11.1.17 Consumer Awareness

Weighing Personalization with Privacy: How the DAA’s AdChoices Program Brings Transparency to Interest-Based Digital Advertising

By: Jon McDonald

The Crunch: As digital ads become more relevant and consumers demand more control over their privacy, businesses find themselves at a crossroads. That is why the Digital Advertising Alliance created the AdChoices program, which makes interest-based online ads transparent — providing benefits to both sides. By clicking the AdChoices icon on an advertisement, a consumer can see whether information is being collected and by whom — and can opt out of that data collection and use for interest-based advertising. The DAA remains a champion for responsible self-regulation in digital advertising, providing guidance and tools around new technological developments, such as cross-device data tracking and in-app ads.

Spending on digital advertising is predicted to increase 16% in 2017 to a staggering $83 billion, underscoring its importance to commercial marketing efforts. And as the ad industry continues to expand with the addition of new ad channels and mobile platforms, consumers are expressing a desire for more control over their personal information, which businesses use to provide more relevant and targeted ads.

Lou Mastria, Executive Director at the DAA, spoke with us about how the organization helps businesses respect consumer privacy.

Online advertising helps support the free content, products, and services consumers get on the internet. But meeting the need for privacy while still effectively delivering ads can be a delicate balancing act. That’s why the Digital Advertising Alliance is on a mission to help advertisers embrace transparency through self-regulation while giving consumers choices about the types of ads they see — and the information used to deliver them.

The DAA, an independent nonprofit organization that promotes responsible privacy practices, launched the AdChoices program seven years ago to enhance trust and confidence in digital advertising.

When consumers click on an AdChoices icon, they have access to real-time control over whether to share information for interest-based advertising — which will affect the ads they see in the future. Today, AdChoices is the business standard across the web.

“AdChoices icons are being delivered at a rate of a trillion times a month, globally,” said Lou Mastria, CIPP, CISSP, Executive Director at the DAA. “That demonstrates it is a responsible industry that can take important matters into its own hands.”

In addition to transparency, the guiding principles for the DAA and its industry partners include consumer control, data security, and clear accountability for all ads — including those from third parties and service providers.

As digital advertising becomes more prevalent — and necessary — the DAA fosters a trust between consumers and businesses by showing a good faith effort on the part of companies to respect privacy and choice.

AdChoices Icon Inspires Consumer Trust Across the Web

The AdChoices icon may be one of the most prevalent symbols on the internet today, usually appearing in the corner of digital ads worldwide. And companies that place the AdChoices icon in their advertisements show a commitment to the transparency and privacy that modern digital consumers expect.

“The icon inspires confidence not only in the advertiser, but also the process and the program,” Lou said. “That means brand integrity, which is why companies look to this program and want to embrace it.”

AdChoices is designed for easy implementation, and the icon is simple to place on ads designed for desktop, mobile, or app. When consumers click on the icon, they can view information on collection practices, including how specific ads end up in front of them, and they can access tools that allow them to opt out of data collection for interest-based advertising.

That doesn’t mean they won’t see any online ads — in fact, they’ll see the same number of ads. What opting out means is that advertisements won’t be as personalized. That’s why many consumers choose to keep providing their information — while still appreciating the transparency and control.

“Those privacy controls and safeguards didn’t exist before AdChoices,” Lou said. “At that time, you were lucky to be able to do it on your own website; now we can implement it throughout the web.”

And as modern technology advances, the DAA can keep up with new channels, platforms, and consumer expectations because it is self-regulated, helping the organization stay on pace with innovation.

Self-Regulation Means Faster Response to Industry Challenges

The government’s inability to promptly pass legislation on matters that affect daily life can be frustrating, especially when it comes to consumer privacy and technology. While a bill makes its way through Congress, new technology and digital marketing techniques can emerge to make an issue obsolete before a vote takes place. That is why self-regulation is especially essential in the advertising industry.

“We can innovate a lot faster than legislation can. Seven years ago, everyone was focused on desktop, now the focus is mobile web and apps,” Lou told us. “In that time, DAA has updated its code three separate times — including for mobile and cross-device practices — giving companies and consumers a feeling of confidence.”

