Targeted Advertising Faces Headwinds

Will the future of online advertising be highly targeted or not? It increasingly seems it will only be partly so. Facing presure from the Federal Trade Commission, both Google and Mozilla (Firefox browser) have introduced ways to opt out of behavioral advertising, which allows ads to be targeted.

Google's solution is an extension for its Chrome web browser that lets users proactively block certain advertisers from serving them behavioral ads. Mozilla's approach would bundle a "do not track" feature with its browser, but require websites and ad networks to agree to recognize such requests from Firefox users.

Microsoft has previously announced its own plans for letting users opt out of such ads as well. Those moves, plus any additional FTC rules, are going to limit the extent to which targeted ads can be delivered.

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People Want Behaviorally-Targeted E-mails

Few consumers ever say they "like" advertising. But most are willing to put up with it if there is some tangible reward for doing so.

Email marketing, for example, can be "spam."

But consumers say they want emails that are relevant to them. Information on sales and promotions for products the customer is interested in has been one of the most popular and easily-implemented solutions.

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Based on research e-Dialog recently completed, consumers also ranked behaviorally-targeted or 'task-based' e-mails as something they want to receive. These range from abandoned shopping cart messages to alerts from financial services companies about account balances or even reminders.

People Want Behaviorally-Targeted E-mails

Analytics is Key for All Targeted Advertising

Mobile analytics are crucial for the future of mobile advertising for drop-dead-simple reasons. The whole point of targeted and location-based marketing is that companies pay to create impressions and leads at the times when such pitches are likely to have an impact, and rarely, if ever, at other times.

That old adage about "half my advertising investment being wasted; I just don't know which half" is being challenged by targeted approaches, when it is possible to eliminate the "wasted half."

The long-term repercussions on the advertising ecosystem are hard to predict, though. One might argue that new targeting techniques will drive incrementally more spending, or incrementally less.

EU Will Study Targeted Advetising: Much Hangs in the Balance

Targeted online advertising, an important revenue driver for all sorts of media and mobile services, is going to get serious regulatory scrutiny from European Union regulators next year, according to Astrid Wendlandt, Reuters reporter. At stake is the viability and robustness of media revenue models based on targeted messages, obviously key for Web sites such as Facebook, search providers, online media companies and mobile service providers alike.

The European Union's Article 29 Working Party already has ordered Google to curtail the amount of time it stores past Web searches to 18 months.

The EU's moves are a salient reminder that Internet services, especially media and content services and applications, increasingly are falling under the purview of regulators. Some have argued that Internet communications should be free of such rules. More important are regulations affecting content and media services. Historically, regulators have decided whether communications were legal, and under what terms. Now regulators essentially will be deciding what content and media forms are legal, and under what terms. One can argue that all regulators are doing is protecting privacy. It is more than that. Regulators also will be deciding "what" the basis of a new business can be; "who" can be a part of it and "how big" new media might become.

Skirmishes over "VoIP" will pale in comparison.