program areas Digital Consumer
Program Areas
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Coalition of child advocacy, health, safety, privacy and consumer organization document how data-driven marketing undermines privacy and welfare of young peopleChildren and teenagers experience widespread commercial surveillance practices to collect data used to target them with marketing. Targeted and personalized advertising remains the dominant business model for digital media, with the marketing and advertising industry identifying children and teens as a prime target. Minors are relentlessly pursued while, simultaneously, they are spending more time online than ever before. Childrenâs lives are filled with surveillance, involving the collection of vast amounts of personal data of online users. This surveillance, informed by behavior science and maximized by evolving technologies, allows platforms and marketers to profile and manipulate children.The prevalence of surveillance advertising and targeted marketing aimed at minors is unfair in violation of Section 5. Specifically, data-driven marketing and targeted advertising causes substantial harm to children and teens by:violating their privacy;manipulating them into being interested in harmful products;undermining their autonomyperpetuating discrimination and bias;Additionally, the design choices tech companies use to optimize engagement and data collection in order to target marketing to minors further harm children and teens. These harms include undermining their physical and mental wellbeing and increasing the risk of problematic internet risk. These harms cannot reasonably be avoided by minors or their families, and there are no countervailing benefits to consumers or competition that outweigh these harms.Surveillance advertising is also deceptive to children, as defined by the Federal Trade Commission. The representations made about surveillance advertising by adtech companies, social media companies, apps, and games are likely to mislead minors and their parents and guardians. These misrepresentations and omissions are material. Many companies also mislead minors and their guardians by omission because they fail to disclose important information about their practices. These practices impact the choices of minors and their families every day as they use websites, apps, and services without an understanding of the complex system of data collection, retention, and sharing that is used to influence them online. We therefore urge the Commission to promulgate a rule that prohibits targeted marketing to children and teenagers.Groups filing the comment included: The Center for Digital Democracy, Fairplay, and #HalfTheStory, American Academy of Pediatrics, Becca Schmill Foundation, Berkeley Media Studies Group, Children and Screens: Institute of Digital Media and Child Development, Consumer Federation of America, Consumer Federation of California, CUNY Urban Food Policy Institute, Eating Disorders Coalition for Research, Policy & Action, Enough is Enough, LookUp.live, Lynnâs Warriors, National Eating Disorders Association, Parents Television and Media Council, ParentsTogether, Peace Educators Allied for Children Everywhere (P.E.A.C.E.), Public Citizen and UConn Rudd Center for Food Policy & Health FairPlay's executive director Josh Golin said: "Big Tech's commercial surveillance business model undermines young people's wellbeing and development.  It causes kids and teens to spend excessive time online, and exposes them to harmful content and advertising targeted to their vulnerabilities. The FTC must adopt a series of safeguards to allow vulnerable youth to play, learn, and socialize online without being manipulated or harmed. Most importantly, the Commission should prohibit data-driven advertising and marketing to children and teens, and make clear that Silicon Valley profits cannot come at the expense of young people's wellbeing.âCDD's Jeff Chester underscored this saying: "Children and teens are key commercial targets of todayâs data-driven surveillance complex.  Their lives are tethered to a far-reaching system that is specifically designed to influence how they spend their time and money online, and uses artificial intelligence, virtual reality, geo-tracking, neuromarketing and more to do so.  In addition to the loss of privacy, surveillance marketing threatens their well-being, health and safety. Itâs time for the Federal Trade Commission to enact safeguards that protect young people. "[full filing attached]
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Press Release
Press Statement regarding todayâs FTC Notice of Proposed Rulemaking Regarding the Commercial Surveillance and Data Security
Press Statement regarding todayâs FTC Notice(link is external) of Proposed Rulemaking Regarding the Commercial Surveillance and Data SecurityKatharina Kopp, Deputy Director, Center for Digital Democracy:Today, the Federal Trade Commission issued its long overdue advanced notice of proposed rulemaking (ANPRM) regarding a trade regulation rule on commercial surveillance and data security. The ANPRM aims to address the prevalent and increasingly unavoidable harms of commercial surveillance. Civil society groups including civil rights groups, privacy and digital rights and childrenâs advocates had previously called on the commission to initiate this trade regulation rule to address the decades long failings of the commission to reign in predatory corporate practices online. CDD had called on the commission repeatedly over the last two decades to address the out-of-control surveillance advertising apparatus that is the root cause of increasingly unfair, manipulative, and discriminatory practices harming children, teens, and adults and which have a particularly negative impact on equal opportunity and equity.The Center for Digital Democracy welcomes this important initial step by the commission and looks forward to working with the FTC. CDD urges the commission to move forward expeditiously with the rule making and to ensure fair participation of stakeholders, particularly those that are disproportionately harmed by commercial surveillance.press_statement_8-11fin.pdf -
Considering Privacy Legislation in the context of contemporary digital data marketing practices Last week, the leading global advertisers, online platforms and data marketers gathered for the most important awards given by the ad industryâthe âCannes Lions.â Reviewing the winners and the âshortlistâ of runners-upâcompeting in categories such as âCreative Data,â âSocial and Influencer,â âBrand Experience & Activation,â âCreative Commerceâ and âMobileââis essential to learn where the data-driven marketing businessâand ultimately much of our digital experiencesâis headed. An analysis of the entries reveals a growing role for machine learning and artificial intelligence in the creation of online marketing, along with geolocation tracking, immersive content and other âengagementâ technologies. One takeaway, not surprisingly, is that the online ad industry continues to perfect techniques to secure our interest in its content so it can to gather more data from us.A U.S.-based company that also generated news during Cannes was The Trade Desk, a relatively unknown data marketing service that is playing a major role assisting advertisers and content providers to overcome any new privacy challenges posed by emerging or future legislation. The Trade Desk announced last week a further integration of its data and ad-targeting service with Amazonâs cloud AWS division, as well as a key role assisting grocer Albertsons new digital ad division. The Trade Desk has brokered a series of alliances and partnerships with Walmart, the Washington Post, Los Angeles Times, Gannett, NBC Universal, and Disneyâto name only a few.There are several reasons these marketers and content publishing companies are aligning themselves with The Trade Desk. One of the most important is the companyâs leadership in developing a method to collect and monetize a personâs identity for ongoing online marketing. âUnified ID 2.0â is touted to be a privacy-focused method that enables surveillance and effective ad targeting. The marketing industry refers to these identity approaches as âcurrenciesâ that enable the buying and selling of individuals for advertising. There are now dozens of identity âgraphâ or âidentity spineâ services, in addition to UDID, which reflect far-reaching partnerships among data brokers, publishers, adtech specialists, advertisers and marketing agencies. Many of these approaches are interoperable, such as the one