Advertising Law Blog

As we previously reported the FTC has placed pressure on behavioral marketers to self-regulate or face regulation. Under this threat, a broad coalition of advertising associations moved forward on establishing an easily identifiable icon and plain language in a disclosure statement that will be linked to the icon. The coalition includes the American Association of Advertising Agencies, the Association of National Advertisers, the Direct Marketing Association, and the Interactive Advertising Bureau.

This cross-industry self-regulatory task force represents the first time that representatives of the entire advertising ecosystem have come together to develop Principles for the use and collection of data.

When consumers click on the icon, they will be sent to a page explaining how the advertiser uses their web surfing history and demographic profile to send them certain ads. Though not legally bound to display the icon, the advertising coalition predicts most companies belonging to one of their organizations will do so.

The Principles are designed to address consumer concerns about the use of personal information and interest based advertising while preserving the innovative and robust advertising that supports the vast array of free online content and the ability to deliver relevant advertising to consumers. This self-regulatory program consists of the following seven Principles.

• The Education Principle calls for organizations to participate in efforts to educate individuals and businesses about online behavioral advertising. To this end, the digital media industry intends, in a major campaign that is expected to exceed 500 million online advertising impressions, to educate consumers about online behavioral advertising, the benefits of these practices and the means to exercise choice, over the next 18 months.
• The Transparency Principle calls for clearer and easily accessible disclosures to consumers about data collection and use practices associated with online behavioral advertising. It will result in new, enhanced notice on the page where data is collected through links embedded in or around advertisements, or on the Web page itself.
• The Consumer Control Principle provides consumers with an expanded ability to choose whether data is collected and used for online behavioral advertising purposes. This choice will be available through a link from the notice provided on the Web page where data is collected. The Consumer Control Principle requires "service providers", a term that includes Internet access service providers and providers of desktop applications software such as Web browser "tool bars" to obtain the consent of users before engaging in online behavioral advertising, and take steps to de-identify the data used for such purposes.
• The Data Security Principle calls for organizations to provide reasonable security for, and limited retention of data, collected and used for online behavioral advertising purposes.
• The Material Changes Principle calls on organizations to obtain consent for any material change to their online behavioral advertising data collection and use policies and practices to data collected prior to such change.
• The Sensitive Data Principle recognizes that data collected from children and used for online behavioral advertising merits heightened protection, and requires parental consent for behavioral advertising to consumers known to be under 13 on child-directed Web sites. This Principle also provides heightened protections to certain health and financial data when attributable to a specific individual.
• The Accountability Principle calls for development of programs to further advance these Principles, including programs to monitor and report instances of uncorrected non-compliance with these Principles to appropriate government agencies.

The complete report can be found here.

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