The Funnel

Targeted Ads: Convenient or Creepy?

Are your targeted ads freaking out your customers?

Has this happened to you.

You meet an old friend. You go out for drinks. You haven't seen each other for years. There is so much to catch up on.

You go over the formalities: How's the new job? How are the folks? How's the significant other? Your friend asks the same.

A few beers in and things start getting interesting. Newly thought business ideas are swirling, memories of all those drunk college parties come flooding back.

Briefly during the conversation your friend mentions how he's started going to the gym.

You blush.

You haven't exercised in years and you have no plans to start. That beer belly hanging out of your gut isn't going away anytime soon.

But you nod your head anyway and mumble out: "Nice! I've also been thinking of joining a gym."

Just an offhand remark in a two hour conversation. No big deal right. You continue on with the night and eventually go home.

Later that evening you look at your phone, open your Facebook, scroll through your newsfeed and, alas, what do you see?

An ad for a gym membership. 20% off if you sign up today.

Creepy.

How did Facebook know to show you that ad? Were they listening through your phone the whole time while you two were talking?

Well, welcome to targeted marketing in 2019.

The idea that Facebook is eavesdropping on everything we say is not new.

Despite repeated denials from the company, videos like the one below keep popping up and fueling the conspiracy.

It's of course highly unlikely that Facebook is actually listening to our conversations. In addition to it being illegal, it would require storing enormous amounts of data, most of which is useless.

But as it turns out, Facebook doesn't actually need to be using a microphone to figure out what ads to serve to you. The company gathers enough data about you and your friends for that.

There is Facebook Pixel, a piece of code that can be included on any website allowing Facebook to collect information about what you do on the website, what links you click on, what articles you read or what items you buy.

There is also offline data about you Facebook can collect, such as where you live, how much you earn, or how many credit cards you own.

Add in things like location tracking and it becomes pretty easy to explain the scenario at the bar with your friend.

One possibility: Your friend was actively Googling gyms a few hours before meeting up with you. Facebook saw you two were friends and that you were both at the same bar.

They reasoned that most likely your friend would mention gyms during your conversation. So they then served you an ad about joining a gym as well, assuming you might be interested.

So okay, Facebook isn't listening. But is this kind of targeted marketing going too far?

Recent surveys suggests it could be, and that users are starting to push back against targeted ads.

The case in favor of targeted ads

A recent eMarketer article looked at several surveys related to targeted ads and found mixed results when it came to user attitudes toward them.

There is lots of evidence to support personalizing and targeting your ads.

Adlucent found that 7 out of 10 customers yearn for personalized ads.

A survey by Epsilon found that 80% of costumers were more likely to make a purchase when brands offered a more personalized experience.

And a study by Segment concluded that:

"Consumers expect highly personalized shopping experiences from retailers and are willing to spend more money when brands deliver targeted recommendations. Despite those expectations, however, a majority of consumers are disappointed with the ongoing lack of personalization in their shopping experiences. On average 71% express some level of frustration when their experience is impersonal."

In other words, users want to be targeted with relevant ads, just brands aren't doing this the right way.

Tellingly, an Adobe study from earlier in 2018 found that US consumers basically spend the same amount of time sleeping as they do viewing content online.


Image Source: Adobe

In an environment where so much content is being created, a brand's ultimate goal is to stand out. This gets the customer's attention. And to do this effectively, personalizing your brand is paramount.

Adobe backs this up with compelling stats:

  • 67% of respondents said it's important for brands to automatically adjust content based on their current context
  • 42% get annoyed when their content isn't personalized
  • 33% get annoyed when content is poorly designed
  • 29% get annoyed when content isn't optimized for their devices
  • 66% would not make a purchase if they encountered any of the above situations

In addition, Adobe found that 48% of consumers will visit a brand's website to research a product, with 59% of consumers then buying the product online and 49% visiting in store. After buying a product, 51% return to the brand's website for follow-up research.

Targeted ads thrive in such an environment. A user visits your website but doesn't convert. You then remind that user about your brand on social media with a targeted ad. Perhaps they convert next time.

The case against targeted ads

At the same time users are increasingly concerned with the way targeted ads use personal data and handle privacy.

It looks like a year of data privacy scandals at Facebook and other data breaches are finally taking their toll.

Broadly speaking, users have two main problems with targeted ads:

1. Concerns about data collection

A study by the global cybersecurity firm RSA Security found that there was increasing consumer backlash in response to numerous high-profile data breaches in recent years, exposing a hidden risk of digital advertising: loss of costumer trust.

The study surveyed over 6,000 adults in France, Germany, the United Kingdom and the United States and found that across all geographies surveyed, consumers increasingly perceived personalized ads as intrusive and unethical.

The study found that people largely view it as 'unethical' for their data to be used to give them personalized content or ads.

2. Targeted ads aren't actually useful

Privacy issues are one concern for users. The other is that targeted ads aren't actually offering relevant content.

According to the RSA Survey, only 29% of respondents said handing over data resulted in better products or services, down from 31% the previous year.

Moreover, targeted ads are increasingly starting to feel intrusive instead of personalized, which create a negative ad experience and hurt brand reputation.

For example, 85% agreed with the statement that "obnoxious or intrusive ads give me a poor opinion of the websites that allow them."

It's one of the reasons adblockers are on the rise, with an estimated 198 million active users and over 500 million downloads.

