Difference between revisions of "Advertising ethics online"

Revision as of 21:55, 9 April 2019

Ethics of online advertisements are the issues and problems that have arisen with the increase of advertisements online. With the rise in digital media and interactive advertising in the 21st century, marketers are now constantly confronted with the ethics of online advertisements. This new ability to advertise online has led to unforeseen changes in human vulnerability when interacting with advertisements. Consumers are presented with advertisements in many more ways than they used to be, leaving older generations unprepared to recognize and react to advertising through new media. More specifically, younger generations are now in an unprecedented role as they consume content from a young age.

Technological development and advertising

Technological developments of the last decade have enabled large corporations to access increasingly private information from consumers such as location, search history, and more. All of this information can then be interpreted and used to tailor advertisements to people on an individual basis. This has risen many concerns regarding user privacy, data protection, reach, and corporate transparency in advertising.

Underage vulnerability to advertising

JUUL E-Cig's Controversial Marketing Campaign that Led to FDA Crackdown in Fall 2018

Targeting children with lucrative advertisements is one of the greatest concerns. The problems centrally lie in children’s inability to “critically evaluate” advertisements and thus identify their “persuasive intent.”^[1] A study conducted by the World Advertising Research Center found that implicit persuasion, such as the use of celebrities or subliminal messages and associations, play a strong role in persuading children with advertisements. Furthermore, cognitive psychology research has concluded that it is not until at least after adolescence, and often “not until early adulthood” that the brain’s prefrontal regions, which control the response to subliminal stimuli, are fully developed and able to recognize and resist subliminal stimuli.^[2] Therefore, these children are not able to process the information that they are being given, which could be seen as a form of brainwashing.

A study conducted by the Federal Trade Commission in 1997 found that 86 percent of the sites listed on a popular children’s website directory collected “personally identifiable information” from children. ^[3]. In response to constantly rising concerns regarding children’s engagements with advertising, the FTC instituted the Children’s Online Privacy Protection Act (COPPA) in 2000. COPPA requires online advertisers to gain parental consent when advertising to anyone under the age of thirteen. However, targeting children in advertising is still largely unregulated as “only twenty-three percent of ad sites that collect personal information of children under thirteen comply with COPPA.”^[4][5]

Targeted advertisements

Over the last decade, advancements in technology have led to a now prominent practice in targeted advertising. Targeted advertising is advertising carried out to specific demographics based on classifications of age, gender, location, purchase, and search history among many others. More personal classifications have generated cause for concern. If privacy is “freedom from informational interference or intrusion, achieved thanks to a restriction on facts about her that are unknown or unknowable,”^[6] then online data collection for commercial purposes violates users' privacy. There is little to no information friction present that prevents targeted advertisements from getting information about people and their preferences. These targeted advertisements shed light on the lack of privacy in online interactions and address the larger issue of whether or not having tailored advertising and information is really in the best interest of the consumer.

Targeted advertisements are of large concern to the general population, and compounded with the concern of pre-adulthood vulnerability they are even more distressing when presented to younger consumers. A study conducted by Masaryk University surveyed 14-to-16-year-olds’ perceived privacy control and the effects of targeted advertisements. This study found that while “privacy control salience” enabled more probable recognition of targeted advertisements by subjects, the subjects were more likely to be persuaded by the targeted advertisements.^[7]

An example of targeted ads on Amazon.com

An increasingly common solution proposed to the privacy concerns of targeted advertising is full transparent compensation for personal information. One proposal published in the Computer Networks journal proposes utilizing ad brokers who offer monetary compensation for personal information from consumers piece by piece and are paid for their services by advertisers. ^[8] Such an exchange fulfills the Nash Equilibrium game theory, in which all players receive the best outcome, and has already come to life via data-payment cafes.^[9]

Transparency

Issues such as underage vulnerability and privacy invasion via targeted advertisements have led to increased attention regarding corporate transparency in online advertising. Researchers at Columbia Business School have found in a study that 80% of the participants are willing to share their shopping and browsing data for the customized ads experiences, but 86% of the participants want to have more control of their data by having the option of opting out.^[10] Similar to the fact that customers have the right to give or refuse data collection before companies start collecting user data, companies have the responsibility to inform customers and let them to choose if they agree to the advertisement tracking methods used by the companies before presenting customized ads.

