• by Laurie Sullivan  @lauriesullivan, September 30, 2009

Society has bought into the idea that young people don't care about privacy in the digital world. But a study released Wednesday by professors at the University of California, Berkeley and the University of Pennsylvania suggests that myth just isn't true.

As marketers continue to argue whether behavioral targeting can support free online content, lower advertising costs and produce higher returns on investment, a larger percentage of Americans are saying "no" from the get-go. Some people don't want tailored content. And that number rises to about two-thirds of the 1,000 adult respondents when you tell them they are being tracked through the Internet, according to Joseph Turow, professor at Annenberg School for Communication, University of Pennsylvania.

"It's a warning sign that we have to be careful about generalizations," Turow says, pointing to public policies fueled by privacy advocates who knock on the doors of Congress and the Federal Trade Commission, asserting that behavioral targeting has gone too far. "For some reason marketers think because young adults grew up with the Internet they don't mind being tracked and targeted with online ads."

But that generalization won't stop technology advancements. The industry is at the "cusp of a revolution," but there's still time to look forward and determine the implications to not treating people with respect when it comes to privacy and protecting information, Turow says.

"When people talk about behavioral targeting they want to know where's the harm -- what's the Chernobyl example,'" he says. "While you can certainly find some examples, part of it has to do with respect for information. The idea that audiences are powerful is a fascinating trope in marketing, but in many ways we're not acting that way."

The study, which refers to "tailored" or targeting ads based on consumer online behavior, did not appeal to 66% of the 1,000 adult Internet respondents. The study's authors hired a survey company to interview the people. The 15- to-20-minute interviews included questions from: "Please tell me whether or not you want the Web sites you visit to give you discounts that are tailored to your interests," to: Would it be OK or not OK if these ads [discounts/news] were tailored for you based on following what you do OFFLINE -- for example, in stores?"

Still, 55% of Americans ages 18 and 24 say no to tailored advertising, 37% say no to tailored discounts, and 54% reject tailored news. By contrast, among Americans age 65 and older the numbers are 82%, 70%, and 68% for ads, discounts, and news.

It depends on how you frame the question, says Dave Harry, Reliable SEO founder. "If you ask 10 people if they want to be tracked and have search engines know everything about them, they will say, 'No,'" he says. "But if you ask them 'Would you like the Internet to get to know them better? Would you like the Internet to give you more relevant information? Would you like more targeted ads?' You will get more people saying, 'Yes.'"

Aside from advertising, Professor Turow believes that in the future people will have an option to receive tailored news and entertainment based on the information companies gather about them. And while interesting possibilities exist for ways to deliver that content, there are just as many "dysfunctional issues" that marketers and advertisers need to consider, he says.

Harry says bringing in the social connection makes it "weird." Open Social, Google's API, can link a person's public social connections, such as Twitter and Digg. It looks for common connections through a learning algorithm. It takes a lot of processing power to compute this information, which has been one of the holdups to deploy the technology, he says.