Legal and Ethical Challenges of Online Behavioral Targeting in Advertising
Abstract
Online behavioral targeting (OBT), the tracking of a consumer's online activities in order to develop a behavioral profile of the consumer, is a rapidly growing technique that enables advertisers to deliver relevant messages. While OBT provides many advantages to shoppers and advertisers alike, the practice has the technological potential to violate consumers’ privacy rights to a dangerous and unprecedented degree. Still, OBT is poorly understood by most consumers, is often nontransparent and deceptive, and in many cases does not even provide a reasonable chance to opt out. Due to OBT's relative newness, few laws, regulations, and policies, as well as in-depth ethical analyses of the practice, exist. Actions by the Federal Trade Commission (FTC), however, provide a notable exception. In a series of reports, in particular since 2009, the agency has engaged in dialogs with various stakeholders about OBT and the dangers it poses to consumers. Its efforts have also included legal enforcement activities. Within the context of these developments our article presents the evolution of the broader legal environment, including an ethical analysis of the FTC's efforts. Our objective is to shed light on the issue from a normative perspective and to assist online advertisers as well as regulators searching for guidelines and policies on how to use OBT in a responsible manner.
... One dominant targeting technology is online behavior tracking, which embeds third-party cookie files on users' browsers and tracks individual users' online behaviors. Advertisers analyze the tracking data to accurately identify individuals' interests and then deliver the most relevant ad messages to each individual (Ham 2017;Nill and Aalberts 2014). Consequently, consumers' video-advertising experiences could be elevated by serving relevant ad messages to individuals, inducing them to be highly involved in ad messages (Ham 2017;Ham and Nelson 2016). ...
... Our study aimed to examine the potential benefit of using an ad-choice option in mid-roll video advertising that significantly interrupts users' video-watching experience. We also attempted to test the moderation role of ad involvement on the effect of ad choice, given the fact that most digital advertising is now being delivered using behavior-tracking technology, which increases consumers' ad involvement (Ham 2017;Nill and Aalberts 2014). We employed ideas from PRT and ELM to discern the mechanism underlying the proposed relationships. ...
Online video ads on video-streaming platforms interrupt viewers’ video-watching experiences, presumably triggering anger, irritation, and negative cognition. Thereby, with a theoretical framework of psychological reactance, we call scholarly attention to the role of ad choice in mitigating the negative effect of interruptions from mid-roll video ads. We propose that the effect of ad choice will be moderated by ad involvement and mediated by psychological reactance. We conducted a between-subjects experiment with a 2 (ad choice: yes versus no) × 2 (ad involvement: high versus low) design by creating a realistic digital video-streaming environment. We found that the effect of ad choice was significant only when ad involvement was low. A significant mediating role of reactance was revealed only in the relationship between ad choice and attitude toward the ads; however, the proposed moderated mediation role of psychological reactance was not significant. Theoretical and practical implications are discussed.
... First, this study contributes to the literature on PK in the context of AI and ethnic affinity targeting. While studies have explored the ethical issues of online targeting from algorithmic systems (Plane et al. 2017;Speicher et al. 2018) and policy perspectives (Aalberts, Nill, and Poon 2016), consumers' persuasion knowledge about EAT is considered limited (Boerman, Kruikemeier, and Zuiderveen Borgesius 2017;Knoll 2016;Nill and Aalberts 2014). A consumer-centered study investigating ethical concerns and responses to AI-powered EAT practices is necessary. ...
... The pressure can be amplified when the data is used for decision-making that can have a direct impact on people's lives (e.g. targeted advertising, risk assessment, or law enforcement) [14]. To mitigate this pressure, users need assurance from researchers that the data will be anonymized to protect their privacy. ...