involving Acxiom spin-off LiveRamp and The Trade Desk. A key goal, when you listen to what these identity brokers say, is that they would like to establish a universal identifier for each of us, to directly capture our attention, reap our data, and monetize our behavior. For the last several years, as a result of the enactment of the GDPR in the EU, the passage of privacy legislation in California, and the potential of federal privacy legislation, Google, Apple, Firefox and others have made changes or announced plans related to their online data practices. So-called âthird party cookies,â which have long enabled commercial surveillance, are being abandonedâespecially since their role has repeatedly raised concerns from data-protection regulators. Taking their place are what the surveillance marketing business believes are privacy-regulation-proof strategies. There are basically two major, but related, efforts that have been underwayâhere in the U.S. and globally.The first tactic is for a platform or online publisher to secure the use of our information through an affirmative consent processâcalled a âfirst-partyâ data relationship in the industry. The reasoning goes is that an individual wants an ongoing interaction with the siteâfor news, videos, groceries, drugs and other services, etc. Under this rationale, we are said to understand and approve how platforms and publishers will use our information as part of the value exchange. First-party data is becoming the most valuable asset in the global digital marketing business, enabling ongoing collection, generating insights, and helping maintain the surveillance model. It is considered to have few privacy problems. All the major platforms that raise so many troubling issuesâincluding Google, Amazon, Meta/Facebookâoperate through extensive first-party data relationships. Itâs informative to see how the lead digital marketing trade groupâthe Interactive Advertising Bureau (IAB)âexplains it: â âfirst party data is your dataâŚpresents the least privacy concerns because you have full control over its collection, ownership and use.âThe second tactic is a variation on the first, but also relies on various forms of identity-resolution strategies. Itâs a response in part to the challenges posed by the dominance of the âwalled gardenâ digital behemoths (Google, etc.) as well the need to overcome the impact of privacy regulation. These identity services are the replacement for cookies. Some form of first-party data is captured (and streaming video services are seen as a gold mine here to secure consent), along with additional information using machine learning to crunch data from public sources and other âsignals.â Multimillion member panels of consumers who provide ongoing feedback to marketers, including information about their online behaviors, also help better determine how to effectively fashion the digital targeting elements. The Trade Desk-led UDID is one such identity framework. Another is TransUnionâs âFabrick,â which âprovides marketers with a sustainable, privacy-first foundation for all their data management, marketing and measurement needs.â Such rhetoric is typical of how the adtech/data broker/digital marketing sectors are trying to reframe how they conduct surveillance.Another related development, as part of the restructuring of the commercial surveillance economy, is the role of âdata clean rooms.â Clean rooms enable data to be processed under specific rules set up by a marketer. As Advertising Agerecently explained, clean rooms enable first-party and other marketers to provide âaccess to their troves of data.â For Comcastâs NBCU division and Disney, this treasure chest of information comes from âset-top boxes, streaming platforms, theme parks and movie studios.â Various privacy rules are supposed to be applied; in some cases where they have consent, two or more parties will exchange their first-party data. In other cases, where they may not have such open permission, they will be able to âcreate really interesting ad products; whether it's a certain audience slice, or audience taxonomy, or different types of ad unitsâŚ.â As an NBCU executive explained about its clean room activity, âwe match the data, we build custom audiencesâŚwe plan, activate and we measure. The clean room is now the safe neutral sandbox where all the parties can feel good sharing first party data without concerns of data leakage.âWe currently have at least one major privacy bill in Congress that includes important protections for civil rights and restricts data targeting of children and teens, among other key provisions. Itâs also important when examining these proposals to see how effective they will be in dealing with the surveillance marketing industryâs current tactics. If they donât effectively curtail what is continuous and profound surveillance and manipulation by the major digital marketers, and also fail to rein in the power of the most dominant platforms, will such a federal privacy promise really deliver? We owe it to the public to determine whether such bills will really âclean upâ the surveillance system at the core of our online lives.
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Blog
FTC Should tell Microsoft that itâs âGame Overâ with its plans to buy Activision Blizzard
Deal reflects Big Tech move to grab more data for omnipresent tracking & targeting Microsoft is rapidly expanding its surveillance advertising complexâfirst acquiring AT&Tâs powerful Xandr targeting system last December, and adding a few weeks later the online gaming and eSports giant Activision Blizzard. The combination of Microsoft, AT&T and Activision assets raises a set of concerns regarding competition in the gaming and eSports marketplaces; privacy/surveillance protections, given the pervasive data gathering on users; and consumer protection, such as the methods that Microsoft and Activision (and other gaming services) implement to monetize players (including youth) through in-stream advertising and other marketing efforts. It also has implications for the ways we protect privacy in streaming media as well as in the evolving âmetaverse.âThe FTC must review this proposed deal, with the agencyâs privacy and consumer-protection roles at the fore. This proposed Microsoft/Activision combination is emblematic of the ongoing transformation of how Big Tech companies track and target people across all their devices and applications. In order to continue its surveillance-advertising-based model, the online industry is undergoing a massive shift in tactics. It is pivoting to whatâs called a âFirst-Partyâ data use strategy, claiming that it is obtaining our permission to continue to follow us online and deliver personalized ads and marketing. Getting our consent is the Big Tech plan to undermine any privacy legislation in the U.S. and elsewhere. For example, if this merger goes through, users of Activision games will likely be asked to consent to data collection and tracking on all of Microsoftâs servicesâsuch as Bing and LinkedIn. Given that Microsoft and Activision have already baked into its ad services relationships with Google and Meta/Facebook, this acquisition also illustrates the numerous deals that are aligned in all of these digital giants. Owning Xandr will bring a host of additional surveillance advertising resources to Microsoftâs already robust consumer-profiling and marketing infrastructure (including information contributed by AT&Tâs own data practices). As explained in the data marketing newsletter AdExchanger, the Xandr and Activision acquisitions, if approved, will enable the leveraging of Microsoftâs already âstrong first-party data set and monetize inventory across its wide portfolio of platforms, including its video game business, LinkedIn, Bing, Edge, Office 365, Skype and more.â Microsoft was already working with AT&Tâs Xandr surveillance ad targeting apparatus, including for its gaming division. For example Xandr explains that its enables marketers to âAccess real users in immersive and engaging environmentsâ via its current ability to target people thru the Microsoft Advertising Exchange.Microsoftâs data targeting currently involves its âMicrosoft Search Network,â which âsees 14.6 billion monthly searches globally across nearly 700 million users. Its Audience Network engages in an array of targeting tactics, including via leveraging a personâs identity, location, use of LinkedIn or other sites and a variety of âcustomâ approaches. Advertisers are able to âtarget audiencesâŚacross more than 1 billion Window devices.