This Is Huge!

In the summer, an unparalleled group of previously disparate interests in the online advertising ecosystem agreed to speak the same language about behavioral advertising.

The Association of National Advertisers, the American Association of Advertising Agencies, the Direct Marketing Association, the Interactive Advertising Bureau and the Council of Better Business Bureaus agreed to common privacy principles to guide online behavioral advertising practices.

This is huge.

Parenthetically, as those of you who know me are aware, I am sometimes given to overstatement to show excitement. But I have never before used the word “huge” in the more than two years I have written this column. I would be remiss if I did not send kudos to the Venable law firm for managing the not-so-trivial task of bringing so many varied interests together.

The meat of the new self-regulatory 
principles is in seven key areas. The areas are directly responsive to the Federal Trade Commission Staff Report: Self-regulatory Principles for Online Behavioral Advertising, dated February 2009. The seven principles focus on education, transparency, consumer control, data security, material changes to online behavioral advertising policies, sensitive data and accountability.

You may have seen some news accounts of the release of these self-regulatory principles. It even included a supportive quote from FTC Commissioner Pamela 
Jones Harbour.

I believe that IAB CEO Randall Rothenberg captured the need for cross-industry collaboration best: “Although consumers have registered few, if any, complaints about Internet privacy, surveys show they are concerned about their privacy. We are acting early and aggressively 
on their concerns, to reinforce their trust in this vital medium that contributes so significantly to the 
U.S. economy.”

Consumer trust and confidence are critical to maintaining a diverse, open, low-cost or no-cost Internet ecosystem. That is as true for consumers as it is for advertisers. The seven principles strike a balance between consumer concerns regarding the use of information and 
interest-based ads while preserving the innovative and robust advertising that supports free online content, as well as preserving the ability to deliver the relevant advertising that consumers say they value.

The breadth of this impressive assemblage of advertising interests means that for the first time since the dawn of online behavioral advertising more than a decade ago, advertisers, marketers, agencies, technology and data providers, search engines, ISPs, portals, and online publishers all have committed to follow the same self-regulatory rules.

The implications of the new ecosystemwide self-regulatory principles are that negotiations, insertion orders, contracts, etc., are more frictionless. These principles also promise consumers more prominent and more consistent notice and choice.

At the time of this writing, working groups at the IAB and NAI (who applauded the release of the principles) are developing standards for how to implement the “enhanced notice” and other features of the principles. Meanwhile, the DMA and BBB are working on enforcement regimes that are expected to be implemented in early 2010.

What are some of the things we might expect to see from these implementation efforts? Some of the enhanced notice working groups are beginning to develop protocols for in-context notice—that is notice in or around the advertisement. These groups are making progress on how this would interact with the ad itself as an overlay, as well as how best to work with publishers who are interested in supporting enhanced notice.

To complement these efforts, there are folks working on what notice should look like when it is not part of a privacy policy. Some have demonstrated concepts such as having an “Advertising Policy” on their Web sites, and other ideas are being generated.

It is too early to tell how the implementation of these self-
regulatory principles will manifest themselves. But it is encouraging that the conversations are occurring and continue to move forward at a brisk pace.