The DAA’s quick response to issues is what the industry demands, while relying on legislative measures would only lead to fewer choices for consumers — and diminished trust for brands. As a result, the DAA has set up robust regulation protocols that help businesses stay compliant with the organization’s code for cross-device and in-app advertising, beginning with its scope. The organization even holds the DAA Summit each year to talk about best practices and emerging trends.

Xenia “Senny” Boone, left, senior vice president for corporate & social responsibility, Data & Marketing Association; Genie Barton, President, Institute for Marketplace Trust, Council for Better Business Bureaus; and Michael Signorelli, DAA counsel and partner at Venable LLP participate in a panel on industry accountability at the 2017 DAA Summit.

“We don’t just regulate the companies that are part of DAA; we regulate the entire interest-based advertising market,” Lou said. “It isn’t just a club, it is market-wide self-regulation, which is critical.”

The DAA’s enforcement function, run by the Council of Better Business Bureaus and the Data and Marketing Association, has complete independence to identify and take action to address any businesses that are not following the organization’s guiding principles.

“We don’t know who is being audited and for what, and I won’t find out until it shows up in the press, and that is the way it ought to be. Investigations are handled away from DAA,” Lou said. “It is part of the firewall between the DAA and the accountability programs to make sure that there is integrity in the program.”

The DAA believes that separation is key to its integrity in the industry, and is committed to increasing its oversight to ensure that impartiality as both technology and digital advertising evolve.

In-App & Cross-Device: Helping Brands Address Emerging Tech

Updating its code for cross-device and in-app advertising shows how the DAA regularly addresses new technologies and strategies. As mobile browsing became more prevalent, the cross-device guidelines directed companies to halt all data collection for interest-based advertising linked to a device once consumers choose to opt out on that device.

The DAA adjusted to a mobile-first approach because of the shift in consumer sentiment, which is why it also focuses on another popular aspect of the mobile experience: In-app advertisements.

“We have extended that same user interface into the in-app environment with a product called AppChoices,” Lou said. “We have 40+ companies on that platform that allows consumers to experience the same AdChoices user interface you get on the web within the app.”

Consumers can opt out of seeing relevant in-app advertisements by downloading AppChoices on their mobile device.

Consumers can download the AppChoices mobile app to find information on the ads served by DAA participants and choose whether to opt out of data collection. The app was developed based on consumer sentiment to have the same ad choices and experience on their mobile devices.

“We asked consumers, and they enjoy that feeling of comfort that comes from consistency and the ability to maintain control, irrespective of the platform,” Lou said.

That also builds value for companies who want to maintain the trust that comes from being a member of the program across digital channels. And the DAA’s commitment to transparency in emerging channels has earned it praise from government regulators, as well.

In its latest cross-device report, the Federal Trade Commission (FTC) lauded the DAA for keeping up with modern technologies, providing guidance, and improving consumer protection in the marketplace.

Providing Businesses the Foundation to be Proactive About Privacy

The prevalence of digital advertising will continue as targeting strategies become more efficient. But, as consumers today demand more control over their data and privacy — something has to give. The DAA is helping businesses give consumers choices while maintaining effective ad campaigns and securing brand trust.

The organization has come a long way since it introduced AdChoices in 2010 when the overwhelming majority of consumers were using desktops throughout their customer journey. Now, the DAA has innovated cross-device and in-app tools that allow companies to show a transparency that is appreciated by an increasingly privacy-centric online audience.

“We are starting to create a world where, if you make a choice on a device, you know that choice is going to be honored in a very robust way,” Lou said. “I think that is important for consumer confidence and brand confidence.”

The program also helps marketers become more knowledgeable about what consumers want on emerging advertising channels.

“Marketers need to think about the future, but they also need to ground the conversation in what is happening today,” Lou said. “They need to think about in-app, cross-device, and how their development works with the AdChoices program — and we offer them a way to do that.”

About The Author

Jon McDonald is a contributing editor for DealCrunch with over 15 years of experience editing, writing, and designing at numerous publications. His passions include digging into emerging trends and seeking out the companies making an impact on the retail industry.

Back to IndustryCrunch