â Microsoft also offers its âDynamics 365 Customer Insightsâ data platform to help marketers package their own data to use on its ad platform. Activision engages in an array of ad practices that raise concerns about unfairness and privacy, from in-stream ads to ârewarded videosâ to product placement. As it explains, âActivision Blizzard Media connects brands and players with fan-first integrated advertising experiences across gaming and esportsâŚ. We create user-initiated in-game advertising experiences that allow brands to reward 245M+ players at key moments of gameplay to drive reach, frequency and engagementâŚ. In-game User-initiated video ads allow brands to reward players at key moments of gameplay.âIn this context, the FTC needs to review all the third-party tracking YouTube-related companies serving ads to Activision Blizzard Esports, including Google Campaign Manager 360, Flashtalking, Adform, Innovid and Extreme Reach. For example, Flashtalking explains that it helps gaming services âdrive customer lifetime valueâŚ, understand who bought your games, how they interact with your brand, and which touch points drove engagement.â Innovid helps marketers create âaccurate, persistent identity across devices.â For measurement, which is also a privacy issue long overlooked by previous FTC commissions, we have Activision partners that include Oracleâs MOAT, Kantor, Google Campaign Manager, and others. Everything from potato chips, candy and toilet paper is pushed via its gaming services. Activision uses neuromarketing and other research-related online ad industry tactics to figure out how best to deliver marketing to its users (including teens)âall of which have privacy and consumer protection implications. For decades, the Federal Trade Commission has approved Big Tech mergers without examining their impact on consumer protection and privacy (and also on competitionâthink of all the Google and Facebook takeovers the commission has okayed). This is unacceptable. Gaming is a hugely important market, with a set of data-gathering tactics that impact both consumers and competition. We expect this FTC to do much better than what we have witnessed for the past several decades. -
Microsoft's further expansion into gaming, data gathering, digital marketing must trigger close scrutiny, inc. impacts on gamers, youth Microsoftâs proposed purchase of Activision-Blizzard raises serious red flags, Public Citizen, the Center for Digital Democracy, the Repair Association, the Communications Workers of America, and 11 additional groups said today in a letter to the Federal Trade Commission (FTC). The merger could give Microsoft an unfair amount of market power, threaten data privacy and security, limit consumersâ and independent businessâ right to repair game consoles, and lead to union busting and wage suppression, the groups said.âIf the FTC clears this merger, Microsoft will become the third largest gaming company in the world,â the letter reads. âThe proposed merger fits an alarming pattern of concentration in the gaming industry over the past several years. Microsoftâs expanding role in the gaming market may result in the company using its leverage to raise subscription prices and limit options, among other possible consumer harms.âIn January, Microsoft announced its deal to buy game publisher and developer Activision-Blizzard, subject to FTC approval. Activision is a titan of the gaming world, boasting 400 million monthly active users and incredibly popular titles like Call of Duty. Microsoft already is a major player in gaming as a hardware producer, platform provider, and game distributor. Combining the two companies could lessen competition in a market thatâs seen a rash of consolidation in recent years.Workers at Activision have mobilized over the past year to shine a light on an abusive workplace culture. Now, as these workers seek to form a union to address their collective interests, the potential takeover by Microsoft threatens to further undermine workersâ rights and suppress wages.Microsoftâs move also has negative implications for data privacy and surveillance advertising. Adding Activisionâs roster of game titles opens opportunities for advanced data collection, including the use of AI, influencers, neuromarketing, and other practices now used for its gaming operations.Additionally, the merger could strengthen Microsoftâs power to impinge on consumersâ right to repair their own video game equipment or to have it repaired by a service provider of their choice. Microsoftâs Xbox platform is already notoriously difficult to independently repair.
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The European Unionâs efforts to legislate digital markets, specifically with its Digital Markets Act (DMA), make them fairer and more open, and benefit consumers. See PDF of full letter below. 20220203-letter-digital_markets_act-president-joe-r-biden.pdf
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Documents 25 years of failures by agency to rein in practices that have eviscerated privacy and consumer protection in the U.S. and globallyThe Center for Digital Democracy (CDD) urges the Federal Trade Commission to develop a comprehensive set of rules to address a problem largely of its own makingâthe unfettered growth of commercial âsurveillance marketing.â We submit this comment based on the nearly 25-year record of CDD and its key consumer-protection and privacy colleagues, providing detailed documentation and analysis of the need for the commission to regulate what is known as behavioral, programmatic and surveillance-based advertising.[1]The systemic and multiple failures of the FTC over the decades to respond meaningfully to the role and nature of online marketingâwhich has eviscerated the privacy rights of Americans (and consumers worldwide)âhave enabled data-driven surveillance to thrive ubiquitously. Nearly every platform, application, device and experience in which Americans engage has been shaped by the commercial spying and manipulation apparatus that the commission has allowed to evolve and expand without constraint. In addition, by long ignoring the impact that the approval of countless mergers and acquisitions involving leading digital marketing companies had on commercial surveillance operations, the commission and Department of Justice have helped foster an online marketplace that is dominated by a few giants. There is no real competition in terms of how Americans are treated in the online surveillance marketing economy. Google, Meta/Facebook, Amazon and their partners set the global standards for how everyone else has to conduct data and digital marketing operations. FTC inaction on commercial surveillance practices has perversely promoted the widespread adoption of these practices. Today, nearly every major company is a big-data-driven information broker, surveillance advertiser, and real-time targeter of consumers.[2]At each critical momentâthe expansion of behavioral advertising; the emergence of mobile marketing; the widespread adoption of programmatic, real-time, algorithmic-driven buying and selling of people for targeting ads; the deployment of omnichannel (cross-device) tracking and targeting; and the widespread integration of artificial intelligence and machine learning to deliver enhanced predictive targetingâthe failure of the FTC to challenge the online data-driven model sent a message to the commercial surveillance industry, that it faced no serious regulatory or political consequences for its actions. This included regulatory immunity for the host of manipulative elements that are within the foundation of commercial surveillance, such as the deep analysis of a personâs emotions, interests, relationships, location, income, race, and ethnicity. By acting as an âenablerâ to the forces that have shaped our online platform and experiences, the commission has done more than harm consumer protection, privacy and competition. It is also responsible for allowing the online platform marketplace to grow in ways that have undermined democracy, at once diminishing civic discourse, enabling efforts to promote voter suppression, and facilitating the communication and spread of hate speech and uncivil acts, among other major harms. FTCââEyes Wide Shutâ: The commission has been engaged in risk-averse behaviors since the early 1980s, as a reaction to the successful attacks on it by the advertising lobby, which was able to convince Congress that the agency had engaged in regulatory excess when it tried to protect children from the harmful impact of marketing. The legacy of what is known as the âkidvidâ episode, which resulted in a significant loss of its rulemaking authority, has permeated the agencyâs operations for decades. It unleashed a âdonât ask, donât tellâ approach at the commission when it came to seriously confronting the impact of the digital marketplace on the public. Even when it came to childrenâs privacyâthe one area where advocates had successfully convinced Congress to give the agency rulemaking authorityâthe agency repeatedly failed to enforce the law (allowing Googleâs YouTube, for example, to openly violate COPPA for years, despite hearing repeatedly from advocates that it was doing so). The failure of the FTC to seriously implement its only congressionally mandated data-privacy law also sent a loud message to the data surveillance business that the commission wasnât to be taken seriously.The commission has never condemned the online surveillance model developed by the digital marketing industry. It had countless opportunities to challenge behavioral ads, mobile and geo-location surveillance, social media profiling, and real-time buying and selling of individual profiles for the purposes of micro-targeted advertising.