Cracker of an Issue

Untangling the Web of Online Advertising and Privacy

Friday, August 26, 2005

Walk the talk to save your Cookies

Dave Morgan of Tacoda, the behavioral targeting company, believes that the ‘cookie mess’ can be fixed by Publishers, because they are the ones with regular, recurring, and direct relationships with consumers and are the "gatekeepers" that advertisers and their agencies pay to contact and engage those consumers. He does have a valid point about how Publishers and not companies that provide online advertising technology and services are in a much better position to drive consumer education efforts regarding cookies. However, by putting the onus on Publishers, it does not mean that companies like Tacoda have no role to play in fixing the cookie problem. After all, Tacoda works with Advertisers and Publishers so aren’t they in a great position to convince their clients about the importance of clear and prominent disclosures regarding the use of cookies?

Lets take a website like Boston.com (A Publisher client that uses Tacoda's Audience Management Service). Their privacy policy contains the following disclosure regarding Tacoda:

Our websites are currently contracted with Tacoda Systems, a third party, to track and analyze anonymous usage and browsing patterns from our visitors and customers. All data collected by Tacoda on behalf of our websites is owned and used by the New England Media Group alone. We use this information to help provide our advertisers with more targeted advertising opportunities, which means that users see advertising that is most likely to interest them, and advertisers send their messages to people who are most likely to be receptive, improving both the viewer's experience and the effectiveness of the ads. For more information about Tacoda’s privacy policy, including how to opt out, go to www.tacoda.com/privacy_policy.htm

Lo and behold, the above disclosure does not even mention that Tacoda uses cookies! An online user would have to read Tacoda’s privacy policy to realize that Tacoda uses a feature of their browser to set a "cookie" on their computer. Further, Tacoda’s privacy policy contains an opt-out link, which then redirects the user to an NAI opt out page! How many pages is a consumer supposed to navigate through and how many privacy policies is a consumer supposed to read before they can understand what Tacoda does and the choices they have regarding Tacoda’s cookie? If Dave Morgan believes that Publishers must develop a policy to provide clear and transparent information about how they use cookies or similar technologies, why not contractually obligate Tacoda’s clients to prominently disclose that Tacoda uses cookies and why not include a direct opt-out link in the disclosure on the Publisher’s site itself? Maybe these minor changes will not solve the cookie deletion problem, but isn’t it more transparent and consumer-friendly than what is currently being disclosed on a prominent site like Boston.com? Further, as part of its deal with the New York Times Company, Tacoda reportedly also provides behavioral targeting services to NYTimes.com and NYTimes.com’s Privacy Policy does not even mention Tacoda!

Maybe disclosures in Privacy Policies are not the best way to improve consumer understanding of cookies and why they should not be equated with spyware, but, as of now, they are the only place where consumers can learn more about the use of cookies on websites. I strongly support Dave Morgan’s push for transparency, but I do hope he takes his own advice that “Consumers will only be happy and well served if every company that tracks and uses consumer information is fully transparent about what data is being tracked, how it is being used, and if consumers are given the opportunity to consent to participate in the process....Putting this information in their privacy policies is only the first step, not the last.”

I couldn't have said it better myself.

UPDATE (August 29, 2005): I contacted Dave Morgan of Tacoda after posting this, and here's his response.

"no TACODA cookies are set on Boston.com or NYTimes.com … while they use TACODA’s technology to target their ads, they do not set any TACODA cookies. All of the cookies they use for targeting are set in their own domains, and can not be read or used by third parties. TACODA cookies are only set by sites that participate in our advertising network."

Thanks Dave, this is great, but don't blame consumers for being a little confused about all this. I pretend to understand how online advertising works and I was! (after reading Boston.com's and Tacoda's privacy policies). I agree with your views that it's all about respecting consumers in the end, and that's why we need better disclosures!