Billboards have caused a bit of a stir lately.
That’s because earlier this week, Clear Channel Outdoor America, one of the world’s largest outdoor advertising providers, announced the launch of RADAR, which allows companies to more effectively and better target their ads. RADAR, which is being rolled out in 11 of the company’s largest U.S. markets, informs companies who saw their ads and how and whether or not they took action on it. The kicker: The companies do this by leveraging location-based and behavioral data from consumers’ smartphones, and it’s sparking new fires in the never-ending tech-privacy debate.
But is RADAR an invasion of consumer privacy?
Yes and no.
Opponents, like Jeffrey Chester, executive director of the Center for Digital Democracy, view RADAR as “incredibly creepy” and “the most recent intrusion into our privacy.”
“People have no idea that they’re being tracked and targeted,” he told The New York Times.
In theory, yes. But practical application would suggest otherwise.
Don’t get me wrong. Consumers, generally speaking, care about the notion of privacy. And, if one were to survey people on whether or not they’d be open to having a third-party provider track their behavior and usage patterns—even if anonymously—on their phones, the majority would likely say “no.”
But consumer behavior says otherwise.
Let’s take an existing and parallel example: third-party keyboard apps such as Bitmoji and SwiftKey, which also leverage location-based sharing. Prior to installing such apps, Apple warns users that “allowing full access will enable the developer to record what you type.” Consumers responded with so many questions that SwiftKey published a blog post about it. “That warning message,” it wrote, “is there to make sure you are aware of what is technically possible before making a decision about whether to trust the developer of a keyboard extension.”
(A quick Internet search for the phrase “keyboard full access privacy” flooded my newsfeed with articles from Apple, TechCrunch, MacRumors, and many others about the topic.)
And yet, I’d put money down that more people have installed the Bitmoji and SwiftKey apps than not due to privacy concerns.
And herein lies the real problem: The scary reality that we should be concerned with is that most users ignore privacy policies, as this Consumer Reports study found of users’ habits on social networking sites such as Facebook.
Still, this doesn’t give Clear Channel a loophole in the privacy realm. If the company’s new tracking technology will serve more relevant and timely advertising to me, then yes, I’m all for more. (More targeted advertising may even result in many of us thinking a billboard’s message is serendipitous—hooray for less clutter!) But, if this data falls into the wrong hands or is used for purposes outside of the specified context, the ramifications and loss of consumer trust could be quite serious.
(For the record, Clear Channel says all data that is collected by the company and its partners—AT&T Data Patterns, PlaceIQ, and Placed—is anonymous and collected on an aggregate, non-individual nor identifiable level.)
Privacy aside, there’s another variable that can either complicate or ease the situation. In ad agency FCB’s work across highly regulated industries—such as financial services and health insurance—it found value, or the perception of value, that consumers are receiving in exchange for “giving up” some portion of their privacy rights to be an essential factor.
Microsoft, in its Consumer Data Value Exchange Study published last year, summed it up as such: Globally, 100% of consumers expressed a willingness to share personal data when receiving cash rewards; 89% when discounts are received; and 65% when earning loyalty points.
The lesson here is that the privacy exchange is two-way: Marketers aren’t the only ones benefitting. Consumers, likewise, need to gain a little in order to give up a little.
This article was written by Jennifer Chiang, SVP and director of strategic planning at FCB, and originally appeared in Fortune.