfortable with the tracking; and
• 30.6% said they would be comfortable having their browsing behavior captured by websites on which they’ve registered to improve user experience.

“As a whole,” the study said, “consumer discomfort with tracking has declined by 6 percent points year over year. This suggests that although consumers worry about protecting their private information online, they’re getting used to behavioral targeting.
The study concludes that consumers are annoyed by irrelevant advertising, and many would sign up anonymously, or even personally, to receive ads of interest to them. (Survey report on consumer attitudes on behavioral targeting available by email.)

Permission-based advertising
So while industry representatives are concerned that given the choice, users will refuse permission en masse to be tracked with cookies, there are examples showing that under the right circumstances, users might agree.

In mobile advertising, for example, users have more control over how they are targeted. Click-through rates are much higher on mobile advertising, for example, because in general, consumers have taken affirmative action to enter into some type of relationship with the advertiser, through a download, a giveaway, etc.

The increased personalization of the Internet experience brought about by Web 2.0 also may be driving some of the decreased concern about privacy, and a greater willingness to trust companies that are up-front about what they want to do and why. Users of social media, by definition, are predisposed to share personal information in return for a customized experience. Social media sites, such as Facebook, MySpace and Twitter, have data on hundreds of millions of account-holders. Personally customized sites, such as iGoogle and Feedly, track and feed data at the customer’s whim.

In a permission-based system, the marketer has a chance to collect more personal and accurate data about the user. And behavioral tracking via cookies has weaknesses. A significant number of consumers responding to the eTrust survey say they use cookie blockers or flush their cookies several times a month. This throws off the stats, producing many phantom users, with inaccurate profiles.

Creeping outside the social silo
With third-party behavioral tracking under scrutiny, data gathered internally on first-party sites is especially precious. Nowhere is this more true than on Facebook. In 2007, Google and Microsoft dueled for a share of the booming social media site, not only to get a piece of Web 2.0’s Ground Zero, but also to claim a bit of turf in Facebook’s gold mine of member data.

While Facebook has committed a couple of major gaffes, such as the ill-executed Beacon project, and hasn’t perfected its advertising system, consider what it has to work with. Facebook is a place where members mix with friends and people of similar interests and relationships. It’s a site that’s passed up MySpace, and has members more heavily weighted toward an older demographic in the prime of its income. And every keystroke on Facebook, from status updates to your pal’s Wall postings and feeds, are fair game for the site’s targeted advertising team.

Using this information, Facebook can offer ads targeted by location, age, sex, keywords, education, workplace, relationship status, relationship interests and languages.

And Facebook is now moving beyond its walls with Facebook Connect and Openstream, applications that allow outside sites to create portals into and from Facebook’s system.

The premise of Facebook Connect is simple. As an alternative to forcing users to register for yet another web service — a growing frustration for socially active web users — outside sites can allow prospective members to just log in with their existing Facebook account. While this is of benefit to both the user and the outside website, which tap into Facebook’s membership, it also means that the user keeps one foot in the Facebook system, and opens a window into their outside sites of interests.

Openstream opens the constant feeds of user information — updates, photos, Wall posts, etc. — for use in applications on the desktop, or outside sites. And of key importance, according to Facebook execs interviewed in Wired’s article ”The Great Wall of Facebook: The Social Network’s Plan to Dominate the Internet — and Keep Google Out,” this allows the creation of personal, identifiable behavior profiles for ad delivery — not only on Facebook, but across the web. And with Microsoft and its new search engine now linked with Facebook, such ads could evolve into a serious threat for Google’s search cash cow — search advertising with deeply personal targeting.

Google, which was spurned by Facebook, has launched its own multi-login tool called Friend Connect, which can be used to allow members of many other major services, such as AIM to log into multiple sites. And it’s also rolled out Google Profile, which allows the creation and sharing of a public profile, rather like Facebook, but without friends. Google is also sniffing around Twitter, the current darling of trend-watchers, and one with its own feeds and relationship groups. Twitter already has rejected a buyout offer from Facebook.

As a first-party search site, Google stores a considerable amount of search history about its account holders. A person not logged into a Google account, gets a different search result from a person logged in. Google even offers your search history as a useful feature (or a scary one, depending on your point of view). A stroll through your all-time search statistics, top search topics and most-clicked items can be surprising. And if you add Google’s growing suite of products, from Gmail and Google Docs to YouTube and Latitude, the cumulative amount of first-party behavior history is staggering. Adding Google Profile makes it personal.

Even Phorm, whose deep packet-sniffing profiling has become the Boogeyman for privacy activists, is offering a suite of services to those who agree to participate. Those who set Phorm’s Webwise Discover as their homepage will see a dynamically updated page with news and other content based on their interests. And on websites participating in Phorm’s ad network — in much the same way a site participates in Google AdSense — Phorm participants will see a widget containing links to site content relevant to their interests. And Phorm also provides anti-phishing protection to its participants.

The British company has gone to great lengths to create a system it says anonymizes surfers. Furthermore, it provides the ability to segregate those who opt-in from those who opt out, following the surfing of only those who opt in via a “white list.” The question of the default setting — opt-in or opt-out — is still under consideration by participating ISPs, such as British Telecom. Despite heavy criticism by such luminaries as Berners-Lee, the British government has ruled that Phorm’s system does not violate regulations as long as users opt in to the program. The European Union, which strongly disagrees, is threatening to sue the British government.

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