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Online Behavioral Advertising Self Regulation Moves Ahead as DDA Adds to List of Approved Providers

online behavioral advertisingDigital Advertising Alliance (DAA) has designated another company as an approved provider for its Self-Regulatory Program, aimed at protecting consumer privacy online. In addition to DoubleVerify (announced last December), TRUSTe will now also add the “Advertising Option Icon” into its Online Behavioral Advertising (OBA) solution.

This suggests that the Digital Advertising Alliance (DAA) — the advertising industry’s governing body for ad privacy is injecting some real pace into its self regulatory moves on online behavioral advertising.

Online behavioral advertising is much maligned by members of Facebook ,Gmail and other users, who believe as a matter of principle that services on the internet should all be free. However, most of us would accept that for these services to survive, the owners of these sites must be allowed to make at least enough money to pay for the service. The hard reality is that unless these web services are profitable they won’t survive, and online behavioral advertising can be a useful tool to this end.

Online behavioral advertising does have some advantages for users.

First of all by more accurately targeting advertisements it should, at least in theory mean that click through rates are higher and advertisers need to clutter up their pages less with banners and offers.

It has also been suggested that this form of advertising focus shows much promise for localization, allowing newspapers, for example, with new ways to support local journalism, while answering consumer calls for fewer irrelevant and distracting ads.  It would be possible to use this technology to direct local news for their home town at individuals on their laptops, handheld devices etc, when away from home, which is not something which can be done easily by other methods.

Online Behavioral Advertising has been defined as the collection of information from a specific computer or device (rather than from an individual consumer) regarding web viewing behaviors over time and across websites in general to use such information to predict user preferences or interests to deliver relevant ads to the computer, or smart phone device, based on the preferences inferred from such behaviors.

It is quite difficult for most people to get a hold of what this form of advertising is from that definition. Maybe it helps to say what it is not. Online behavioral advertising does not include the activities of first parties, nor is it directly ad delivery or ad reporting. It is also a different concept from contextual advertising (i.e., advertising related to the subject matter of the web page browsed).

The biggest “con” or argument against online behavioral advertising argument against it is that of invasion of privacy. The big concern is that it’s like a jigsaw. If you have the information released and you can match it to other publicly available data about somebody, you can often put together a much more complete picture than the average person would realize, or be comfortable with.

The FTC and human rights activists have long been concerned about this in connection with online behavioral advertising. The FTC in the US has been under pressure to regulate its use more closely, however, self regulation is still the order of the day both in the US and in general around the world. So, implementation of the US online behavioral advertising initiative largely rests with “third party” accreditation of advertising networks and data companies such as will be provided by the likes of DoubleVerify and TRUSTe.

It has been reported by some that many corporate online website service providers are holding back on utilizing the method until regulation is established, for fear of the negative publicity they might receive, until they can show that they fully comply with respected industry guidelines. So, you could be seeing more online behavioral advertising on the sites you use, later in 2011, as a result of the DAA’s current moves to approve more providers.

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