Target users behavioural advertising to provide relevant ads to their customers

This article is about advertising that has been targeted at you (an individual), specifically, because of your online behaviour. But first, I’m going to tell you about me.

 

My whole life is online. I am a digital marketer by profession but I also love technology and the internet and especially the cloud, for my personal life. I love that Shazam (an iphone app) can tell me what the music is on the radio I’m listening to in the car. I love that I can use my TV as a screen for my ipad or that I can watch movies on my computer through AppleTV. I log in to most of these services and give the companies who build these systems insight into who I am and what I like and sometimes they use it to target me with information, products, sales and advertising that they think I will respond favourably to. This is called behavioural targeting.

 

I shop online, I subscribe to newsletters and buy insurance and read and comment on news stories online. I use an RSS reader to keep track of websites and blogs that I like. I use Flipboard, an iPad/ iPhone app that pulls in feeds from websites around the world, based on the categories that I chose, based on my interests. I use Google to search for images for my blog posts and Google Docs to share a calendar with my husband and Gmail to keep in touch with friends, colleagues and clients. I buy almost everything with my credit card, because I want the points to get free overseas flights at least once every 2 years and I scan my reward card whenever I can to get discounts and frequent flyer points. And with almost all of these things I login online to check my balance/ messages or points status.

 

And I’m ok with this. I know and understand the online world and I give my information freely. I use it for convenience but also because I personally think privacy is a myth and has been non-existent since satellites have been orbiting the earth. There has been so many news reports in recent months about the SOPA privacy act in the US and Google’s consolidation of all of their 60 product privacy policies into 1 so that they can now collect all their user’s data in one central database. Last year the Internet Advertising Bureau (IAB) launched a new service, in collaboration with all of the big online publishers in Australia, to self-regulate the online advertising industry before the government legislates it – this service allows online users to opt-out of behavioural targeting. Your Online Choices allows users to opt out of or turn off online behavioural advertising – of course you have to know it exists and hope that the websites you frequent are one of the publishers that is part of the program.

 

But why would you not want to be targeted by behavioural advertising? I understand some people have had their identity stolen and are nervous about online privacy but getting email spam or online ads about erectile disfunction, when you’re a 25 year old woman – surely we can all see the benefits to behavioural advertising targeting? But, I do get that it can be a bit big brother-ish when its done too well – and don’t worry, most advertisers are still grappling with personalisation in emails so they’re not too advanced when it comes to behavioural targeted advertising, but there are a couple who are doing a pretty good job. Woolworths in Australia and Target in America.

 

In February a journalist from the New York Times did an article on how Target figured out a teenage girl was pregnant before her father did. It’s an incredible story about how accurate behavioural targeting can be, even down to predicting the due date of a customer’s unborn child. The reason I came across this article was because Flipboard, the iPad app that I use that pulls in RSS feeds about information that it thinks I like, served up this article from Forbes.com, about how granular behavioural advertising can get, for me to read and now share with you.

 

Target monitors the type of products their customers buy and attaches a unique id number to an individual customer’s name, credit card or email address. This product purchase information is stored alongside demographic data and is then analysed for patterns that might give target insights into what type of things customers might buy in the future. Target then uses this statistical information to send relevant, targeted advertising to its customers in an effort to give them incentives to buy the products that they need anyway – if the behavioural targeting has been accurate.

 

In this instance, Target was able to tell that a specific young woman was pregnant because she was purchasing unscented lotions and dietary supplements like zinc and magnesium. So they sent her coupons for baby clothes and cribs – to which her father saw, flipped out and complained to Target. It was only when the store manager called back a few days later to apologise again that the father admitted that his daughter was indeed pregnant. He didn’t know at the time. Target’s behavioural advertising was so effective that they had accurately predicted this customer’s pregnancy before she had told her parents.

 

But what I find really interesting, is that Target found that if their targeted advertising was too obvious, as in the whole brochure was about baby products, then people didn’t buy the products. But if Target hid the intended products amongst some other random sales coupons, the customer thought that they had received the same advertising as everyone else, and as a result used the coupons (for the targeted products in most cases). So, targeted behavioural advertising works, but only if you’re subtle about it. People don’t react well when they realise how much brand’s know about them and even if they’re comfortable with their personal purchase history being recorded and used for targeted advertising, they don’t want to think that they are that easily led.

 

So of course its a bit creepy and in this particular instance it might have caused some damage, but isn’t it pretty amazing how much data some advertisers have on their customers and that their segmentation analysis is so advanced that they can use it to create relevant and helpful advertising that guides us in the direction we need to go?

Well, I think so. Behavioural advertising is OK with me, but if you want to turn it off for your computers, you can go to Your Ad Choices and opt out.