How the "Do Not Track" Plan Hurts Consumers, Businesses, and the Potential for Economic Growth

The Debate"The Debate" is a column focused on the current debate around ad targeting and consumer privacy.

Today's article is written by Russell Glass, CEO, Bizo.

This article is about the importance of transparency. In that vein, let me start out by saying that I am the CEO of a company that specializes in business audience targeting online. But before you stop reading and think this is a plea from a vendor in the space, I want you to know that I’m writing this as both a business professional AND a consumer. I have been a steadfast proponent of accountability, transparency and privacy in the online world, frequently writing and speaking about the positive ramifications of both self and government regulation in this field.   So I hope to bring some credibility and a grounded perspective to the table when I argue that the FTC’s recommendation that the industry put in place a "Do Not Track" system has us heading down the wrong path.   The problems with the recommendation which was included in the recent FTC report on internet privacy are varied but my primary issues with it are that it will:

  1. Stifle the innovation and growth in our country in an area where we must continue to lead -internet technologies.
  2. Harm the consumer experience online.
  3. Cause the very same lack of transparency by the government that they’re attempting to quench.

But, let’s take a step back and look at the "Do Not Track" concept.  The idea is simple on the face of it – put a “Do Not Track” capability in browsers whereby users can “opt-out” of being tracked for advertising purposes online.  Some speculate that this latest effort would be very similar to the successful “Do Not Call” list that 180 million U.S. consumers have opted into since its implementation almost a decade ago.  Although similar in name, the two concepts are actually significantly different.  The online equivalent of the disruptive nature of a phone call would be a marketer being able to navigate the user’s browser away from the site they are currently looking at and put a new site in front of them without their permission – a website that the user was forced to respond to in some way.  In other words, it is the annoying and frustrating “nested pop-up ad” of the Internet world that an online fix equivalent to the “Do Not Call” would prevent.  Of course, because of their annoyance to users, pop-ups have long been relegated to the scrap heap without the need for a “Do Not Call”-like capability for all but porn sites.

Tracking in an online world is very different, and actually benefits both users and businesses in a number of ways.  Restated, a “Do Not Track” capability would hurt everyone involved.  This capability would prevent sites from showing the most relevant products and creating the best experience for a user online.  It would be the equivalent of putting special glasses on grocery shoppers where they saw only higher standard prices instead of the discounted ones for their favorite products that those without glasses were able to see.  This is Orwellian stuff.

Let’s go to another example.  Everybody knows how annoying the experience is when you call an airline and the automated response system asks “what is your flight number please?”

  • Customer: “I don’t know.”
  • Automated phone system: “OK, please tell us the destination city using verbal commands or typing, using the letters on your numeric keypad.”
  • Customer: “SFO.”
  • Automated phone system: “OK, SSO. Please tell us the arrival city.”
  • Customer: “No, S... F... O...”
  • Automated phone system: “I’m sorry. We couldn’t understand your last request.”
  • Customer: “SFO!!!!”
  • Automated phone system: “I’m sorry. We couldn’t understand your last request.”
  • Customer: “OPERATOR!”
  • Automated phone system: “Would you like to talk to a Representative?”
  • Customer: “Yes.”
  • Automated phone system: “Please tell us if you are calling about Domestic, International, or Mileage travel.”
  • Customer: “Domestic.”
  • Automated phone system: “OK, please hold, and the next available Representative be with you. Your approximate wait time is...  twelve... minutes.”  “Would you like to take a short survey while you wait?”

The reason for this horrendous experience is that the airline doesn’t personalize the call with any knowledge of the user. This scenario not only leads to a frustrating experience for the customer, but also wasted efficiency for the company -- they have no idea who you are and thus force you to go through a painful experience to help them route you to the right place.  As a consumer, you will respond by avoiding the need to do any future business with the company. The Web today is a lot like this experience. When sites lack any knowledge about a user’s needs, they are largely "dumb" to you and your needs, and you are forced to navigate around an uncommon set of user interfaces, images, search boxes, and the like to get to where you need to go.  This is one of the reasons that Google has been so successful – they’ve helped average consumers find what they’re looking for.  And it’s clearly a massive need.

