As the internet becomes the new marketplace for commerce, companies’ advertising budgets are getting redirected from traditional media (television, print, radio) towards the internet. Although the marketing principle of segmenting the market, targeting a particular segment, and positioning the product to meet the needs of the target segment still hold for internet marketing, targeting has become a significantly more advanced and controversial topic when applied to internet advertising.
A great debate is currently raging on the ethical concerns over using targeted ads based on the user’s previous website history. Simply put, a cookie is a piece of text that can be used to track the user’s previous web-site visits. A computer program analyzes the web-site history gathered by the cookie to determine which products and services would likely be purchased by the user and those ads are placed within subsequent sites. According to Whatis.com, targeted ads can have a click rate of 1-5%, much higher than the standard ads placed within websites which typically have a click rate of 0.15-1.0%. Although this technique is profitable for companies trying to sell their product, many consumer activists and even the FTC are arguing that some of the techniques used by advertisers violate the consumer’s right to privacy. Younger generations tend to value privacy less as social media sites allow them to share pictures, personal information, and updates with the entire world. This link http://www.cio-today.com/news/Web-Sites-Know-What-You-Do-Online/story.xhtml?story_id=12000DEDB220 will take you to a concise article from CIO-Today about privacy issues and what some consumer advocacy groups are trying to do to stop it.
Feel free to post any comments or opinions you have if you feel strongly one way or another about this topic
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