Privacy & Personalization

March 17, 2008

Digital Marketing ChannelAdvisor By ChannelAdvisor

I, {State Your Name}

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In the classic 1970s movie “Animal House”, the inept pledges of Delta House couldn’t manage to follow directions. When asked to repeat the house pledge, the repeated it exactly as it was told to them. “I, state your name, do hereby pledge allegiance to the frat.” In today’s world, personalization in online advertising is becoming more and more possible and sophisticated to the point of creating legitimate privacy concerns as well as opportunities for advertisers. Recently, the NY Times asked the big search providers if they could or would insert the user’s name in paid search ads. Generally, they answered that it might be possible, but they are not (currently) interested in doing it. And it would only apply to users who are already logged in or cookied so that the site recognizes you. Microsoft could do it in such a way such that there was no actual personal data stored, but the user’s perception might be of a loss of privacy.

Now this raises a host of privacy issues. How would users react if they saw ads that said, “Jason! Buy Widgets Now.” or “Fred, We Have the Biggest Selection of Foobars.” It sounds kind of creepy. Users should rightly be concerned if this data were made available to advertisers. And the extent to which the search providers are gathering this data on each person and building a profile of his or her habits and interests is concerning as well.

But privacy issues aside, would it actually convert better for retailers? It’s impossible to know for sure without getting to test it, but in paid search advertising, the more relevant the ad, the more likely it is to get clicks, and to convert. There needs to be a call to action. It also needs to attract the user’s eye, and I imagine that seeing your name in the ad would be very likely to attract attention.

The search providers would have to make a feature like this available to everyone or no one. There might be a benefit for all if it pulls some clicks away from the natural search results to the paid ads, so a feature like this could increase clicks for all advertisers and increase the search providers revenue. At that point, it becomes like steroids in sports. If personalizing the ad by including the user’s name improves click through, then all advertisers will quickly adopt it. If everyone else is doing it, then you have to do it too, just to be competitive. Everyone is now using 5-10 characters of their precious ad text for the user’s name.

In the end, it would be worth it to advertisers if it improves the user experience. By improving the user experience, advertisers can count on more relevant ads and better conversion. “With liberty and fraternity for all. Amen.”

written by Jason James — jason.james at channeladvisor.com