The key problem of making advertising is that there has yet to be any significant legislation or action taken to correct the corporate transparency concern in either practice. In 2011, the American Advertising Federation’s Institute for Advertising Ethics published an outline of Principles and Practices for Advertising Ethics in order to set a baseline on moral objectives in advertising. The central theme lay in transparency, particularly establishing consumer relationships “in a fair, honest, and forthright manner.”^[11] Guidelines like such, however, have no means of enforcement and are interpreted in the industry as ‘suggestions’ as opposed to requirements. Most companies will create and stand by their own privacy and ethical policies, but recent events have led to public scrutiny of such policies.

Examples of Poor Online Advertisements

Recentently it seems like we have seen a lot of online advertisements that are unethical. Some example range from clothing brands to alcohol brands, but mostly noticeable we have seen commercial that cross the boundary. Arguably the most prevalent was the Kendall Jenner Pepsi ad. In the ad Kendall Jenner ended a politically charged rally by winning over a police officer with a can of pepsi. People become outraged at the idea that a soda could solve social justice issues and the add was quickly pulled. The ethical issues here were very easy to spot, however for other issues the can be more difficult.

Ethical Issues

Unauthorized Purchases

The ease with which young children can now engage with advertisements on computers, tablets, and smartphones has given light to a new dilemma surrounding payment authorization. The inability to critically evaluate advertisements is leading kids to make purchases online and in apps through their parents' bank accounts that parents have not approved of.

In January of 2014, Apple Inc. agreed to a settlement with the Federal Trade Commission that required Apple to pay back a reported $32.5 million dollars in app store and in-app purchases to parents whose children made purchases without the parents' consent.^[12] The settlement also required that Apple instill further security measures for in-app purchases, including getting explicit parental consent for any purchase in order to ensure informed consent before charging customers.

While enforcement of the Federal Trade Commission's ruling led Apple Inc. to take measures such as fingerprint identification and password requirement for all billing purposes, the issue of unauthorized purchases still looms large. The Federal Trade Commission mandated that Apple establish these changes by March 31, 2014, but a notorious since-deleted twitter rant by rap artist Kanye West made it clear that in-app purchases were still a problem.^[13]</blockquote>

Unwanted Exposure

Generating user-targeted advertisements carries the risk of the person behind the screen not being the intended user, leading to serious privacy concerns. Many sites track user activity by IP address, meaning having multiple people on a single device can cause overlap in who receives targeted ads. Additionally, the tech industry's trend towards an oligopoly has caused similar problems. A user who asks something of their Google Home, for example, will have such information then associated with their Google account which can lead to targeted ads on any device upon which their Google account is signed in. Likewise, Facebook's purchase of Instagram has given them reach over two of the four most popular social media platforms in the world, and information from either account can cross over. This poses the threat of misfiring when directing targeted ads, which can have extensive consequences.

The most notorious such case occurred in 2011 when a family became aware of their teen daughter's pregnancy due to a Target mail coupon catalog full of baby items. As detailed in a Forbes report on the incident, target collects their own purchase history information and combines it with demographic information they buy from 3rd parties to create profiles to target each customer."^[14] Such an incident illustrates the breach of privacy and unwanted exposure that is risked when companies use targeted advertisements.

How much information is on file?

When users sign up for sites or browse them, they usually (whether inherently or explicitly) agree to the terms of usage of the sites. However, the vast majority of users don't read Terms and Conditions and thus aren't typically aware of what kind of information they are surrendering to corporations. This often leads to public outrage when certain aspects of a privacy or usage agreement leads to corporate practice that users may not like. That was the case in 2015 when Snapchat updated their terms of service, essentially giving themselves "the rights to reproduce, modify and republish your photos and save those photos to Snapchat’s servers."^[15] This was a giant leap in size compared to how much data users were forfeiting to the company before, and since most users agreed to the terms without reading them it led to widespread outrage and extensive privacy concerns.

The problem has grown to be much larger now, as more recent events have users questioning how broad a scope the terms can cover. Tech giants such as Facebook and Google are pushing the boundaries of what is normalized in user data collection, and even then they have generated controversy by collecting data without consent.

