big data and online behavioral advertising do we need an ethical analysis
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Vrije Universiteit Amsterdam (VU)
Msc. Marketing
Marketing strategy
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New telecommunicaton technologies big data and online behavioural
advertsing: do we need an ethical analssist
Nill et al
Online Behavioural Advertsing (OBA): a technique that enables advertsers to develop a behavioural
profile of consumers based on consumers online behaviour for marketng-related purposes.
These individualized consumer data allow advertsers to deliver individually relevant messages, which
potentally increase the efectveness of advertsements and in turn advertsing revenues.
New media’s growing importance in advertsing
The significant growth of online advertsing refects the shif in how consumers are using media. The
new media allow companies to connect with customers through an engaging interacton.
With a growing number of internet companies relying on advertsing as a revenue source to monetze
their content or services competton in the online advertsing market has been increasing. Because
of this changing compettve landscape, online marketers are looking for ways to make
advertsements more efectve. OBA, the targetng of customers based on their online actvites, is a
very promising way to increase the efectveness of advertsements and in turn advertsing revenues.
Online Behavioural Advertsing
The collected data include visited websites and webpages or viewed individual items, search terms
used and what goods or services they purchased. OBA helps marketers make their ads more relevant
and interestng to consumers. This in turn increases the efciency of the advertsement. If consumers
are interested in the advertsing they receive, they are more likely to be responsive.
Advantages of OBA for online marketers:
More efcient advertsements7
Improved market segmentaton7
Beter analysis of risks and fraud7
Beter ability to adapt ofers to meet demand.
Advantages of OBA for customers:
Enhance customers experience when surfing on the Web7
More relevant services and informaton and result in cheaper services, content and
applicatons (revenue from OBA allows publishers to keep the content free of charge).
A risk for customers is their privacy since a lot of consumer data is collected and analysed (the use of
cookies). Another privacy issue is about the involvement of Internet Service Providers (ISPs). Internet
providers have access to a lot of personal data of consumers such as real names and physical
locaton.
The current state of the law and public polics
The federal Trade Commission (FTC) explores the legal and policy parameters of what it refers to as
“understanding the online market and the privacy issues it raises for consumers”. They monitor that
companies take good care of the privacy of customers.
Whs be ethicalt
In a free market system, the responsibility of marketers is to conduct business in the pursuit of
economic interests only. This line of thinking rests on two assumptons:
Obey the law: by heeding those laws, marketers would act sufciently ethical7
Economic self- interest: forces of the market (Smith) will ensure ethics in the market place7
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