"It's become an essential part of the marketing mix," says Adam Kleinberg, CEO of Traction, an advertising and interactive agency in San Francisco. Data brokers are "becoming increasingly important because the way digital media is being purchased is moving toward the robots. Programmatic advertising and programmatic media buying is using tools that automate the process," he says. "You enhance the targeting efficiency by leveraging that data. It's just gotten to the point in the past few years where 30 to 40 percent of media is purchased that way."
These profiles are directional and optimized behaviorally, Kleinberg says. The cookies that follow us around the Internet are being used to index us based on behaviors such as what we search, visit, click on or buy. "If you actually saw your data you'd think 'wow, these people don't know me at all,'" he says.
"The power of the data in certain circumstances is in the massive quantity and patterning that is possible. When you're collecting across billions of data points, regardless of its accuracy, there's going to be groups of individuals behaving the same way," Kleinberg adds.
"There is sensitive data that is collected and sold on you... What's new is this big data that is being collected and cross referenced with those things," he says. "The reality is that most of this big data is simply being used anonymously to better target you with an ad."
Can Marketers Police Themselves?
While he freely admits "the ability to look at that individual data is a little scary," he adds that "anyone who's buying digital media today is buying data."
From that the debate usually pivots around the promise of self-regulation versus the need for legal protections and regulations. Industry groups like the Internet Advertising Bureau and the Network Advertising Initiative have already developed standards and best practices which member companies must adhere to, but it appears unlikely that will remain their exclusive responsibility. Regulatory agencies and elected officials aren't subscribing to simple notion that the ends justify the means. Legislation could be on the horizon as they aim for a middle ground.
Sharing the view of the industry at large, Kleinberg says he thinks the responsibility should come from within because regulators don't have a deep understanding. "I think that the industry organizations are actually taking it very seriously and putting together standards that accommodate reasonable privacy restrictions like allowing people to opt out," he says.
"I think consumers care less than we think in the moment. They care in the abstract sense," Kleinberg says. "I can't tell you of an example where data has been abused."
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