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Canadian privacy watchdog unveils new online advertising guidelines

Privacy commissioner Jennifer Stoddart aims to make targeted ads more transparent.

Jennifer Stoddart, Canada’s privacy commissioner (Photo: Adrian Wyld/CP)

You’re being followed right now. Forget scanning for a pair of eyes leering over the cubicle wall, this type of tracking is online. Where you go, what you look at, search, buy or browse, can all be collected and used to better target you for advertising. This of course is a double-edged sword. You don’t have any kids, why should you ever see a diaper ad? Your Facebook status mentioned an upcoming ski trip, why not find out about a hotel or flight discount? On the other hand, should a corporation know that much about your life?

On Tuesday, the Privacy Commissioner of Canada, Jennifer Stoddart, unveiled a set of new guidelines for online behavioural advertising that focused primarily on the tracking of children and technology that doesn’t allow users to opt out.

Speaking at the Marketing and the Law conference in Toronto, Stoddart said the new guidelines are a reasonable approach that allows advertisers to be innovative while ensuring Canadian’s privacy rights are protected. To illustrate her office’s concerns, she cited a recent study by Worcester Polytechnic Institute and AT&T that found some popular websites automatically forward personal information to data tracking aggregators, apparently without meaningful user consent.

“We understand the importance of the digital economy and that’s particularly vital in these challenging economic times,” said Stoddart, who has famously faced down Facebook, Google and others on online privacy. “But growth requires consumer trust, that people trust you. That’s where privacy comes in. From its inception, the goal of PIPEDA (Personal Information Protection and Electronic Documents Act) has always been to balance individuals’ right to privacy with business needs. With all this in mind, it’s our position that using behavioural advertising may be reasonable but there are some ‘buts.'”

Under the new guidelines, individuals should be obviously aware if their information is being collected, not just in illegible tiny type legalese. There should also be an easy opt-out option that takes effect immediately, and any information collected and used is destroyed as soon as possible or effectively made anonymous. Opting out of tracking should also not make a service or site unusable or opting in be made a requirement for use. When it comes to advertising aimed at children, because it is so difficult to ensure meaningful consent, the guidelines recommend “organizations should avoid tracking children and tracking on websites aimed at children.”

Marketers love targeted advertising for a slew of reasons, chief among them that it serves up products and brands a user might actually use and respond to, making it money better spent. Credit card companies are working to use your purchases to better target you with online ads, while even print magazines are getting in on the targeting act.

“We do know that this kind of advertising is more effective than scattershot, so we want to preserve it because it works really well,” said Bob Reaume, vice-president of the Association of Canadian Advertisers, after Stoddart’s announcement. “We don’t want to creep consumers out but we think it’s a very good tool. I was pleased to hear the privacy commissioner say she understands how important this is for business, so I think there has been a real meeting of minds here.”

Reaume said there weren’t any surprises in the new guidelines and that the ACA will unveil a marketing campaign aimed to educate consumers about online behavioural advertising in early 2012. Stoddart praised both the ACA and the Canadian Marketing Association for their co-operation and leading self-regulation when it comes to targeted online ads. That said, she acknowledged that conversations between the advertisers who want to utilize cutting edge technology and her office do get intense.

“If a sector or organization says, ‘But we can’t do this!’ We’ll push them and see if it means they will pull the plug on their business or if there are other more privacy protective approaches, and usually there are,” said Stoddart, who has bulked her office up over the past few years with technologists, economists and other experts to help interpret the wide world to which PIPEDA applies.

During her presentation, Stoddart also said her office is in the final stages of an investigation of “a social networking site targeted at youth” and the findings, to be released in the next few weeks, will specifically address online behavioural advertising, including third-party tracking cookies.