... Çevrimiçi ortamlardaki kullanıcıların kişisel verilerine dayanarak üretilen(Komanduri vd., 2012;Tene ve Polonetsky, 2012; Sableman vd., 2013; Smit vd., 2014; Aalberts vd., 2016;Akgün Akan ve Tanyeri Mazıcı, 2020) bu tür reklam ziyaret edilen internet siteleri, incelenen tüm içerikler, sosyal medya davranışları, e-posta ve mesajlaşma gibi çok çeşitli ortamların bir tür "dinlenmesi"(Evans, 2009;McDonald ve Cranor, 2009;Beales, 2010; Guha vd., 2010;McDonald ve Cranor, 2010;Stallworth, 2010; Leon vd., 2011; Backes vd., 2012;Cranor, 2012;Tene ve Polonetsky, 2012; van Noort vd., 2012; Sableman vd., 2013;Chen ve Stallaert, 2014;Tucker, 2014; Aalberts vd., 2016;Ham, 2016; Akgün Akan ve Tanyeri Mazıcı, 2020) yoluyla iletilerini güncelleyerek ve kişisel ilgi alanına göre hedefleme yaparak(Guha vd., 2010;Stallworth, 2010; Bilenko vd., 2011;Tene ve Polonetsky, 2012;Tucker, 2014; Aalberts vd., 2016;Brinson ve Eastin, 2016) etkinliğini arttırmaya çabalamaktadır. Kişiselleştirilmiş içerikler yoluyla hedef kitlesinin aradığı bilgileri sunması dolayısıyla tüketicilerin bilgi arayışlarında zaman kaybetmelerinin ve ilgilendikleri içeriği karşılarına çıkararak gereksiz reklam iletilerine tüketicilerin rast gelmesinin önüne geçtiği (McDonald veCranor, 2010; Komanduri vd., 2012;Tene ve Polonetsky, 2012; Sableman vd., 2013;Nill ve Aalberts, 2014; Smit vd., 2014; Aalberts vd., 2016;Brinson ve Eastin, 2016) yönünde tüketici açısından çeşitli avantajlarının olduğuna vurgu yapılmaktadır. Ancak, kimlik bilgileri, sosyal güvenlik numarası gibi veriler dışında yalnızca çevrimiçi davranışlara odaklanarak tasarlandığı iddia edilen bu reklam türü, tüketiciler ve tüketici odaklı kuruluşlar tarafından olası ve mevcut gizlilik endişeleri (McCole vd., 2010; Milne vd., 2009; Miyazaki, 2009; Rozendaal vd., 2011b; Tene ve Polonetsky, 2012; Rao vd., 2014; Tucker, 2014; Neyens vd., 2017; Vanwesenbeeck vd., 2017a; Taşkaya ve Talay, 2019) sebebiyle pek çok tartışmanın odağına yerleştirilmektedir. ...
This doctoral thesis study, which aims to design, implement and evaluate a digital-based education model that will help parents, who are described as digital immigrants, to acquire digital advertising literacy skills that they will benefit from both in their own lives and in their mediation experiences with the intention of guiding their children, was carried out within the framework of the action research design. In line with the purpose of the study, qualitative and quantitative research techniques were used to determine the digital advertising literacy competencies of the parents and their children, who attended secondary schools in Antalya in the 2020-2021 academic year, before and after the implementation of the education model, and to evaluate the effectiveness of the model. The data obtained from the participants through qualitative techniques were analyzed with the help of MAXQDA 2020, and the data obtained through quantitative techniques were analyzed with the help of IBM SPSS 26.0 package programs. The findings obtained from the analysis of the quantitative and qualitative data of the research showed that the digital-based digital advertising literacy education model recommended for adult parents is effective in gaining digital advertising literacy skills. In line with the results of this doctoral thesis, suggestions for researchers, educators and legislators were presented.
The purpose of this research paper is to find an effective way to provide the data subject with proper individual control over personal information via notice- and-consent mechanism in the processing of alternative credit data under the Thai personal data protection law.
This study employed a qualitative research method by (1) reviewing the origin, legal concept, and practice of the protection of personal data by providing the data subject with individual control over personal information via notice-and-consent mechanism; (2) examining the criteria and elements in law that determine notice-and- consent mechanism relating to the processing of alternative credit data; and (3) analyzing and evaluating whether the Thai personal data protection law properly provides the data subject with individual control over personal information via notice-and-consent mechanism in the processing of alternative credit data by comparing the Thai law with international measures, frameworks, laws, and relevant cases.
This study found that (1) the legal concept of granting individual control over personal information, especially via notice and consent has long been playing a key role in information privacy law, and widely adopted in credit process; (2) the processing of alternative credit data presents the risks of failure to inform, lack of freedom to choose and decide, and improper reuse and repurpose that undermine individual control; (3) although the Thai Personal Data Protection Act (PDPA), 2019 (B.E. 2562) has provided fair individual control over personal information relating to alternative credit data processing, it still has certain limitations, including inflexible and impractical notice and consent, and lack of clear guidance on subsequent use of personal data. This study, therefore, recommends the relevant Thai authorities to impose stricter requirements under the PDPA or issue financial regulations that focus on the data subject’s understandability, establish greater resilient, substantive, and consumer-centric notice and consent, and ensure the controller’s accountability.
The current study is the first to report N2 Defining Issues Test (DIT) moral reasoning scores and life-story interviews of advertising executives perceived as ethical leaders. Combining N2 scores with in-depth moral justifications provides a detailed view of morality to better understand what normatively appropriate behavior is, both in and outside of advertising, and how it develops. Scores reflect the preference to apply universal moral principles, especially when depicting strategic communication scenarios, yet there is less preference for universal moral reasoning when personal interest justifications are also considered. Life stories provide evidence of introspection and growth in response to adversity and ethical breaches; situational moral reasoning reflective of the human-centric, empathetic, and interpersonal nature of advertising; and a desire to do social good representative of empathy in action.