[3] In this comment, we will briefly highlight how the FTC has been an âenablerâ of the unfettered operations of surveillance advertising, despite the many calls by CDD and its allies for the agency to act. The FTC and the Information Superhighway: At the earliest stages of what was then called the âInformation Superhighway,â cyberspace, or the âNational Information Infrastructure,â the FTC convened multiple âworkshopsâ focused on privacy and related ecommerce issues. Reflecting the priorities of the then-Clinton administration, the commission spent several years imploring marketers to implement a set of âfair information practiceâ principles.[4]During this time, a number of consumer and privacy advocates urged the commission to call on Congress to regulate online data marketing practices. It was evident even thenâespecially to those who had tracked the online marketing business during the âdial-upâ era, that privacy was not a priority at all for the marketing industry. The self-regulatory system was a total sham.[5]The lone exception to self-regulation was a data privacy law covering children 12 and under, an issue that this NGOâs predecessor group, the Center for Media Education (along with the Consumer Federation of America and the Institute for Public Representation, Georgetown University Law Center) championedâwhich led to the enactment of the Childrenâs Online Privacy Protection Act in 1998.[6]By the time the commission finally recommended (in 2000) that Congress enact privacy legislation âto supplement self-regulatory efforts and guarantee basic consumer protections,â the political winds had changed. There would be no further progress from Congress on privacy, given the clout of the big data marketing lobby.[7]Enabling behavioral advertising: In 2006, CDD and U.S. PIRG filed a complaint with the commission calling on it to use its Section 5 power to protect consumer privacy online. Specifically, we asked the commission to conduct an investigation of online advertising practices, focusing on five areas of concern: User Tracking/Web Analytics, Behavioral Targeting, Audience Segmentation, Data Gathering/Mining, and Industry Consolidation. As we explained in our petition, âCollectively, these five areas represented the foundations of an entirely new online environment, one in which engagement gives way to entrapment, in which personalization impinges on privacy.â The complaint discussed in detail all the methods used to track and target consumers, via their personal data, mobile phone use, and much more. It also urged action on the growing consolidation of what is now called the platform or ad-tech industry, explaining thatThe past few years have witnessed an alarming degree of consolidation in the Web analysis, advertising, and Internet data collection industries. The result of these transactions is not only the concentration of power in fewer hands, but also an increased ability, as our complaint has shown, for these companies to use their massive compilations of user data to violate consumer privacy in the U.S. Such consolidation within the core of the online marketing infrastructure also requires the FTC to conduct an anti-trust analysis to determine whether there is undue market power in this sector.[8]Ignoring the structure and consequences of behavioral advertising: In part due to the opposition to the proposed Google acquisition of DoubleClick that CDD, EPIC, U.S. PIRG and its allies in the U.S. and in the EU generated (discussed below), the commission convened several workshops, town halls and other forums focused on privacy and online data marketing. As CDDâs executive director, at the FTCâs 2007 âEhavioral Advertising: Tracking, Targeting & Technologyâ event, warned, I just want to underscore that the future of online advertising has profound consequences for the future of our democracy and democracies everywhere. The kind of society we are creating right now for ourselves, and particularly our children, in many ways, is being shaped by the forces of advertising and marketing.... [W]eâve watched since 2000 the ever-growing sophisticated array of techniques that had been deployed to track our every move, not just on individual websites, but through the development of new approaches called re-targeting where we were becoming digitally shadowed wherever we went, site to siteâŚ. [T]he time for fact-finding is over. The Commission is the designated Federal agency which is supposed to safeguard consumer privacy. It must act now to protect Americans from the unfair and deceptive practices that have evolved as part of what the industry calls the digital interactive marketing system.[9]Endorsing the monopolistic âSurveillance Marketplaceâ: In 2007, EPIC, U.S. PIRG, and CDD filed a complaint opposing plans by Google to acquire DoubleClick. As our initial filing explained, the acquisition, if approved, âwill give one company access to more information about the Internet activities of consumers than any other company in the world.â In a supplemental petition, we explained that âthe massive quantity of user information collected by Google coupled with DoubleClickâs business model of consumer profiling will enable the merged company to construct extremely intimate portraits of its usersâ behavior.â We also identified a major conflict of interest at the commission regarding this deal. Needless to say, it was approved anyway, paving the way for the unprecedented role that Google now plays in our lives, with its domination of the commercial surveillance marketplace.[10] (CDD also raised objections to the Google/AdMob, Facebook/Instagram/WhatsApp, and other big-data-driven mergers that the FTC failed to address, again paving the way for the contemporary commercial surveillance apparatus).[11]Mobile surveillance: In 2009, CDD and U.S. PIRG urged the commission to âto protect consumers from a growing number of deceptive and unfair marketing practices and the resultant threats to consumer privacy that are a part of the rapidly growing U.S. mobile advertising landscapeâŚ. [M]obile devices, which know our location and other intimate details of our lives, are being turned into portable behavioral tracking and targeting toolsâŚ.â The groupâs FTC filing cited a Google official who called the mobile phone âthe ultimate ad vehicle. Itâs the first one ever in the history of the planet that people go to bed with. Itâs ubiquitous across the world, across demographics, across age groups. People are giving these things to ever-younger children for safety and communicationâŚ. [I]t can know where youâve been, where youâve lingered, what store you stopped in, what car dealership you visited. It goes beyond any traditional advertising....â The complaint also discussed the myriad techniques, tactics, mergers and other critical issues to support the commissionâs investigation and action.[12]Yet the FTC did nothing, and geolocation-based surveillance marketing has thrived, including via the leading platforms. Nor has the commission challenged cross-device tracking, a component of the surveillance marketing industry that financially benefited from the agencyâs inability to protect consumer privacy, as unique identifiers are used to track and target the public.