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Let's say you're shopping online for shoes. After browsing a few stores for just the right pair, you surf over to an article on your favorite news site. Then, wedged between sunny Saturday and stormy Sunday, you see yet another ad for the shoes. You're not going crazy; you've just experienced the wonder of custom Internet advertising. Targeted advertising has been part of the Internet experience since the late 1990s. Back then, companies tried to reach out to consumers online in much the same way they had on TV: by choosing ads that likely appealed to the broadest part of their audience. In other words, since fly fishing shows featured ads for rods and trips to Alaska, then so would fly fishing Web sites. Then, in the early 2000s, Internet advertising got a little smarter. Companies began using browsing habits and other data collected from users to make ads more personalized, and promotions for shoes and all kinds of other products and services began following people across the Web.
Some activists see the practice as an invasion of privacy since it relies so heavily on the collection of personal information, but advertisers insist that it's harmless. So, which is it? Is custom advertising an invasion of privacy? In order to deliver custom ads, companies first need to know something about you. Clickstream Data. In custom advertising, the term clickstream refers to a record of Web pages you've visited. This data is collected using a tiny text file called a cookie, which a site sends to your computer so it can track your movements among its pages (for a more detailed description of this topic, see "How Internet Cookies Work"). There are two types of cookies: first-party cookies, which are sent by the site domain in the address bar, and third-party cookies, which come from other domains that have embedded ads or images on the page. Marketing companies like DoubleClick, which advertise on sites across the Web, use third-party cookies to compile surprisingly complete records of users' browsing habits.
This information helps them tailor advertising to specific patrons. For example, if a user's clickstream record includes a lot of sports Web sites, he or she may see more advertisements for team jerseys and game tickets, even when viewing something unrelated, like the weather. A 2011 Pew Internet survey found that 92 percent of adults used search engines when online, so it's no wonder that sites like Google, Yahoo! They analyze search terms and user habits to place targeted advertising alongside regular search results and often allow companies to pay them for a higher position among the results for particular keywords. That's why, when you do a search for "sleeping bags," larger outdoor companies often appear first, and advertisements for sleeping bags line the margins of the page. Purchase Data. Ever notice how Web sites like Amazon will recommend items that remind you of other items you've purchased or viewed in the past? That's because online stores often use cookies or user registration to keep track of what you buy -- and even what you put in your cart and later abandon -- in an effort to personalize your shopping experience.
Profile Data. When you create a profile on a social networking site such as Facebook you probably enter information about your age, religion, education, political views, interests and favorite movies, music and books so your friends can get to know you better. What you may not know is that these sites also use that data to provide you with custom advertising. For example, if you list one of your interests as "board games," don't be surprised to see ads for Scrabble, Monopoly or Life. Custom ads aren't only lucrative for businesses; politicians have found them useful as well. Both the Barack Obama and Mitt Romney campaigns targeted Internet ads at potential supporters before the 2012 presidential election. Understandably, Internet users have shown concern about the tactics used by marketing companies who provide custom ads. After all, these companies gather a great deal of information about millions of different people around the world. Then they use it to place ads that can make it seem eerily like someone's looking over your shoulder.
Much of the controversy surrounds the collection of data using third-party cookies, which can help compile a pretty complete log of a user's browsing history. Critics of this practice fear that such records could be combined with identifying information like names, addresses and phone numbers. After all, who wants the fact that you checked out a list of the top 10 hottest women alive floating around on the Web where grandma might find it? It's highly unlikely that such a thing would ever happen, though: Marketing companies are very wary of engaging in such practices, largely because of the criticism it would attract. Some people mistakenly believe that cookies are programs that can plant a virus on your computer or mine your hard drive for personal information. As stated earlier, however, cookies aren't programs, but simple text files that can only be read by the Web site that sent them. Many are used to remember harmless things like your personal preferences for a particular Web site.
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