The issue of online privacy can be argued from the standpoints of two main camps: consumers and marketers. Which side are you on?
If you are a consumer, most likely you do not want marketers using their websites to gather personal data on your websurfing habits, purchasing patterns, and what you are most likely to click on. It's creepy.
If you are from the marketer camp, your argument will be that the more data you gather on your market and consumers, the better you are able to serve your market and consumers.
A recent report by the FTC promotes guidelines for online businesses to follow in how they respect the privacy of their consumers.
An excerpt from this report:
“Companies should adopt a ‘privacy by design’ approach by building privacy protections into their everyday business practices. Such protections include reasonable security for consumer data, limited collection and retention of such data, and reasonable procedures to promote data accuracy."
I love how the report uses the word "reasonable" over and over again. What is the definition of "reasonable" in this regard? Who sets the standard for "reasonableness"? The word "reasonable" is just like the word "normal". When you really think about it, there is no such thing. It is all subjective. For example what is a "normal teenager" nowadays? In a previous post, we see that a "normal teen" is one that sends an average of over 2,000 text messages a day. I do not consider that normal.
But I digress...
Back to the issue of online privacy, we can see that the FTC has adopted what I like to call "strategic ambiguity". The phrase is used often in military strategy and foreign policy, allowing policy-makers wiggle room for their decisions. This is just a nice way of saying that it lets them do what they want.
The FTC will use the "reasonableness" standard to persecute who they want to persecute and ignore who they want to ignore.
My opinion is that the consumer culture in America should be an Opt In culture and not an Opt Out culture. In other words, it should be assumed from the start that consumers do not want to be contacted by marketers, but if they do, they can Opt In to be part of the marketing data collection. This is not how it is now, where you have to check or uncheck a box saying that, "no, I do not want to be spammed."
The great thing about Opt In consumer culture is that it forces marketers to offer value up front and soft sell their product. Soft selling is offering value first that compels the consumer to seek out the product/service for themselves. Hard selling is all the SPAM you find in your inbox.
Hopefully the new FTC report will guide marketers away from hard selling and direct sales techniques. I've just had to call a telemarketing firm to stop calling me and threaten to sue them. These new guidelines should make marketers go back and refine their techniques.
Until next time...
I agree that it would be ideal to become an Opt In culture because it would avoid a lot of privacy issues, but I honestly don't think it's realistic at this point in the game to think that can happen. I would love for the FTC to prove me wrong with new legislations but I think in this country the influence of corporations is sooo big that the FTC would never pass a law saying they can collect our information. Marketers are used to "tracking us" and the information is too valuable to let go easily.
ReplyDeleteHi Justin,
ReplyDeleteI like how you bring up the idea of the Opt In culture. Being on the consumer's side, I think it is a severe violation of the right to privacy of individuals when companies track their online activity. Not only consumer product industries, but even social networking sites like Facebook use cookies to track the web-pages one visits. For e.g., if I visit the profile of a particular friend more often, the side bars on my home page display her photographs. Wesites use 'cookies' to track this information and the recent legislation by the FTC will, in my opinion, give more control to consumers over the type of information they are willing to give access to websites to. I have discussed this issue in my article on behavioral marketing. Check it out!
http://bschool-bizbuzz.blogspot.com/2010/12/cookies-anyone-peep-into-privacy-issues.html
That's a really good point about opt in vs. opt out. In many instances, I am fine with marketers collecting data, as they provide me with a better shopping experience. However, that does not mean I want all marketers collecting data from me. I think simple laws could be drafted that do not need "strategic ambiguity" in useless terms like "reasonable," that make it illegal to collect data without the consumer opting in.
ReplyDeleteThis would allow those consumers who do wish to have data collected to enjoy the benefits, while easily shielding those who do not want data collected from the downfalls. It seems to be the simplest solution to this complex issue.
I have never really thought about the differences between an "opt in" and "opt out" option. I agree with you that everything should already be basic with options to opt in rather than the norm today. However, from the marketers point of view I can see how they would want everybody in and having to opt out. We also have to remember, that while the FTC is supposedly on the side of the consumer and protecting their privacy, they have to be cognizant of where their funding is coming from. I agree that their ambiguity allows them to change and create loopholes for the system. That is what the government does. Allow their constituents to assume they are being protected while creating loopholes so others can find ways in. It will be interesting to see how this all plays out...It has worked for the most part with the "do not call" registry but it will be interesting to see how that works on the internet.
ReplyDeleteJWU, with regards to the "strategic ambiguity" you refer to, what purpose does it serve here seeing as how the online consumer protection statutes will be under the FTC's jurisdiction? Do you think its a way to appease legislators, a way to avoid scaring away support from e-businesses, or even an admittance that the FTC alone cannot keep-up with the industry and that ultimately it is only the industry players themselves who can effectively address the issues? I think you are right in that use of such ambiguity is definitely intentional. I'm just not sure it is a good thing.
ReplyDeleteThe use of the dreaded "reasonable" word is as you say, intended to provide the legislators with leeway and more sway in the case of breaches. These recommendations are not likely to work or to make any perceptible difference. The only recommendation which might make a difference is the one that allows consumers to opt-out of being tracked.
ReplyDeleteWhile I agree with the idea of creating an Opt-In system, I think it is not very likely to happen. The information they recieve from these sources is too valuable. Making the Opt-out option compulsory is probably a more realistic second-best.
I really like the Opt In culture that you bring up. Everyone one of us has received thousands of SPAM mail advertising something completely pointless. The time and money that has been wasted on this is ridiculous. It would be great to have an option that says entertain me and try to sell me something. Unfortunately, I don’t think this will ever happen. As hard as it is to control SPAM mail it is even harder to control large business lobbyist that spend millions in advertising. Hopefully Congress can make an example of one of these companies and give them an excessive fine that make spammers throughout rethink if the concept is actually worth the risks.
ReplyDelete