In the information age, when does information become TMI?

Dear World,

I am a media buyer. I am a media planner. I spend a lot of my clients’ advertising dollars online. And as such, I revel in the opportunity to infringe upon your internet “privacy” to make sure my targeted audience is seeing my ads on an outlet that I believe they will be receptive to. I’m sorry, it’s the way the business goes. That said, as someone who’s spent the last several years of my life examining and experimenting with various forms of online advertising and targeting, I find myself torn on the level of transparency in advertising.

Below is an article published recently in AdAge discussing a new ad unit, the Power Eye.

NEW YORK (AdAge.com) — Starting this week, AT&T, American Express, Microsoft and dozens of other major marketers will pull the veil off their web ads and show consumers what’s inside.

It’s the first trial of what some hope will become the online ad industry’s long-promised self-policing system designed to stave off the growing forces for regulation in Washington, as well as give consumers more control over how they are targeted by advertisers.

The system, deployed by a start-up called Better Advertising, will place an icon in the upper right-hand corner of the ads that looks like a cross between an eye and power button called the ”power eye.” Consumers who mouse over the icon will get a view of all the data that was used to target the ad, as well as the option to opt-out of future targeting by those companies.

The system is one of several competing to get the endorsement of a coalition of organizations representing the ad industry, as well as the Council of Better Business Bureaus, which has been tasked by the industry and regulators to come up with a system of disclosure for consumers. Several online ad vendors also have proposals before the organization, but executives close to the process say Better Advertising, founded by former About.com chief Scott Meyer, is close to winning the deal.

Better Advertising’s system has been endorsed by units of all the major ad holding companies, WPP, Havas, Publicis Groupe, Omnicom Group and Interpublic Group of Cos. Those rolling out the system this week include Interpublic’s audience-buying platform Cadreon, Publicis’ Vivaki and WPP’s MEC Interaction.

“Ultimately the data belongs to the consumer — we are being allowed to use it,” said John Montgomery, chief operating officer of Group M Interaction, the digital-buying unit of ad giant WPP. “If the consumer is uncomfortable, then they will not allow it to be used that way.”

Opting out
Many of the largest web publishers such as Yahoo and Google, data providers like BlueKai, and ad networks like Audience Science currently allow consumers to opt out of targeting. But those require consumers to continually opt out on many sites and the industry has been seeking a solution to allow consumers to opt out of the ad itself, wherever they happen to encounter it on the web.

“This is the first to provide consumer notice and a compliance service that is independent and works across platform,” Mr. Meyer said.

Part of that is a subtle PR effort for online advertisers: the term “behavioral targeting,” in use since late last decade, is getting a makeover as the softer, gentler “interest-based” advertising, terminology they hope will sound less sinister.

The system will also provide advertises with a new kind of feedback mechanism from consumers. While today they measure effectiveness of ads by the rate at which people click or interact with them, soon they will also get data on how many people found the ad objectionable enough that they decided to opt out of the targeting behind it.

Consumers won’t be able to opt out of the ads, mind you, just the targeting. But the opt-out will give marketers a new view into how their ads — and their brands — are perceived. The prevailing hypothesis is that greater transparency will lead to greater trust among consumers. But even the most enthusiastic supporters of the project also see risk.

“If people start to opt out it makes our targeting less effective and it becomes more challenging to sell to people,” said Steve Governale, executive director-digital marketing at AT&T. “But, long-term, transparency can only do us good.”

Behavioral data
Mr. Governale said the icon would apply to AT&T’s ads selling products such as mobile phones, where third-party behavioral data is used. AT&T’s brand ads — “more bars in more places,” for example — don’t generally use behavioral data.

The self-regulatory system will only apply to ads that use data from third parties; a brand ad aimed generally at readers of a website won’t apply, nor will it apply to publishers using their own data.

About 12% to 15% of online-display dollars go to ads that employ third-party targeting data, according to Kantar Media, and a recent Ponemon Institute survey of 90 marketers said they’re spending 75% less than they would on targeted ads due to privacy concerns.

Execs say the brands themselves have been the silent hand pushing the issue, part out of fear of regulation and in part to forge more authentic connections with consumers. “It’s definitely something that will differentiate us from the folks not doing it,” said Brendan Moorcroft, CEO of Cadreon.

Backed into a corner, the online ad industry doesn’t have much of a choice. A privacy bill from Rep. Rick Boucher (D-VA) is likely to be introduced later this year, and the Federal Trade Commission has made it plain that the online ad business has a narrow window to show it can pull this off.

As I said earlier, I’m torn…really. I got my start in media on the traditional side, where we could make assumptions as to who our audience was, how they consumed media, and how receptive they’d be based on historical trends and survey data. Even with the introduction of people metered markets, I never felt enough of a direct connection between ad exposure and a conversion.

When I made the move to digital, I found myself floored by how much information was available. I could target my audience by the basic demos I always had, but I could also target based on behavior, and retarget, and so much more. As a marketer, it was eye-opening and felt a bit like playing a power game. Throughout the years, I’ve certainly had some qualms about how little people understand the back end that results in a banner ad being displayed next to the content they’re reading, but that’s never stopped me from using the tools at my disposal to do my job effectively on my clients’ behalf.

The addition of this new ad unit to the market place is a bit perplexing to me. I 100% understand why it’s being offered as an option and I applaud the three guinea pig advertisers for associating their brand so soon with this.  That said, despite the public’s curiosity with how their sinformation is used online, will they understand it?

The trust that might be garnered with these brands for being so open with the average internet consumer might be negatively coupled with the outpouring of technical data. For example, on a flight I took a few weeks ago, the pilot was over-explanatory with details relative to a fairly common mechanical issue with the plane I was sitting on. Was it great that the pilot was being so forthcoming with details? Certainly. Did it incite panic amongst the passengers because of information overload? Of course.

I’m not saying that presenting this information is akin to starting a panic riot, but I am concerned that putting too much information into the hands of  the typical internet user will be more information than is necessary. I wonder instead if we should move towards a more basic approach of simply opting out of seeing a particular banner ad with the general knowledge that one is seeing that ad as a result of targeting. With the industry’s trend to go big or go home, it would be great to find a good middle ground before overwhelming our audience.