As the search engines continue to work on improving their user experiences but at the same time need to examine to how increase the amount of money advertisers are spending online. To accomplish the switch for traditional offline advertising dollars to move online, there needs to be a better link between online activity and tracking of advertising effectiveness and offline purchases. Yahoo has long been one of the leaders in developing technology such as behavioural targeting of users on its Yahoo content networks and this test allows advertisers to match their ads to peoples offline shopping habits. The concept seems easy enough as Nectar's database will link in with Yahoo's behavioural advertising system powering its content network, giving advertisers a whole new mass of data to target and profile.
To reduce privacy issues the system is currently opt-in with consumers have to elect to have their Nectar data used in this way, but incentive points had drawn around 20,000 consumers when the sign up started earlier in February. The platform seems very similar to Facebook's Beacon which was shut down due to privacy complaints, but does this platform go further by using consumers past shopping habits to decide what ads to show in the future? While user tracking and re-targeting are beginning to be more common they don't draw offline data. The former head of DoubleClick today launched MAGNETIC which is a rebranded search re-targeting platform that gathers its data from search engines and website partners to offer more targeted self-learning ads.
While it seems that advertisers can better target their advertisements to users online, can it led to eventual harm of consumers as is there too much loyalty programs like Nectar know about your life habits. The opt-in feature will satisfy most privacy laws but as this is expanded as more companies seek to sell business insights into their consumer data do you actually have any rights? Late in 2009 AMEX started its consumer data analytics and consulting division and was followed in January by MasterCard who offer Merchants Solutions that package its consumer data and sell it back to marketers and retailers.
The concern is that merchants such as MasterCard can potentially track your purchases online to offline products such as movie tickets and using basic items such as cookies start to build a profile on your behaviour. Each time you visit partner sites MasterCard and its affiliates can begin to learn more and more about how your online behaviours match to offline behaviours. Credit card companies know more than loyalty card and retailers about your purchase behaviours, frequency and even preferences so when you purchase flights at your local travel agent don't be surprised to see matching hotel ads for the same destination or recommendations for travel insurance. So next time you visit a website that seems to match your offline purchases or shopping behaviour remember this article predicted it.