Commentary

Marketing Measurement And Consumer Privacy

Marketers can derive actionable insight by tracking customer journeys to conversion, both online and offline. But that doesn’t mean they need to violate consumer privacy in the process.

While the dos and don’ts of user tracking continue to evolve, it’s important to understand what these rules are designed to protect. Personally identifiable information (PII) is the data that would be enough to identify an individual. It includes information such as name, location, email address, financial information, employment history, health records and more. User behavior data, on the other hand, is information about which websites a user has visited, how much time was spent on each site, what products were purchased, etc. Privacy advocates worry that PII, and user behavior data with PII, may be misused, unlawfully sold, or otherwise fall into the wrong hands.

In an effort to alleviate these concerns, legislators throughout the U.S. have enacted laws designed to protect Internet users’ privacy. For instance, the CAN-SPAM Act of 2003 requires all email campaigns to have a visible and easy to use “unsubscribe” link so individuals can opt out of receiving emails. More recently, “Do Not Track” legislation has been proposed to give Internet users the right to prevent advertisers from tracking their online activities. Other laws designed to protect children, like the Children’s Online Privacy Protection Act (COPPA), prohibit website owners from collecting PII about children under the age of 13 without their parents’ consent.

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From a marketer’s perspective, data-enabled behavioral targeting techniques are the future. Targeted ads that match an individual’s likes and dislikes – such as displaying footwear ads to individuals who are running enthusiasts – increase the efficiency and effectiveness of an organization’s advertising efforts, while delivering relevant offers and messages to consumers. But improved marketing doesn’t have to mean reduced privacy. How then, can marketers gain the valuable information they need to measure the effectiveness of their marketing efforts while also complying with privacy laws?

The key is ensuring that none of the information collected can be used to identify a specific person, rather than an anonymous profile. Advancements in ad technology now enable marketers to understand the entire customer path to conversion without ever compromising user privacy through the collection of non-personally identifiable information (non-PII). Non-PII includes data such as demographic information (like age, profession or gender) or other anonymous statistical data, such as user IP address and date and time of visit. The collection and use of non-PII ensures efficiency in ad delivery while bringing inherent data security to consumers.

Cookies and pixels tags are the most common technologies used to collect non-PII online and across devices (although some of the limitations posed by cookies have driven organizations like the IAB to explore possible alternatives, such as device fingerprinting and Apple’s Advertising ID. However, methods of fingerprinting that uncover PII are still considered beyond the legal boundary when it comes to user privacy). Cookies, pixel tags and other tracking technologies collect anonymous data about a user’s browsing behaviors in legal and consumer-friendly ways, providing a chronologically ordered list of all the marketing touchpoints experienced by an individual on their path to a conversion. By linking these touchpoints, brands can get a more complete and accurate picture of which digital marketing channels, campaigns and tactics are effective, and where they should allocate future spend to maximize performance – without ever crossing the line on user privacy, since the need for PII is eliminated.

While measuring the impact of online activity on offline purchases (and vice versa) is more complex, this can also be accomplished without compromising user privacy. A proven way to link the two is to match cookie IDs from customers who have “opted in” with customer IDs in an organization’s CRM system. For example, after receiving a direct mail piece, a consumer could be offered a discount in return for going online and entering a unique promotion code.

 By using techniques such as this, offline activities for an individual ID can be linked to the online media and behavioral history associated with the cookies of that same “opted in” individual ID – and without the use of any PII.  For marketers, this means having complete insight into a consumer’s interaction with a brand – from the first touch to the final purchase – across all channels, as well as the ability to make smarter, more informed decisions on where to invest budget to produce the best return.

Growing user privacy concerns are challenging brands to find new ways to measure the effectiveness of their marketing efforts. Fortunately, recent technology advancements allow user behavior to be tracked anonymously and in a truly privacy-compliant way, enabling marketing measurement techniques that many companies are already taking advantage of to dramatically improve their results.

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