Privacy May Dog Online Advertising

A Texas woman is suing Blockbuster for sharing details of her movie rental and purchase activities with Facebook through the Beacon program, according to the Associated Press. An Advertising Age article I recently wrote looks at the privacy issues that are likely to face those marketing online, and this is a great example. It's not that "real world" marketing is any better. In fact, much of it is worse in terms of the information it collects, coordinates, and uses, but because of the time spans between collection and use, and the lack of apparent connection, this has been largely invisible. However, the digital world is making this more obvious, rubbing the results in the faces of people. Those in marketing had best pay attention, because these are issues that can too easily bite when you least expect them.

Facebook Re-learns Basic Customer Lesson

I'd ask when will companies learn, but the answer is usually never. Facebook decided, again, to try and "monetize its assets" - that is, the users. It wanted to track what people did and exploit what it learned for its own ends. And, as newspapers like the Washington Post are reporting, those customers have forced the company to back down. Read the article to see how a man's surprise Christmas present for his wife (at least, I hope it was for his wife, and if it wasn't, it is now) became known to her and many others, as Facebook broadcast his purchase. Here's a quote, in the story, from a MoveOn.org rep:

"Sites like Facebook are revolutionizing how we communicate with each other and organize around issues together in a 21st century democracy," said Adam Green, a spokesman for MoveOn.org, a liberal activist group that has launched the petition drive to pressure Facebook to stop broadcasting members' purchases and using their names as endorsements without explicit permission. "The question is: Will corporate advertisers get to write the rules of the Internet or will these new social networks protect our basic rights, like privacy?"

It's not just about privacy, though. When you start dealing with customers, you are entering a contract. It's not written, but it's stronger than any piece of paper, because it involves their expectations and demands. Flub enough on your end, and you're ended, because the people who make your business possible will walk away with their money.

Unfortunately, businesspeople who damned well should know better let greed and wishful thinking get ahead of them. That's why there was a dot com blow up, and why the current credit crisis is in full bloom. And unless online companies start getting street smart and people wise, they're going to find that the market and even government step in to put bounds on what they can do. And no one should look to have those forces registered as friends that watch your every move.