Big data, which has been used intensively in the field of marketing, is of great importance in the analysis of consumer behavior, in predetermining the changes in consumer needs and wants that may occur in the future, and in the development of marketing strategies suitable for these wishes and needs. Yet, there are few empirical studies of consumer behavior with big data. In this context, the aim of the study is to discuss how big data is used in the analysis of consumer behavior and to reveal its advantages. In addition to this, it is also aimed to observe the practitioners' attitudes on how big data determines consumer behavior. For this purpose, the interview technique was chosen in order to collect data in the study. In the survey, senior managers of 10 different companies in Istanbul, which are currently using big data, were interviewed as field research, and qualitative data analysis was carried out in the NVIVO program. As a result of the analysis, it is seen that companies obtain comprehensive information about consumers by using big data. In light of this information collected, companies can predict consumer behavior, carry out their digitalization activities more efficiently, and develop data-based consumer-specific advertisements.
A business must reach the right target audience at the right time with the right product or service in order to exist in the market. Every right strategy implemented by a business will leave a positive impression on customers’ loyalty to the brand. Businesses need to know their customers well and thus give the right messages with the right strategy to reach their goals. Intelligent advertising with behavioral targeting based on blockchain technology enables the brand to communicate correctly with its potential customers by using a large amount of data. There are many elements in the data set regarding the behavioral analysis of the target audience: the lifestyles of the consumers, their shopping habits and the relationships they form, etc. These elements reflect the demographic, socio-cultural and psychological characteristics of consumers.
This paper describes an advertising ethics course designed for first-year students of any major, written from the perspectives of both the course creator/instructor and the students who took the course and developed a workshop based around it. As educators, how do we help students learn and care about how their data is collected and used and further understand the ethical issues of these practices? Our goal is to raise awareness for data rights issues by helping students from a variety of educational disciplines make informed decisions using experiential learning opportunities that display the importance of data in society.
This report offers a history of Fair Information Practices (FIPs) with a focus – but not an exclusive one – on activities in the United States. The text usually quotes key portions of source documents in order to allow for comparison of different versions of FIPs. For the most part, the analysis is neutral, with only limited interpretation, comment, and criticism.
FIPs are a set of internationally recognized practices for addressing the privacy of information about individuals. Information privacy is a subset of privacy. FIPs are important because they provide the underlying policy for many national laws addressing privacy and data protection matters. The international policy convergence around FIPs as core elements for information privacy has remained in place since the late 1970s. Privacy laws in the United States, which are much less comprehensive in scope than laws in some other countries, often reflect some elements of FIPs but not as consistently as the laws of most other nations.
The computer revolution has created a world where communication is cheap and instantaneous, and where vast amounts of information and consumer goods are just a click away. It also has created a world where the electronic gadgets we use every day create a trail of information that is being collected, examined, sold, and-far too often-stolen. Individuals have little to no control over the use and sale of this personal, private information, and the law has failed to keep pace. Some privacy advocates have suggested that traditional privacy torts should be used by the courts to stop the worst of these privacy invasions. However, these torts, developed more than fifty years ago, are ill-suited to the task. In addition, many states and the federal government have passed laws and regulations to protect the most sensitive of private information from prying eyes. But these laws have proven to be inadequate in a rapidly changing world of iPhones, Netflix, and Internet searches. What is needed is a national standard that will protect the privacy of individuals without stifling innovation. A ban on the dissemination of private information, along with more stringent laws meant to prevent identity theft, will go a long way to achieving these twin goals.
Strategic Management: A Stakeholder Approach was first published in 1984 as a part of the Pitman series in Business and Public Policy. Its publication proved to be a landmark moment in the development of stakeholder theory. Widely acknowledged as a world leader in business ethics and strategic management, R. Edward Freeman’s foundational work continues to inspire scholars and students concerned with a more practical view of how business and capitalism actually work. Business can be understood as a system of how we create value for stakeholders. This worldview connects business and capitalism with ethics once and for all. On the 25th anniversary of publication, Cambridge University Press are delighted to be able to offer a new print-on-demand edition of his work to a new generation of readers.
This article addresses a significant gap in the theoretical literature on marketing ethics. This gap results from the lack of an integrated framework which clarifies and synthesizes the multiple variables that explain how marketers make ethical/unethical decisions. A contingency framework is recommended as a starting point for the development of a theory of ethical/unethical actions in organizational environments. This model demonstrates how previous research can be integrated to reveal that ethical/unethical decisions are moderated by individual factors, significant others within the organizational setting, and opportunity for action.
The authors examine the impact on consumers' purchase likelihood after learning about online covert marketing practices. The findings suggest that while learning of online covert marketing practice lowers purchase likelihood, it is moderated by contextual factors including prior purchase experience, whether the company is well known or a start-up, and whether covert marketing involved information gathering or promotions. Consumer background variables were also found to moderate the negative impact on purchase likelihood resulting from consumers learning about online covert marketing activities. Conjoint scenarios were examined and a segmentation study was conducted based on a national survey of U.S. consumers. Implications for advertisers and regulatory action are discussed.