[13]Real-time programmatic, behavioral and algorithmic-based targeting: Also in 2009, CDD and U.S. PIRG submitted to the commission a comment as part of the agencyâs âPrivacy Roundtableâ process, which noted thatToday, consumers online face the rapid growth and ever-increasing sophistication of the various techniques advertisers employ for data collection, profiling, and targeting across all online platforms. The growth of ad and other optimization services for targeting, involving real-time bidding on ad exchanges; the expansion of data collection capabilities from the largest advertising agencies (with the participation of leading digital media content and marketing companies); the increasing capabilities of mobile marketers to target users via enhanced data collection; and a disturbing growth of social media surveillance practices for targeted marketing are just a few of the developments the commission must address. But despite technical innovation and what may appear to be dramatic changes in the online data collection/profiling/targeting market, the commission must recognize that the underlying paradigm threatening consumer privacy online has been constant since the early 1990âs. So-called âone-to-one marketing,â where advertisers collect as much as possible on individual consumers so they can be targeted online, remains the fundamental approach. âŚAdvertisers and marketers have developed an array of sophisticated and ever-evolving data collection and profiling applications, honed from the latest developments in such fields as semantics, artificial intelligence, auction theory, social network analysis, data-mining, and statistical modeling. Behavioral targeting is just one tool in the interactive advertisersâ arsenal.... We are being intensively tracked on many individual websites and across the Internet.[14]The filing called for action to address the buying and selling of individuals via online ad exchanges and giants such as Google; identified many other leading companies and practices; and explained how all of this was affecting mobile-device and social media users. It documented how self-regulation had been a failure, and how the âself-learning of contemporary interactive ad systemsâ threaten privacy and consumer welfare. Again, the FTC ignored these issues, enabling todayâs programmatic (surveillance marketing) system to evolve unchallenged. Surveillance marketing of health behaviors, including through social media: In 2010, CDD and allied consumer and privacy groups filed a petition on the role that behavioral advertising, as well as manipulative ad tactics such as âneuromarketing,â play in the promotion of health and medical products. Google, Microsoft, and others were the subjects of this complaint. As we explained,A far-reaching complex of health marketers has unleashed an arsenal of techniques to track and profile consumers, including so-called medical âcondition targeting,â to eavesdrop on their online discussions via social media data mining; to collect data on their actions through behavioral targeting; to use viral and so-called âword-of-mouthâ techniques online to drive interest in prescriptions, over-the counter drugs, and health remedies; and to influence their subconscious perceptions via pharma-focused âneuromarketingâŚ. Digital marketing raises many distinct consumer protection and privacy issues, including an overall lack of transparency, accountability and personal control, which consumers should have over data collection and the various interactive applications used to track, target, and influence them online (including on mobile devices). The use of these technologies by pharmaceutical, health product, and medical information providers that directly affect the public health and welfare of consumers requires immediate action.[15]As before, the FTC did nothing. Failures with Google and Facebook consent-decree enforcement: EPIC, CDD and allied consumer and privacy organizations, which helped bring cases against Google and Facebook, repeatedly told high-level commission staff and commissioners that these entities were routinely violating their respective consent decrees.[16] The failure of the commission to enforce its own decreesâreflecting the inability of the agency to analyze contemporary digital data and online marketing practicesâpermitted these companies, and the industry as a whole, to expand their surveillance capabilities still further.Neglecting communities of color: CDD also has repeatedly urged the commission to investigate and address how racial and ethnic data are used to target individuals and groups. For years, such data have been used to subject these communities to unfair treatment through predatory online marketing and other harmful practices. At best, the agency has given lip-service to these issues in the past, but has yet to take any meaningful action.[17]Failing our children, COPPA enforcement, and teens: CDD (along with Fair Play and Common Sense Media) is also filing comments in this docket on these issues. But we want to underscore that despite our repeated calls for action, the commission has never done anything to protect adolescents. Consequently, when someone turns 13 in the U.S., they are swept into the commercial surveillance marketing system that negatively affects every adult in the U.S.[18]Where we are today: Every day brings advances in the capabilities of commercial surveillance, led by the giant entities that dominate the marketplace, along with their affiliates. As we noted earlier, AI and machine-learning-based data analytic and targeting operations are routine for the commercial surveillance apparatus. And now the industry is poised to add what is known as âemotional intelligence,â a sophisticated new enhancement to ascertain and âunderstand how people feel in order to make AI more emotionally aware. There will be a shift from passive and grey interaction with AI, to an understanding of not only the cognitive, but also the emotive, channels of human interaction.â[19] Surveillance applications are also shaping the Internet of Things, the metaverse, and âover-the-topâ streaming video as well.[20]We urge the commission to act on this petition, as well as calls by civil rights, consumer and privacy groups that it engage in a comprehensive rulemaking that will help promote competition, data protection, fairness and civil rights online. [1] We especially want to single out two individuals whose leadership role in all these years has been so critical, including with the FTC. Marc Rotenberg, who created and led the Electronic Privacy Information Center for decades, has been at the forefront of these and other key digital democracy issues since the earliest days of the internet. Ed Mierzwinski, now senior director, Federal Consumer Program, U.S. PIRG, understood that the same commercial forces that had undermined consumer rights in the âanalogâ world was doing so online as well. [2] So-called consumer data platforms and similar technologies permeate the corporate environment. See, for example, Mariah Cooper, âPepsiCo Launches Data Practice to Help Food and Beverage Retailers Grow,â Campaign, 9 Sept. 2021, /article/pepsico-launches-data-practice-to-help-food-and-beverage-retailers-grow/472436; Josh Wolf, âWhere Does a Customer Data Platform Fit in With My AWS Data Lake?â AWS Blog, 13 May 2021, /blogs/apn/where-does-a-customer-data-platform-fit-in-with-my-aws-data-lake/; Wavicle Data Solutions, âGlobal QSR Uses Micro-segmentation to Improve Customer Engagement and Sales,â Dec. 2020, /wp-content/uploads/2020/12/Quick_Service_Restaurant_Customer_360_032421.pdf. [3] Federal Trade Commission, âPrivacy in the Electronic Age,â The Privacy & American Business Conference, Washington, D.C., 1 Nov. 1995, /public-statements/1995/11/privacy-electronic-age.[4] Federal Trade Commission, âStaff Report: Public Workshop on Consumer Privacy on the Global Information Infrastructureâ Dec. 1996, /reports/staff-report-public-workshop-consumer-privacy-global-information-infrastructure; Federal Trade Commission, About Privacy: Protecting the Consumer on the Global Information Infrastructure,â 8 Dec. 1998, /public-statements/1998/12/about-privacy-protecting-consumer-global-information-infrastructure; âPrivacy in the Electronic Age.