However, now American Airlines has a new feature in which the company can remember me when I call based on my caller-id.  The experience now goes something like this:

  • Automated phone system: “Hello Mr. Glass, are you calling about your flight from JFK to SFO?”
  • Me: “Yes.”
  • Automated phone system: “OK, a representative will be right with you.”

The difference in the experience for me is incredible, and without realizing it, this is what many of the best sites and advertisers are already doing on the Web.  Amazon.com is a phenomenal example of the power of this kind of personalization.  When I go to Amazon, my experience is completely different from anyone else’s on the site, and in turn, I almost always either see what I’m looking for on the front page, or have valuable suggestions for new products and books that I’d be interested in.

The entire Web should be personalized like AA’s call center and Amazon.com.  This will help companies service more customers and service them better, and will help them increase the efficiency of their marketing dollars so they can grow faster and continue to increase the number of available jobs.   Of course privacy is a must and needs to be built into the system, and it should be creating a completely transparent and enforceable safety net for the consumer.  The industry is taking steps to ensure that this happens, with a consortium of organizations including the NAI, IAB, AAAA, the Better Business Bureau, Better Advertising, and others joining the drive to online accountability, including a newly announced Open Data Partnership between eight of the prominent data and tracking firms online.  The FTC would be well served to let this play out without implementing a "Do Not Track," because these self-regulation bodies will accomplish the goals needed to make the online world safe from a privacy perspective, while creating true transparency for the consumer.

And this is where "Do Not Track" really falls down – it doesn’t come with transparency to allow consumers to make educated choices.  If the "Do Not Track" is implemented, will it come with a warning to consumers that their Web experience will continue to look like the airline example described above when it’s turned on?  Will it come with transparency that they will lose out on the 40% discount to their favorite retailer because they had no way to notify them that they were holding a one-day-only sale for friends and family?    Will it come with a notice that their newspaper of choice will be charging them $15.00 per month for content now because enough people have implemented “Do Not Track” that the economics of their business have changed significantly?   Will it come with the full transparency that they will not always see the real prices for consumers who have shopped at a certain retailer in the past?  The answer to all of these questions, and dozens more are clearly NO.  I would be for a "Do Not Track" that listed all of the harms to consumer experience and commerce, but that would be an almost impossible task.  So the transparency that the government is seeking and the industry is working hard to create is actually being thrown out with the bathwater, and consumers will get hurt because of it.

A "Do Not Track" will do nothing to add to consumer transparency - it will actually harm it.  If the government watchdogs really want to get involved, and doesn’t believe that the industry can self- regulate, they should codify the industry’s self-regulatory principles in order to create an enforcement mechanism that they’re comfortable with.  However, they need to be very careful that they don’t harm the innovation of the Web and consumers at the same time.

11 Comments

  1. I continue to be confused about this whole debate. Don't we already have a do not track option in the form of blocking cookies? Users can already make themselves untraceable with the click of a button (yes flash cookie's can get around this, but there will also be ways of getting around do not track).

    It seems to me that this debate is really about the government forcing people to make themselves untraceable by default. If a do not track feature is integrated into a browser and users are able to activate it, I expect the same small minority that currently block cookies will use it. I personally have no problem with giving people any and all options they may want control their interaction with the internet. On the other hand, if the government forces browser makers to activate do not track as the default, then this is really about government choosing how people should interact with the Internet rather then empowering people to make their own choices.

    Can one of the anti-tracking folks out there please explain to me how a do not track feature on the browser will work differently then the currently available option of blocking cookies?

    Reply
  2. Russell - I think you're missing several important points about privacy / targeting.

    First - false positives. I don't know which, but some ad network somewhere has decided I'm dutch. Maybe I logged in from Amsterdam on a business trip or was looking at a dutch website. Not sure. But now I see all these ads written in dutch everywhere I go. Where can I disown my dutchness? No idea. Purging all my cookies solves it, but disrupts all my other sites. Either way, someone, somewhere has decided I'm Dutch, and they won't stop treating me as such. What if they'd decided I'm fat, or have an STD, or am extremely wealthy? I need a place to view the data people have on me, and dispute inaccuracies.

