Millions of Dollars Held Back From Online Behavioral Advertising Because of Trust Concerns
Despite an acknowledged return on investment, hundreds of millions of dollars are being held back from online behavioral advertising (OBA) over concerns that a lack of consumer trust in the practice could damage brand reputation.
This was a key finding from a recent study of 90 organizations engaged in online marketing conducted by privacy management practices organization Ponemon Institute called "Economic Impact of Privacy on Online Behavioral Advertising."
The study revealed that although 70 percent of companies agreed that behaviorally targeted advertising substantially increases marketing and sales performance, most companies surveyed have limited their online advertising budgets over privacy concerns. In fact, extrapolated results suggest that budgets would be as much as four times higher if not for these concerns.
Noteworthy results from the study include the following:
The study concluded that companies are concerned with the protection of consumer privacy and are sensitive to consumer unease with OBA. As a result, it recommended that advertisers, regulators and privacy advocates work together to better address privacy concerns through improved disclosure models, consumer education, effective consent mechanisms and deployment of enabling technologies.