â See also Jeff Chesterâs comments in U.S. Department of Commerce and Federal Trade Commission, âPublic Workshop on Online Profiling, Washington, D C, 8 Nov. 1999, /sites/default/files/documents/public_events/online-profiling-public-workshop/online.pdf. [5] See especially the digital marketing industry fundamental paradigm laid out in Don Peppers and Martha Rogers, The One to One Future (New York: Crown Business, 1993); see also, Jeff Chester, Digital Destiny: New Media and the Future of Democracy (New York: The New Press, 2008). [6] See, for example, Federal Trade Commission, âPrivacy Online: A Report to Congress,â June 1998. /sites/default/files/documents/reports/privacy-online-report-congress/priv-23a.pdf; Federal Trade Commission, âFTC Staff Sets Forth Principles For Online Information Collection From Childrenâ 16 July 1997, /news-events/press-releases/1997/07/ftc-staff-sets-forth-principles-online-information-collection. To better understand the campaign developed to enact COPPA, including the industry pushback on teens, see Kathryn C. Montgomery, Generation Digital: Politics, Commerce, and Childhood in the Age of the Internet (Cambridge, MA: 2007). CDD pressed to have âcookiesâ and other identifiers included as personal information under COPPA. Jeff Chester, âLeading Consumer, Privacy, Child Advocacy & Public Health Groups Call on FTC for Stronger Children's Privacy Safeguards Under COPPA,â Center for Digital Democracy, 25 Sept. 2012, /content/leading-consumer-privacy-child-advocacy-public-health-groups-call-ftc-stronger-childrens. [7] See, for example, Marc Rotenberg, letter to Sen. Jay Rockefeller, Chairman of the Senate Committee of Commerce, Science and Transportation, et al, 5 May 2010, /wp-content/uploads/privacy/facebook/EPIC_FB_FTC_Complaint_Letter.pdf.[8] Jeff Chester and Ed Mierzwinski, âComplaint and Request for Inquiry and Injunctive Relief Concerning Unfair and Deceptive Online Marketing Practices,â Federal Trade Commission, 1 Nov.2006, /sites/default/files/FTCadprivacy_0_0.pdf. CDD and U.S. PIRG filed a supplemental petition a year letter, which included an analysis of advances in behavioral marketing, including through the DoubleClick Advertising Exchange, among others. While the commission staff and commissioners made various proposals, there was no real attempt to address the surveillance ad system. See, for example, , âA Preliminary FTC Staff Report on Protecting Consumer Privacy in an Era of Rapid Change: A Proposed Framework for Businesses and Policymakers,â Dec. 2010, /reports/preliminary-ftc-staff-report-protecting-consumer-privacy-era-rapid-change-proposed-framework.[9] Federal Trade Commission, âEhavaorial Advertising: Tracking, Targeting & Technology,â meeting transcript, 1 Nov. 2007, pp. 35-36, /sites/default/files/documents/public_events/ehavioral-advertising-tracking-targeting-and-technology/71101wor.pdf. See also, Chesterâs comment that âA very sophisticated commercial surveillance system has been put in place,â in Louise Story, âF.T.C. to Review Online Ads and Privacy,â New York Times, 1 Nov. 2007, /2007/11/01/technology/01Privacy.html. [10] Jeff Chester, âCDD, EPIC, USPIRG Opposition to Google/Doubleclick âBig Dataâ Merger,â Center for Digital Democracy, 11 Sept. 2019, /article/cdd-epic-uspirg-opposition-googledoubleclick-big-data-merger; Roy Mark, âFTC Chairâs Impartiality Questioned,â eWeek, 13 Dec. 2007, /news/ftc-chair-s-impartiality-questioned/; âConflict of Interest in Google-Doubleclick Merger Review,â EPIC.org, /documents/epic-v-federal-trade-commission/. [11] Tom Krazit, âConsumer Groups Urge Block of Google-AdMob Deal,â CNET, 28 Dec. 2009, /news/consumer-groups-urge-block-of-google-admob-deal/; Jeff Chester, âEPIC and CDD file âUnfair and Deceptiveâ Practices Complaint at FTC on Facebook/WhatsApp Deal: WhatsApp Users Were Promised Privacy/Now They Will Have Facebook,â Center for Digital Democracy, 6 Mar. 2014, /content/epic-and-cdd-file-unfair-and-deceptive-practices-complaint-ftc-facebookwhatsapp-deal; Jeff Chester, âBig Data Gets Bigger: Consumer and Privacy Groups Call on FTC to Play Greater Role in Data Mergers/Investigation and Public Workshop Needed,â Center for Digital Democracy, 6 Feb. 2015, /content/big-data-gets-bigger-consumer-and-privacy-groups-call-ftc-play-greater-role-data-mergers.[12] âConsumer Groups Petition Federal Trade Commission to Protect Consumers from Mobile Marketing Practices Harmful to Privacy: Complaint Documents the Migration of Data Tracking, Profiling and Targeting to Mobile Phone Devices,â Center for Digital Democracy, 13 Jan. 2009, /mobile-marketing-harmful.[13] Center for Digital Democracy, âTen Questions that the Federal Trade Commission Should Answer on Cross Device Online Tracking of Individuals,â /system/files/documents/public_comments/2015/11/00061-99851.pdf. For a current example of such tracking, see, for example, LiveRamp, âMeasurement: Omnichannel Identity Linking,â /our-platform/cross-channel-measurement/omnichannel-identity-linking/. [14] Center for Digital Democracy and U.S. PIRG, âCookie Wars, Real-Time Targeting, and Proprietary Self Learning Algorithms: Why the FTC Must Act Swiftly to Protect Consumer Privacy,â FTC Privacy Roundtables â Comment, Project No. P095416, 4 Nov. 2009, /sites/default/files/documents/public_comments/privacy-roundtables-comment-project-no.p095416-544506-00013/544506-00013.pdf. [15] Center for Digital Democracy, U.S. PIRG, Consumer Watchdog, and the World Privacy Forum, âComplaint, Request for Investigation, Public Disclosure, Injunction, and Other Relief: Google, Microsoft, QualityHealth, WebMD, Yahoo, AOL, HealthCentral, Healthline, Everyday Health, and Others Named Below,â FTC filing, 23 Nov. 2010, /sites/default/files/public/2015/101123publiccmptdigitaldemocracy.pdf. This complaint was one of several where CDD also placed a spotlight on social media marketingâanother area in which the commission has repeatedly failed. For example, the complaint noted that ânew surveillance tools have been developed to monitor conversations among social network users to identify what is being said about a particular issue or product. Marketers then work to insert brand-related messages into the social dialogue, often by identifying and targeting individuals considered brand âloyalistsâ or âinfluencersâŚ.â Increasingly, advertisers are using Facebookâs marketing apparatusâwhich is largely invisible to its usersââŚto ⌠connect to the social communications of a very large pool of consumers.â [16] See, for example, Center for Digital Democracy, âFacebookâs Misleading Data and Marketing Policies and Practices,â Oct. 2013, /sites/default/files/field/public-files/2019/ftcfacebookdatapracticesfinal1013.pdf.[17] See for example, Jeff Chester, âDigital Target Marketing to African Americans, Hispanics and Asian Americans: A New Report,â Center for Digital Democracy,18 Feb. 2013, /content/digital-target-marketing-african-americans-hispanics-and-asian-americans-new-report; Center for Digital Democracy, âIn the Matter of âPrivacy and Security Implications of the Internet of Things,â FTC public workshop filing, 1 June 2013, /sites/default/files/documents/public_comments/2013/07/00006-86145.pdf; Jeff Chester, Kathryn Montgomery, and Lori Dorfman, âAlcohol Marketing in the Digital Age,â May 2010, /sites/default/files/documents/public_comments/alcohol-reports-project-no.p114503-00014%C2%A0/00014-58260.pdf.[18] âChildren's Online Privacy.â C-Span, 17 Oct. 2018, /video/?453170-1/childrens-online-privacy; Center for Digital Democracy, âDigital Youth,â /projects/focus/digital-youth.[19] Yasmin Borain, âMarketing Trends for 2022: Technology, Artificial Intelligence and Internet of Things,â WARC, Nov. 2021, /content/article/warc-exclusive/marketing-trends-for-2022-technology-artificial-intelligence-and-internet-of-things/141212 (subscription required).[20] Hannah Murphy, âFacebook Patents Reveal How It Intends to Cash in on Metaverse: Meta Hopes to Use Tiny Human Expressions to Create Virtual World of Personalised Ads,â Financial Times, 17 Jan. 2022, /content/76d40aac-034e-4e0b-95eb-c5d34146f647 (subscription required).surveillanceadvertisingftccdd012622b.pdf
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Congresswomen Anna G. Eshoo (D-CA) and Jan Schakowsky (D-IL) and Senator Cory Booker (D-NJ) Introduce Bill to Ban Surveillance AdvertisingWashington, DC 1-18-2022âIdentifying, tracking, discriminating, sorting, targeting, and manipulating online users lies at the heart of all that is toxic about todayâs digital world. Surveillance advertising drives discrimination and compounds inequities, it destroys democratic institutions and rights, strengthens monopoly power of Big Tech platforms, and is harmful to children, teens, families, and communities. If enacted, the Banning Surveillance Advertising Act would put a stop to surveillance advertising and would be an important first step in building a digital world that is less toxic to our democracy, economy, and collective well-being,â said Katharina Kopp, Ph.D., Director of Policy for the Center for Digital Democracy.Click here for statements of support.Click here for bill text.Click here for a section-by-section summary.Click here for additional background.
