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DAA to Begin Enforcement this Fall

Beginning this September, the advertising industry will have to allow customers to opt out of receiving ads targeted based on data collected across mobile apps. This was a recent announcement made by the Digital Advertising Alliance (DAA) on Thursday, May 7.

According to the DAA’s mobile privacy code, initially presented in 2013, ad networks and other companies are required to notify customers about cross-app advertising and allow them to opt-out, through an app.

AppChoices

Earlier this year, the DAA released a mobile opt-out app entitled AppChoices, which is available for free from Google Play, the Apple App Store and the Amazon Store. The ad industry’s rules also require companies that collect data across the mobile websites to allow consumers to opt out of receiving targeted ads on their mobile devices.

AppChoices aims to give companies a standardized way of providing consumers enhanced transparency and control over cross-app data. According to DAA executive director Lou Mastria:

“Americans want transparency and choice that is available to them whenever and however they use the Internet, including the mobile environment. DAA provides a platform for companies to provide these privacy features in an enforceable manner which builds trust in this emerging ecosystem.”

Although the self-regulatory group announced the mobile privacy rules almost two years earlier, the industry has not previously set a compliance deadline. According to Mastria, “We give companies a reasonable amount of time to make sure that everything’s in order.”

Participation Incentives

This may seem puzzling, as ad companies’ business models involve targeting consumers by location. What would be their incentive for participating in such a program?

Monica Ho is SVP of marketing at xAd, of of 18 ad tech companies participating in the DAA program. She comments:

“We’re very supportive of it because anything that the industry is doing to educate consumers that they really do have control and transparency to know who can and cannot use their data is a good thing. As they’re deciding when they do and don’t want ads, we want them to know there are multiple tools at their disposal for that.”

xAd offers ad agencies, direct marketers and programmatic ad buyers the opportunity to leverage location data in their advertising and marketing. They constantly toe the “creepy line.” According to Ho:

“When people start opting out of ads, it’s because something went wrong. It’s because either the ads were annoying or it was done in a way where there was no value exchanged with the consumer… If the ads themselves are helpful and they’re not creeping you out and you’re getting an offer you can leverage, or a sale you can take advantage of, then you’re not going to opt out.”

Obtaining Consent

The mobile advertising code mirrors the industry’s longstanding privacy rules for behavioral targeting on desktops and laptops, but includes some requirements geared for smartphones and tablets. Among other requirements, the DAA requires ad networks, app developers and other players in the mobile ecosystem to obtain consumers’ opt-in consent before collecting geolocation information and address book data.

Mastria commented that the Better Business Bureau’s online accountability program will monitor cross-app advertising proactively and also respond to complaints. His organization has been enforcing desktop privacy rules, which apply to data collected from consumers’ desktop and laptop browsers, for the past four years. Since then, the DAA has named over a dozen companies – including BuzzFeed, Yelp, Turn, Blue Cava, Volkswagen and Scottrade – which have revised their practices or privacy policies after receiving inquiries.

Not alone

However, the DAA isn’t the only organization to release an app enabling people to opt out of mobile behavioral advertising. Privacy compliance companies including TRUSTe and Ghostery also offer very similar apps. Additionally, the largest mobile operating systems now come with built-in controls that enable people to control cross-app targeting.

For example, Apple offers a “limit ad tracking” setting, which conveys to ad networks that users don’t want to be tracked. Google also offers a comparable feature for Android devices.

Summary

The Digital Advertising Alliance is poised to enforce their mobile privacy rules beginning this September. The Code was released in 2013 and requires ad networks and other companies to notify consumers about cross-app advertising and allow them to opt out, through an app known as AppChoices.

CIPP Exam Preparation                                      

In preparation for the Certification Information Privacy Professional/Information Technology (CIPP/IT) exam, a privacy professional should be comfortable with topics related to this post, including:

  • E-commerce personalization – end user privacy concerns (II.C.b.)
  • E-commerce personalization – unsolicited marketing (II.C.b.i.)
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