The main reasons users cited for using adblockers include:

  • Ads are annoying/intrusive (64%)
  • Ads disrupt what I'm doing (54%)
  • Ads create security concerns (39%)
  • Better page load time/reduced bandwidth use (36%)
  • Offensive/inappropriate ad content (33%)
  • Privacy concerns (32%)
  • Reduced data usage (for mobile plans) (22%)
  • I don't like contributing to a business making money off my browsing (18%)
  • Ideological reasons (8%)

In other words, targeted ads often hinder people's browsing experiences and are disruptive.

When do targeted ads go too far?

Two Brooklyn-based artists created a website called The New Organs which attempts to visualize the increasingly aggressive targeted ads that consumers are faced with.

With over 700 user-generated submissions, the picture the website creates looks like it is straight out of a Black Mirror episode.

Despite the over-the-top whispery voice, the video makes a good point. Targeted ads are beginning to freak people out.

Here is a sample of some stories found on their site:

"At a party, had a good contact with a girl. Nothing happened. We both went our seperate ways. Later, she was the first friend suggestion on Facebook."

"I was talking on the phone about a street where I was supposed to meet some friends. And the first suggestion in Google Maps was this street. I've never been to this street before."

"A friend sent me a photo of his new keyboard he had bought (we had talked about it over voice, no typing) and from then on I would see advertisements for this very specific keyboard!"

"I bought these pineapple shaped earrings in a small cafe in the Queensland countryside. I paid cash. A short time later I googled plastic jewelry on my phone and an image of these exact same rubber earrings appeared in the top of the search."

"Coworker described a gift she got for a friend for Christmas. I responded enthusiastically and said I'd love one. BAM! I shit you not, I had an email from Amazon the next day with an exact link to THAT product. Creeped us both out."

"I have one disgusting ad that has been following me around on my web searches for several years ever since I turned 60. "90 year old woman looks 50!" I've changed my age on Facebook and use adblockers but it still manages to get through sometimes!"

And so on.

How do user feel about these ads? Some general themes include:

  • Feeling like they are being listened to and eavesdropped on.
  • Seeing the same ad follow them on different websites.
  • Being tracked via geo-location
  • People start dating someone new and then start getting ads targeted at their new lover.

And that's just on the user reported feelings. From the advertiser's side several scandals have come out in the public in the last few years.

For instance, in early 2018 Facebook had a lawsuit raised against it for allowing real estate brokers to show ads only to whites, and thus discriminating against Hispanics, African Americans or people with disabilities.

Targeted ads shown on Facebook have also been blamed for making it much easier for scammers to cheat vulnerable groups of people more likely to fall for their sales pitches. Bloomberg covered the topic in a great article and video posted below.

Tips for marketers when using personalized ads

1. If you wouldn't do it in person, don't do it in your ads

As the examples above show, targeted ads can risk alienating potential customers if they are too aggressive.

This is especially true for retargeting.

A good rule of thumb is to think about whether you would act the same way in person with your ads.

If somebody was in your store and they looked at some shoes then put them down to look at another item, would you follow them around asking "are you sure you don't want to buy those shoes?", "why don't you want those sunglasses?", "this is your last chance to buy those sunglasses?"

Probably not, this would just piss the customer off.

But this is what retargeting can feel like to users when they have ads follow them around on the internet everywhere.

2. Don't show your ads so often

In the same vein, don't show your ads too often to your customers.

Think of it like dating. If you come off as pushy, aggressive or desperate you will freak out your potential partner. If you play it cool and be less intrusive, your partner may end up chasing you.

3. Use targeted ads only based on browsing history

People have largely accepted the fact that their browsing history is used to show them ads.

What freaks people out is when people are shown ads for things they never searched for. If people are shown ads for things they took a picture of or for what they just discussed with a friend, your brand is more likely to come off as stalkerish.

4. Honesty is the best policy

It's best to be upfront with what information your website collects. Consumers are becoming more wary of how their data is handled, so informing people about why they should accept cookies on your website will make you transparent in user eyes.

Tips for users to avoid targeted ads

For users, there are several moves you can make if you want to stop seeing targeted ads. These include;

  • Clear your cookies: Whenver you visit a website, a cookie is created that creates a unique ID of you and enables companies to then track you throughout the internet. If you clear your cookies on your web browser, companies will find it harder to track you.
  • Clear your history: Your browsing history is used to create information about you that advertisers then use to target you with ads. You can view this information using Google's My Activity tool and see what information the search giant has gathered of you.
  • Reset your Advertising ID: Android and Apple phones use advertising IDs that help marketers track you. But they can be reset at any time in the settings sections of your phones.
  • Use an Adblocker: Web browsers let you install add-ons that block ads, such as uBlock Origin for browsers and 1Blocker X for iPhones.
  • Use a private browser: Firefox Focus, DuckDuckGo and Opera offer browsers that have built in ad blocking. If you want to search for something without being tracked, these are the web browsers to use. In addition, Google Chrome offers incognito windows you can open to browse the web anonymously.
  • Use a trackblocker: Tracker blockers prevent snoopy code from loading on websites on both desktop and mobile, such as Disconnect.me.
  • Opt out of interest-based advertising: There is a way to opt out of interest-based advertising, so that all those likes you make on social media aren't used to provide you with ads. It's a complicated process with these companies deliberately hiding it so that users don't go through all the effort. But if you disable this advertising, you will not be tracked online.
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