As advertisers develop more sophisticated online tracking tools, federal agencies and consumer interest groups are pushing for stricter privacy standards. Do Not Track, the latest web tracking opt-out movement in the U.S. is gaining ground, with browsers and companies alike being pressured into providing simple opt-out technologies to keep individuals personal information private.
There is precedent in Europe already: the European ePrivacy Directive is a law that requires sites to proactively gain consent from visitors to track them. See the issues at hand, as well as the potential revenue pitfalls and other impacts.
ONLINE ADVERTISING AND TRACKING SOFTWARE
Allows visitors to control websites’ ability to track them online.
“DO NOT TRACK” industry best practice, allows visitor to opt out
“EUROPEAN EPRIVACY DIRECTIVE” enforceable law, requires visitor to opt in
WHO BENEFITS FROM TRACKING?
Cookies are the most common method for tracking visitors. Different types of cookies serve different interests.
- Shopping Cart: Remembers items in a cart
- Personalization: Personalizes content such as welcome page
- Re-Targeting: Shows ads to prior site visitors
- Analytics: Counts the number of pages visited
- Ad Network: Makes inventory available for cross-site campaigns
- Real-Time Bidding: Sells audience impressions at auction
In 2011, tracking technology was embedded in 80% of 1,000 top websites. In 2005, the amount was 40%. The number of tracking files these sites install on an average computer is 3,180. The top 50 U.S. websites average 64 different tracking tools.
TOP FIVE SITES FOR TRACKING (BY NUMBER OF FILES INSTALLED) 2/3 of these are installed by 131 tracking companies
- 91% of internet users are aware they are being tracked
- 93% of users claim they would use a Do Not Track feature
- 52% believe they should have complete control over what’s being tracked
For example, Firefox owns a third of the browser market: Consumer useis steadily growing: User adoption of Do Not Track feature has doubled in one year to 7%. Mobile user adoption is already at 18%.
THE ONLINE ADVERTISING INDUSTRY IS WORRIED – Online merchants need targeted ads to generate sales. After implementation of European laws, retailers saw a 65% decrease in ad effectiveness Projected 5-year revenue loss if US implements EU-style opt-in laws $80 BILLION
Worth 2X – Advertising targeted according to a person’s interests and online history is worth more than twice as much to advertisers than ads that are not targeted
OPT OUT IS NOT ALWAYS WHAT IT SEEMS
In a recent study of 64 companies, 33 left their tracking cookies in place after the user opted out – 8 saved some user info on the user’s computer after the user opted out
THESE VIOLATIONS CAN HAPPEN UNINTENTIONALLY