Behavioral targeting and some comments from Google's Chief Economist

Earlier this week, I attended a talk by Hal Varian, Google's Chief Economist, on how computer-mediated transactions are transforming business practices. Towards the end of the talk, Varian touched on behavioral targeting -- or, as Google calls it, 'interest-based advertising'. He made the point that people are rarely concerned about the intended use -- more relevant content, better service, improved business practices, etc. -- of our personal data. Instead, we are concerned with unintended use: data getting into the wrong hands, being used against us, leaving us exposed and vulnerable. As such, argued Varian, the hot-potato issue in behavioral targeting is not really one of privacy, but one of security. The talk was particularly timely in light of Google's announcement not two weeks ago that it would be entering the behavioral targeting arena. Any move by Google is greeted with heaps of hubbub and opinion, and this one was no different. Commentators loved it, hated it, thought it was the worst move ever or accepted it as totally inevitable. Me, I've got two things to say about Google and behavioral targeting: 1. Google has to have a BT offering 2. BT faces inherent challenges, and Google is already coming up against them Without a doubt, Google has to have a BT offering. After all, advertisers are 'obsessed' with BT -- or so says a new report from the Search Engine Marketing Professionals Organization (SEMPO).

The official version of the SEMPO report... shows search engines have advertisers right where they want them. It shows "overwhelming interest" in newly developed behavioral targeting opportunities, with three-quarters of advertisers claiming they would pay bid more for clicks targeted to in-market consumers.

So BT is where the market is, and where the money is, and where Google has to be. That doesn't mean that they aren't going to get the same resistance as every other targeter, if not more. People concerned about the inappropriate use of their data get more concerned as the volume of data grows -- and in Google's case, we're talking about a heavy volume of data. And privacy protection is becoming more and more a hot-button, political, mainstream issue. Companies have to make sure they're giving the privacy question the respect it deserves. In Google's case, they've done some things right and some things not so right. They made their system opt-out rather than opt-in (not so right), but they let people see how they're being targeted and adjust the categories they're in (right). In the end though, as Varian said, it all comes down to security, and as amazing as Google's technology may be, it's not perfect. Gmail went down earlier this month, and a single misplaced slash in their code once had every search result erroneously reported as dangerous. Will reassurances of, 'Don't worry, we know what we're doing' be enough to alleviate people's privacy concerns? What do you think about privacy and security?

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