Facebook’s Cambridge Analytica data leak and Google Plus’ API bug are two of the larger scandals that have brought such concerns to the forefront of the legislative agenda. The former breach allowed Cambridge Analytica to access private user data that was used for political persuasion using methods similar to those used in targeted advertising. ^[16]. The latter sprung from a bug in an API update that left private user data exposed to those who might use the API and led to the shutdown of Google+’s commercial platform. ^[17]

While not all the collected information may be used for advertising purposes, it has been used for much more extreme practices (as was the case in the Cambridge Analytica scandal) and there's no telling which seemingly obscure data can be utilized to target consumers.

References

1. ↑ Nairn, Agnes, and Cordelia Fine. "Who’s messing with my mind? The implications of dual-process models for the ethics of advertising to children." International Journal of Advertising 27.3 (2008): 447-470.
2. ↑ Casey, B.J., Getz, S. & Galvan, A. (2008) The adolescent brain. Developmental Review, 28(1), pp. 62–77.
3. ↑ Jill Austin, M., and Mary Lynn Reed. "Targeting children online: Internet advertising ethics issues." Journal of consumer marketing 16.6 (1999): 590-602.
4. ↑ Carpenter, Keelan. "Ethical Issues of Online Advertising and Privacy." (2013).
5. ↑ Cai, X., and Zhao, X. "Online Advertising on Popular Children’s Websites: Structural Features and Privacy Issues" Computers in Human Behavior. Elsevier. (2013).
6. ↑ Floridi, Luciano. The 4th Revolution: How the Infosphere Is Reshaping Human Reality. Oxford University Press, 2016
7. ↑ Zarouali, Brahim, et al. "“Everything under control?”: Privacy control salience influences both critical processing and perceived persuasiveness of targeted advertising among adolescents." Cyberpsychology: Journal of Psychosocial Research on Cyberspace 12.1 (2018).
8. ↑ Wang, Wei, et al. "A privacy-aware framework for targeted advertising." Computer Networks 79 (2015): 17-29.
9. ↑ Schaffel, Chaiel. "No Cash Needed At This Cafe. Students Pay The Tab With Their Personal Data." National Public Radio. 29 September 2018.
10. ↑ Nichols, Timothy. “It's Time To Increase Transparency In Online Advertising.” Forbes, Forbes Magazine, 11 July 2018, www.forbes.com/sites/forbesagencycouncil/2018/07/11/its-time-to-increase-transparency-in-online-advertising/#5b920b6d4dca.
11. ↑ Wallace, Snyder S. "Principles and Practices for Advertising Ethics." American Advertising Federation. (2011).
12. ↑ "Apple Inc. Will Provide Full Consumer Refunds of At Least $32.5 Million to Settle FTC Complaint It Charged for Kids’ In-App Purchases Without Parental Consen."Federal Trade Commission. https://www.ftc.gov/news-events/press-releases/2014/01/apple-inc-will-provide-full-consumer-refunds-least-325-million
13. ↑ D'Orazio, Dante. "Kanye West is fed up with in-app purchases." The Verge. 10 Oct 2015. https://www.theverge.com/2015/10/10/9493905/kanye-west-is-fed-up-about-in-app-purchases
14. ↑ Hill, Kashmir. "How Target Figured Out A Teen Girl Was Pregnant Before Her Father Did." Forbes. 16 Feb 2012.https://www.forbes.com/sites/kashmirhill/2012/02/16/how-target-figured-out-a-teen-girl-was-pregnant-before-her-father-did/#1912848b6668
15. ↑ French, Sally. "Snapchat’s new ‘scary’ privacy policy has left users outraged." Marketwatch. 2 Nov 2015. https://www.marketwatch.com/story/snapchats-new-scary-privacy-policy-has-left-users-outraged-2015-10-29
16. ↑ Wikipedia contributors. "Facebook–Cambridge Analytica data scandal." Wikipedia, The Free Encyclopedia. Wikipedia, The Free Encyclopedia, 21 Feb. 2019. Web. 15 Mar. 2019.
17. ↑ Wikipedia contributors. "Google+." Wikipedia, The Free Encyclopedia. Wikipedia, The Free Encyclopedia, 13 Mar. 2019. Web. 15 Mar. 2019.