January 14, 2016

The Pew Research Center has released another in a series of studies of privacy issues with fresh evidence that consumers do not want to sacrifice personal information to get served targeted ads.

A separate study from the Annenberg School of Communications at the University of Pennsylvania, to be presented at a Federal Trade Commission conference today, finds many consumers resigned to their personal habits being harvested for commercial use. But they do not like it or buy the idea that it’s a fair tradeoff.

So add unresolved privacy concerns to a long list of challenges digital advertising is facing in the new year — ad blocking, low rates from programmed buying and possible FTC restrictions on native ads.

Past Pew studies typically surveyed attitudes on privacy.  This one instead sets out six scenarios and asked respondents which they found acceptable because of potential benefits and which not.

None of the scenarios treated news sites directly.  However one asked if users would participate in a social site started for a  school reunion if they knew their personal information profile “would be used by the site to deliver advertisements that it hopes will be appealing to you.”

Only a third of those survey found the tradeoff acceptable.  51 percent said it was not, and the rest were undecided.  In the study, consumers saw more benefit and mostly approved scenarios involving surveillance at a workplace to stop thefts, agreeing to digitalized health records for a doctor’s office or getting loyalty card discounts from a grocery store that tracks your spending habits.

Comments accompanying the advertising scenario included:

It would depend on if I could easily delete this account if I didn’t like how many ads I received.

 I hate receiving advertisements on the internet from people and companies that do not interest me. It creates so much spam.

Although I understand this scenario is already standard practice, it uses information collected about me in a manner not for my benefit, without my consent. It would affect how I use the reunion site or whether I even join the site at all.

Those surveyed on a different question also showed particularly strong negative reactions to providing location data if that resulted in they’re getting a bunch of ads on their smart phones.

Lee Rainie, who directs Pew’s Internet research and is principal author of the study, agreed that one could infer discomfort with covert personal data mining for commercial purposes. But in an email exchange he cautioned:

Some are surely wary of sharing personal information and what that means for inviting targeted ads into their lives. But many spoke to other issues in their open-ended answers. They weren’t sure about the ‘marginal cost’ of adding another social media platform to their lives. They thought that existing social media platforms could serve this need. They also expressed some concern about adding to time-demands that often accompany use of social media. So, the answers here don’t fully mean that people are balking at targeted ads.

The Annenberg study by Joseph Turow challenges head on the notion that consumers enter into a bargain  sacrificing some privacy as an inevitable consequence of full use of the Internet.  The conclusion is that a majority of people are resigned to that happening but not at all happy with it.  The paper’s opening lays out the findings in these terms:

New Annenberg survey results indicate that marketers are misrepresenting a large majority of Americans by claiming that Americans give out information about themselves as a tradeoff for benefits they receive. To the contrary, the survey reveals most Americans do not believe that ‘data for discounts’ is a square deal.

The findings also suggest, in contrast to other academics’ claims, that Americans’ willingness to provide personal information to marketers cannot be explained by the public’s poor knowledge of the ins and outs of digital commerce. In fact, people who know more about ways marketers can use their personal information are more likely rather than less likely to accept discounts in exchange for data when presented with a real-life scenario.

Our findings, instead, support a new explanation: a majority of Americans are resigned to giving up their data—and that is why many appear to be engaging in tradeoffs. Resignation occurs when a person believes an undesirable outcome is inevitable and feels powerless to stop it. Rather than feeling able to make choices, Americans believe it is futile to manage what companies can learn about them. Our study reveals that more than half do not want to lose control over their information but also believe this loss of control has already happened.

The study goes on to suggest that policy-makers like the FTC reject the “tradeoff argument” as a “false justification” for allowing wholesale harvesting of personal data. (At today’s hearing the FTC is simply hearing presentations by academics — not deciding policy).

Complicating the issue for news sites, as I and others have been saying for years, most readers are unaware how many cookies are gathering information on them.  50-plus is not uncommon.  Lately the cookie clutter has re-emerged as a factor in the annoyingly slow load times of so many sites, especially on smartphones.

This is a case of what customers don’t know may hurt them — and digital publishers too —  unless current practices are reformed.

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Rick Edmonds is media business analyst for the Poynter Institute where he has done research and writing for the last fifteen years. His commentary on…
Rick Edmonds

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