    Second - Some targeting will eventually emerge that consumers find unfair. Retailers will eventually use targeting for fine-grained price discrimination and promotions: Students will get the cheap coupons and discounts, executives will see the expensive, no-discount prices. If some data provider somewhere decides that I'm a rich executive, suddenly all my online shopping has gotten much more expensive. It's not fair for me to be typecast in this way, and tracking enables that.

    Third - consumers don't know who these tracking companies are nor what they know. It's easy to let one's imagination run wild about who's watching you. Can the ad companies see what I'm typing? Are they reading my mail? How did they know my age and gender? Only a tiny fragment of the consumer sector is going to understand what feasibly can and can't be tracked, and the rest are going to get paranoid.

    All of this means that efforts like the ODP need to get much more traction, and be very consumer-friendly, and fast. Consumers need to see what the ad targeters know and what they don't, and the ad targeters need to do a much better job of defining what's ethically off-limits. And of course, they need to explain more clearly why paying a small price in privacy yields great rewards in functionality -- so they can make the trade-off decisions themselves, with precision.

    Reply
    • Russ: Nice job of connecting the conversation with everyday situations that people can grasp.

      Brian: I generally agree with your comments. However, although I understand your point regarding "Dutchness", the advertiser's perspective on this is simple -- If you don't respond to the Dutch-language ads, at some point the advertisers (especially direct response advertisers) will scale back their impressions to you because they're not productive. If we assume that advertisers are using data to target and to measure/optimize performance, there is no need for you to manually adjust your profile.

      Reply
      • Kevin - I might agree if I hadn't been dutch for six months now. Stereotypes die hard I suppose.

        I guess I'm a victim of ad targeting racism?

  3. As an addendum to my comment above, I think the best way to help consumers understand the value of targeting is with a generic vs. personalized toggle button. Every site / ad net should have a button that toggles the personalized experience on or off, so that consumers can quickly grasp how targeting is affecting their experience.

    Reply
  4. brian, thanks -- i completely agree. as i discuss, complete transparency and the ability for consumers to manage their data is paramount. the "do not track" concept is not.

    zach, as usual, you're on the money -- the recommended FTC approach represents a nice marketing pitch, but overall a lack of understanding by the government on how this all actually works.

    Reply
  5. Great post, Russ.

    I think much of this debate stems from the misunderstanding on the part of government and naive consumers that web visitors have some sort of "right" to privacy. There is no such thing. Now, do we have the right to have our personally identifiable information protected from abuse? Of course. But current laws already protect that.

    I've read the Privacy Policy on hundreds of web sites and none of them says that as a visitor I have the right to remain invisible. If nothing else, sites need to use some sort of analytics to count visitors and page views. So no visitor can be completely invisible, or web sites wouldn't be able to operate. (How much traffic did we get last month, Joe? I'm not sure, all the visitors were untrackable!)

    In exchange for free stock quotes, free weather, free e-mail, free news stories, I give the publisher permission to use some limited information about me. That's part of the deal. My geolocation, browser type, visit length and frequency are *not* private information. Neither is the fact that I read lots of stories about fishing. If people want to opt out of those great services, they can do that by accessing only subscription sites that charge for content. No more gmail, no my.yahoo, no weather.com, no adexchanger. 🙂 My guess is that if visitors truly understood the tradeoff, almost no one would opt for "Do Not Track."

    Reply
  6. How has television been able to cope for all these years without instant feedback? How about radio? My radio doesn't send back information about what I'm listening to. Neither does my TV.

    Thanks but I'll keep adblock installed. If some of my favorite free sites disappear - C'est la vie. The ones I want to survive I do already pay for.

    Reply
  7. Scott, the difference is relevance. Because radio & tv are less targeted you end up seeing and hearing more ads, because they're of less value to the advertiser. Its the reason Hulu can show one advertisement per half hour, as the traffic is more targeted, engaged, and actionable. I'd much rather see fewer ads that are actually things I might respond to, than a whole bunch of random and irrelevant untargeted ads. Furthermore, by allowing my non-personally identifiable traits to be cookied and targeted, I hopefully don't have to pay out of pocket for quality content - as online ads will remain a sustainable business model. The alternative universe are ads with little value, and so content sources are squeezed on quality, and sites are widdled down to a precious few (not necessarily the best) that can survive through subscription models.

    Reply

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