There are efforts underway to regulate online behavioral advertising. Proposals making their way through Congress, the Federal Trade Commission and state capitals would define nearly all data
exchanged through interactive channels as behavioral, and place all of these types of ads under strict regulations, according to IAB President and Chief Executive Officer Randall Rothenberg. "Up to
70% of interactive display advertising will be regulated," he told attendees at the IAB Annual Leadership Meeting 2010 in Carlsbad, Calif., earlier this week.
Under some proposals, all
third-party ad serving would be served up only under explicit consumer opt-in preferences, while others would require all locally targeted online ads to have consumer consent. Rothenberg said the
European Union wants to put tighter restrictions on interactive advertising by making all cookies in the EU opt-in by 2011.
"It's happening because well-organized anti-business and
anti-advertising groups have gotten the ear of regulators and politicians and purposely inflamed fears about our industry," Rothenberg said. "They have targeted the very technologies that underline
our value proposition: The ability to deliver relevant information and entertainment to consumers who want it."
Rothenberg said an anti-advertising advocate often quoted in multiple publications
has asked Congress to investigate "the rapid evolution of rich media" and "measures, such as engagement."
Calling on the industry to support self-regulation and speak out on the benefits of
online advertising, Rothenberg told IAB attendees not to take the ad-supported Internet for granted, and that people in the ad industry have been silent far too long. He pointed to the recent
advertising campaign aimed at informing consumers about privacy and data, and the need to become more active in spreading the word.
About 29 IAB member companies have donated more than 600
million impressions to this campaign, and two dozen companies have contributed in $400,000.
David Moore, 24/7 Real Media founder and IAB board of directors chairman, told MediaPost when you
target an ad it turns from nonsensical garbage to "helpful information." Consumers don't understand targeted ads, and that remains the biggest issue the ad industry faces. "It looks like the industry
collects information covertly," he said, pointing to online targeted ads.
Targeted direct mail or supermarket loyalty cards do not have restrictions on targeting advertisements based on consumer
behavior. Some sell customer lists to third-party companies even if the consumer has indicated they want to keep their information private.
Offline restrictions do not exist. A Do Not Call
list has not done much to stop solicitors from calling consumers at home, Moore said. So, if online must adhere to regulations in the long run, he calls for similar restrictions for offline, too.
"We're not talking about using a consumer's name and address, similar to the way they do offline," he said. "We're just talking about targeting ads based on behavioral patterns. We don't know if
you're a male or a female. The data helps us make inferences based on the sites you visit, but we don't know for sure."
With the amount of data available today, targeting ads to consumers will
only become more precise, Moore said.