The Pontiflex Blog

FTC takes wait and see attitude towards behavioral targeting guidelines

February 26, 2008 at 2:54 pm Arun Krishnan Leave a comment

In recent times, the FTC has been among the most active players in the online advertising arena. The FTC has been particularly focused on the behavioral targeting and lead generation industry segments, where the lack of respect to consumer privacy has been a major factor in fanning it’s wrath. Now, in response to the recently released IAB guidelines on behavioral targeting, the FTC has decided to adopt a watch and wait policy.

2008 is a big year for the IAB as far as guidelines go. Earlier this month, the IAB had released more detailed guidelines for online lead generation.The big question is: will these guidelines have any effect in driving change in the industry?

Three factors driving the evolution and adoption of a meaningful set of guidelines are common to both behavioral targeting and online lead generation:

1. The authority of the FTC.

2. The ability of the two parties to have an open and honest dialogue, and

3. The bigger advertisers and publishers adopting these guidelines (though the smaller and lucrative long tail segment will have to fall into line especially in the online lead generation industry).

However, the primary factor driving the adoption of the guidelines will have to be different for each of the industry segments.

In the case of behavioral targeting, a large part of the success will be dependent on how successful the industry is in persuading consumers that behavioral targeting leads to a more relevant online experience (e.g being served advertisements with branding and promotional messages at relevant stages of the buying cycle.)

For online lead generation, advertiser demand for a high lead quality and improved conversion rates will open up the industry at large. Third party brokers that cause a lack of transparency will have to give way to the winds of change – hopefully stronger than a breeze.

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