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Blog
The Big Data Merger Gold Rush to Control Your âIdentityâ Information
Will the DoJ ensure that both competition and consumer protection in data markets are addressed?
There is a digital data âgold rushâ fever sweeping the data and marketing industry, as the quest to find ways to use data to determine a personâs âidentityâ for online marketing becomes paramount. This is triggered, in part, by the moves made by Google and others to replace âcookiesâ and other online identifiers with new, allegedly pro-privacy data-profiling methods to get the same results. Weâve addressed this privacy charade in other posts. In order to better position themselves in a world where knowing who we are and what we do is a highly valuable global currency, there are an increasing number of mergers and acquisitions in the digital marketing and advertising sector.For example, last week data-broker giant TransUnion announced it is buying identity data company Neustar for $3.1 billion dollars, to further expand its âpowerful digital identity capabilities.â This is the latest in TransUnionâs buying spree to acquire data services companies that give it even more information on the U.S. public, including what we do on streaming media, via its 2020 takeovers of connected and streaming video data company Tru Optik (link is external) and the data-management-focused Signal. (link is external)In reviewing some of the business practices touted by TransUnion and Neustar, itâs striking that so little has changed in the decades CDD has been sounding the alarm about the impacts data-driven online marketing services have on society. These include the ever-growing privacy threats, as well as the machine-driven sorting of people and the manipulation of our behaviors. So far, nothing has derailed the commercial Big Data marketing.With this deal, TransUnion is obtaining a treasure trove of data assets and capabilities. For Neustar, âidentity is an actionable understanding of who or what is on the other end of every interaction and transaction.â Neustarâs âOneID system provides a single lens on the consumer across their dynamic omnichannel journey.â This involves: (link is external) data management services featuring the collection, identification, tagging, tracking, analyzing, verification, correcting and sorting of business data pertaining to the identities, locations and personal information of and about consumers, including individuals, households, places, businesses, business entities, organizations, enterprises, schools, governments, points of interest, business practice characteristics, movements and behaviors of and about consumers via media devices, computers, mobile phones, tablets and internet connected devices.Neustar keeps close track of people, saying that it knows that âthe average person has approximately 15 distinct identifiers with an average of 8 connected devicesâ (and notes that an average household has more than 45 such distinct identifiers). Neustar has an especially close business partnership with Facebook, (link is external) which enables marketers to better analyze how their ads translate into sales made on and spurred by that platform. Its âCustomer Scoring and Segmentationâ system enables advertisers to identify and classify targets so they can âreach the right customer with the right message in the right markets.â Neustar has a robust data-driven ad-targeting system called AdAdvisor, which reaches 220 million adults in âvirtually every household in the U.S.â AdAdvisor (link is external) âuses past behavior to predict likelihood of future behaviorâ and involves âthousands of data points available for online targetingâ (including the use of â2 billion records a month from authoritative offline sourcesâ). Its âPropensity Audiencesâ service helps marketers predict the behaviors of people, incorporating such information (link is external) as âcustomer-level purchase data for more than 230 million US consumers; weekly in-store transaction data from over 4,500 retailers; actual catalog purchases by more than 18 million householdsâ; and âcredit information and household-level demographics, used to build profiles of the buying power, disposable income and access to credit a given household has available.â Neustar offers its customers the ability to reach âpropensity audiencesâ in order to target such product categories as alcohol, automotive, education, entertainment, grocery, life events, personal finance, and more. For example, companies can target people who have used their debit or credit cards, by the amount of insurance they have on their homes or cars, by the âlevel of investable assets,â including whether they have a pension or other retirement funds. One also can discover people who buy a certain kitty litter or candy barâthe list of AdAdvisor possibilities is far-reaching.Another AdAdvisor application, âElementOne,â (link is external) comprises 172 segments that can be âleveraged in real time for both online and offline audience targeting.â The targeting categories should be familiar to anyone who is concerned about how groups of people are characterized by data-brokers and others. For example, one can select âSegment 058âhigh income rural younger renters with and without childrenâor âSegment 115âmiddle income city older home owners without children; or any Segment from 151-172 to reach âlow incomeâ Americans who are renters, homeowners, have or donât have kids, live in rural or urban areas, and the like.Marketers can also use AdAdvisor to determine the geolocation behaviors of their targets, through partnerships that provide Neustar with â10 billion daily location signals from 250+ million opted-in consumers.â In other words, Neustar knows whether you walked into that liquor store, grocery chain, hotel, entertainment venue, or shop. It also has data on what you view on TV, streaming video, and gaming. And itâs not just consumers who Neustar tracks and targets. Companies can access its âHealthLink Dimensions Doctor Data to target 1.7 million healthcare professionals who work in more than 400 specialties, including acute care, family practice, pediatrics, cardiovascular surgery.âTransUnion is already a global data and digital marketing powerhouse, with operations in 30 countries, 8,000 clients that include 60 of the Fortune 100. What is calls its âTruAudience Marketing Solutions (link is external)â is built on a foundation of âinsight into 98% of U.S. adults and more than 127 million homes, including 80 million connected homes.â Its âTruAudience Identityâ product provides âa three-dimensional, omnichannel view of individuals, devices and households⌠[enabling] precise, scalable identity across offline, digital and streaming environments.â It offers marketers and others a method to secure what it terms is an âidentity resolution,â (link is external) which is defined as âthe process of matching identifiers across devices and touchpoints to a single profile [that] helps build a cohesive, omnichannel view of a consumerâŚ.âTransUnion, known historically as one of the Big Three credit bureaus, has pivoted to become a key source for data and applications for digital marketing. It isnât the only company expanding what is called an âID Graf (link is external)ââthe ways all our data are gathered for profiling. However, given its already vast storehouse of information on Americans, it should not be allowed to devour another major data-focused marketing enterprise.Since this merger is now before the U.S. Department of Justiceâas opposed to the Federal Trade Commissionâthere isnât a strong likelihood that in addition to examining the competitive implications of the deal, there will also be a focus on what this really means for people, in terms of further loss of privacy, their autonomy and their potential vulnerability to manipulative and stealthy marketing applications that classify and segment us in a myriad of invisible ways. Additionally, the use of such data systems to identify communities of color and other groups that confront historic and current obstacles to their well-being should also be analyzed by any competition regulator.In July, the Biden Administration issued (link is external) an Executive Order on competition that called for a more robust regime to deal with mergers such as TransUnion and Neustar. According to that order, âIt is also the policy of my Administration to enforce the antitrust laws to meet the challenges posed by new industries and technologies, including the rise of the dominant Internet platforms, especially as they stem from serial mergers, the acquisition of nascent competitors, the aggregation of data, unfair competition in attention markets, the surveillance of users, and the presence of network effects.âWe hope the DOJ will live up to this call to address mergers such as this one, and other data-driven deals that are a key reason why these kind of buyouts happen with regularity. There should also be a way for the FTCâespecially under the leadership of Chair Lina Khanâto play an important role evaluating this and similar transactions. Thereâs more at stake than competition in the data-broker or digital advertising markets. Who controls our information and how that information is used are the fundamental questions that will determine our freedom and our economic opportunities. As the Big Data marketplace undergoes a key transition, developing effective policies to protect public privacy and corporate competition is precisely why this moment is so vitally important. -
