Straight Talk About 'Do Not Track,' Behavioral Targeting and the FTC's Marketing Intervention

March 30, 2011 By Heather Fletcher

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Freeman: "I think there's been a sort of unspoken, but well-understood belief that there's online behavioral advertising through networks and similar entities, and then there's retargeting. And retargeting has been thought of as being sort of outside the box of what the Federal Trade Commission considers to be regulated activity. And that's just not true. It's conceivable that retargeting in some forms could be outside the box. But, in most cases, the FTC considers retargeting precisely the way it considers online advertising, that is behavioral advertising."

Lehman: "The reality is, even with this current self-reg program that provides these ad choices, most people don't click through. And the people who do, most of them don't opt out. Because, notwithstanding what's been made so sexy and dark and sinister through the press and some of the advocacy groups … it's a pretty mundane thing. I mean, they're computers that are evaluating really basic information at high levels, category-wise, and trying to make these matches. And reputable companies, which [are responsible for] 98 percent of what goes on out there, are taking steps to strike the right balance and not use sensitive information, health information, marketing to children, etc."

Freeman: "Online advertising now is a brand issue. It is a brand issue before it's a legal issue. And by the time it's a legal issue, the brand has typically suffered more than the legal costs necessary to fix it, if it can be fixed."

Freeman: "The Federal Trade Commission wants this issue to be self-regulated. They're growing weary of self-regulation [not] actually getting off the ground and reaching ubiquity, notably with the [Digital Advertising Alliance] icon program. But they also know, and give them credit for this, that it's very difficult to regulate behavioral advertising and get precisely what you want with regulation without causing unintended consequences that regulate beyond what you intended to do. They're very concerned about that."

Freeman on "inferred consent for obvious practices": "All the press was [talking] about 'Do Not Track.' But [inferred consent for obvious practices] is [an issue] to pay attention to, because in the final report, this could be something that does become required. And it is something that companies could get sued for. and it is a very different standard than we operate under now. … The fulcrum here is whether a practice is commonly accepted. If it is commonly accepted, I call that obvious, then no consent is required. … But if a practice is not commonly accepted, if it's not obvious under the circumstances, then the FTC wants you to give consumers a choice—clearly and concisely—before they can do the thing it is you want them to do."

Freeman: "The FTC staff signaled support for a 'Do Not Track' mechanism that's easy to find, that's universal, that's persistent and [that includes] accountability. They said that they're encouraged by those things that the browsers have done so far; they're encouraged by the [Digital Advertising Alliance] program. But they want more universality, they want more convergence and they want it to be easy for consumers to use. And so, according to the FTC, we're not there quite yet."

To hear more of what Freeman, Brookman and Lehman had to say about the FTC's recommendations and how marketers should respond, sign up for the on-demand virtual show for free today.

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