Blog
Who is Really âPushingâ Your Online Shopping Cart as You Buy Groceries? Itâs Big Data, Machine Learning and Lots of Cash from Advertisers
The FTC and States Should Investigate âGrocery Techâ
Online grocery shopping became a pandemic response necessity for those who could afford it, with revenues to exceed $100 billion (link is external) in 2021. Leading supermarket chains such as Kroger, big box stores like Walmart, online specialist companies such as Instacart, and the ubiquitous Amazon, have all experienced greater demand from the public to have groceries ordered and then quickly delivered or available for pick up. The pandemic has spurred ârecordâ (link is external) downloads of grocery shopping apps from Instacart, Walmart Grocery and Target, among others. Consequently, this marketplace is now rapidly expanding its data collection and digital marketing operations, to generate significant revenues from advertisers and food and beverage brand sponsors.So itâs not a surprise that Instacartâs new (link is external) CEO comes from Facebook (link is external), and the company has also just hired that social networkâs former head of advertising. Walmart, Kroger, Amazon and others are also further adding (link is external) adtech and data marketing experts. There has been a spate of announcements involving new grocery-focused alliances to improve the role digital data play in marketing and sales, including by Albertsonâs (involving Google (link is external)) (link is external) and Hy-Vee (link is external) (also with Google). Albertsonâs (link is external) (which includes the Safeway, Vons and Jewel-Osco divisions) deal with Google is designed to include âshoppable digital maps to make it easier for consumers to find and purchase products online; AI-powered conversation commerceâ technologies for shopping, and âpredictive grocery list buildingâŚ.â Similarly, Hy-Veeâs work with the Google Cloud will help enable âpredictive (link is external) shopping carts,â among other services. (Hy-Vee is also one of the supermarket chains participating in the USDAâs online SNAP (link is external) pilot project, raising questions regarding how its alliance with Google will impact the privacy and well-being of people enrolled in SNAP).All the data that is flowing into these companies, how it is being analyzed, its use by advertisers and product sponsors, and how it impacts the products we see and purchase, should all be subject to scrutiny from consumer protection and privacy regulators.A good example is Instacart. Its Instacart (link is external) Advertising service allows brands to pay to become âfeatured productsâ and more (link is external). Featured Product ads are a form of paid search advertising. As Instacart tells its clients, if a consumer is searching (link is external)for âchocolate ice creamâ or just âice cream,â and you have bought such ads, âyour product can appear as one of the first products in the search result.â And even after âconsumers place an order, weâll make some suggestions for last-minute additions to the order that the consumer might be interested in. Among these suggestions, the system can include Featured Product ads.âBut itâs all the data and connections to their consuming customers that is the real âsecret sauceâ for Instacartâs ad-targeting and influence operations. The company knows whatâs in and out of everyoneâs shopping carts, explaining that âInstacart tracks (link is external) the source or âpath to cartâ for all items purchased through Instacart marketplace, differentiating between three main groupsâitems bought from search results, browsing departments, aisles, and other discovery areas of Instacart, or from a list of previous purchases, which we call âbuy it again.ââ As it explains, the âInstacart Ads solution (link is external)â offers âa full suite of advertising products that animate the entire customer journeyâfrom search through purchase.â These include opportunities for marketers to become part of âthe âbuy it againâ lists where consumers are shown a list of products that they have bought on previous orders. These can act as reminders of meals or recipes theyâve made before and items they tend to stock up on. Our brand partners can leverage Instacart Ads products to appear on âbuy it againâ lists so they stay top of mind with their customers and aid in retaining valuable customers.âThe companyâs advertising blog discusses its use of what is increasingly the most valuable information a company can haveâknown as âfirst-partyâ data, where (allegedly) a consumer has given their consent to have all their information used. Instacart explains (link is external) this data âencompasses intent and purchase signals⌠from users signed up to an online grocery app,â and that it can be leveraged by its brand and advertising clients. The online ordering company explains that its ârich and diverse data sourcesâ include âaccess to millions of orders over time from over 600 retail partners, across 45,000 stores, involving millions of householdsâŚ. [A] tremendously valuable data setâŚthis data is updated every nightâŚ.â Instacart analyzes this trove of data, including point-of-sale, transaction log and out-of-stock information, to help it zero in on a key goalâto enable its advertisers to better understand and take advantage of what it terms âbasket affinities.â In a webinar, Instacart defined (link is external) that concept:Basket affinities helps Instacart, and its brand partners, to create consumer âtypesâ, discover product interactions, understand mission-dominant baskets, and identify trigger products â ultimately building a picture of how brands are bought online that we then share with our partners to build a better plan to acquire and retain valuable consumers. The term âbasket affinityâ covers examining the one-to-one, group-to-group, or many-to-many relationships between products, as well as identifying consumer shopping missions and consumer profiles. [We note that Instacart says it âaggregates and anonymizesâ this information. However, given its ability to target individuals, we will rely on regulators to determine how well such personal information is actually handled].Instacart also touts its ability to track the actual impact of advertising on its site, noting that it is a âclosed loopâ service âwhere ads are served to consumers in the same âspaceâ any resulting sales occur.â In a blog post (link is external) on how it empowers its advertiser partners, the company notes that Our advertising products provide options that can put their products in front of consumers on every âdiscovery surfaceâ on the platform to catch their eye when they are in this mode. Plus, our data shows that the majority of add to carts from these discovery surfaces are the first time the consumer has added that item to their cart â meaning itâs a great place for brands to acquire new customers.As with other major data (link is external)-driven digital marketers, Instacart has many grocery tech and ecommerce specialist partners, who provide brands and advertisers with a myriad of ways to promote, sell and otherwise âoptimizeâ their products on its platform (such as Perpetua, (link is external) Tinuiti, (link is external) Skai (link is external) and Commerce IQ, (link is external) to only name several).The dramatic and recent growth of whatâs called grocery tech is shaping the way consumers buy products and what prices they may pay. With companies such as Amazon, (link is external) Kroger, (link is external) Walmart, (link is external) Albertsonâs (link is external) and Instacart now in essence Big Data-driven digital advertising companies, the public is being subjected to various practices that warrant regulatory scrutiny, oversight and public policy. We call on the Federal Trade Commission and state regulators to act. Among the key questions are how, if at all, are racial, ethnic and income data being used to target a consumer; are health data, including the buying of drugs and over-the-counter medications, being leveraged; and what measurement and performance information is being made available to partners and advertisers? We donât want to have to âdropâ our privacy and autonomy when we shop in the 21st Century.