Is the Big Privacy Awakening the Death of Surveillance Advertising?

The last century saw the glory years of advertising. The industry broke boundaries and created the glamourous mystique of the Mad Men era. Consumers knew that they were being sold something and, while individual advertisements were not necessarily entirely honest, they felt that the industry was above board and at least honest about what it was doing. Fundamentally, consumers understood the purpose and bias of the messaging and were free to do with that what they liked.

Since then, advertising models have become more complex – and smarter. Online advertising and social media gave advertisers more insight into their target consumers than ever before. The result is the targeting of consumers without them even realizing it. This has led to a raft of surreptitious marketing tactics, like guerilla marketing, stealth marketing and the use of influencers that mean it is often very difficult to tell if you are receiving a paid for advertisement.

Consumers though are starting to understand how Big Tech and Big Data work with advertisers and make money. As a result, they are learning to value their privacy and private data. This privacy awakening is the beginning of a seismic shift in what activities society considers to be acceptable by Big Tech companies, advertisers, corporate and individual users.

The Rise and Fall of Surveillance Marketing

Big Tech companies ostensibly give their services away for ‘free’ and generate revenue by monetizing the data they collect from users. This data is sold to advertisers who are keen to better focus their advertising and love the way that Big Tech companies can slice and dice the data in a specific and targeted way.

According to Big Tech, this ‘surveillance marketing’ is fantastic for consumers. We ostensibly get totally free access to social media services and, even better, the advertisements we see are relevant to our interests.

Success bred success and the more advertisers paid to get data and access to their highly targeted demographics, the more data the Big tech companies collected, sorted and sold.

Until recently users did not fully understand that this a data marketplace where they trade their data for access to a service[1]. It was never clearly and explicitly stated that they are giving their data to Big Tech companies and that this would be stored, sorted and sold to advertisers and others for profit. Then came Cambridge Analytica.

The Cambridge Analytica scandal in early 2018 was a watershed moment, shining a spotlight on the data practices of Big Tech companies. For many users, it was the first time they became aware of the Faustian bargain they had, often unwittingly, been a part of for many years.

This awareness has only grown since then with a string of data scandals, including Equifax, the fitness app Polar, Marriott and Exactis.

Understanding surveillance marketing led to two main reactions. Firstly, users started to appreciate the huge commercial value in their data which they have been significantly undervaluing. Secondly, users felt violated and that their data has been misused. Unsurprisingly, when Apple started allowing users to opt out of app tracking, 96% of users in the US chose to opt out[2] – a direct rebuke to surveillance marketing.

While the initial backlash was against Big Tech companies, consumer anger is turning against the advertisers that fund and sustain this data marketplace. The rules of supply and demand suggest that, if advertisers aren’t willing to buy and use this data, there would be no financial incentive to continue to collect and store it.

Corporates who advertise on services that surveil their users and track data need to quickly and carefully evaluate whether this fits with their values – do your customers really believe that it is ok for you to secretly track them and their children with the sole purpose of selling them more stuff?

Once considered a benign marketing activity, this is now being viewed by consumers as improper, intrusive surveillance. This clever Apple advertisement[3] illustrates this shift perfectly. It may be the beginning of the end of this practice as consumers look to take back control of their data.

This is manifesting in different ways, including with more (and more stringent) data regulation[4], more attention on protecting data, growing awareness of how data can be lost, stolen or given away and, perhaps most notably, a growing desire to understand what information and data is available online and to take back control of this.

The Fall and Rise of Digital Resilience

The term SEO[5] has, over time, taken on sinister overtones – thanks largely to a very effective PR campaign by Google, Wikipedia and others. We were persuaded by these companies that they – and not us – know better and should be the holders and controllers of our data and information online and thus the arbiters of our privacy and reputation.

According to this narrative from Big Tech, individuals and companies who sought to take control of their own data online were ‘gaming the system’ and this was the big problem online that needed solving – never mind the slander economy, cyber-bullying, fake news or the myriad other issues.

We bought into this and let these companies decide what people should see about us – something we would never allow in our real lives. There is now a growing recognition that it should be up to each of us to decide how we want to be viewed and what information to share about ourselves regardless of whether that is online or IRL.

This is increasingly leading to individuals and companies taking pro-active steps to take control of their data online and a growing acceptance that this is both proper and essential to reduce the amount of fake news, prevent others profiting from your data and protect you from online attacks. The recent New York Times exposé[6] on the slander industry thrust this issue into the spotlight. One comment particularly stands out:

In the article the journalist discusses how the attacker went after her online when she was writing the piece and noted that “For someone like me, with lots of pre-existing Google results, posts on sites like BadGirlReports barely show up. But for people with less of an online presence, like Mr. Babcock, the sites still dominate search results.”

This highlights how building and maintaining a resilient digital profile protects you from these types of attacks and allows you to decide what parts of yourself to share with the world.

In response, Google announced measures to combat the slander industry. Their reason for taking steps perfectly illustrates what actually matters to Google:

The Google executives said the company was not motivated solely by sympathy for victims of online slander. Instead, it is part of Google’s longstanding efforts to combat sites that are trying to appear higher in the search engine’s results than they deserve.

“These sites are, frankly, gaming our system,” Mr. Graff said.”[7]

The Shift

The result is a remarkable shift in views. What was until very recently considered entirely acceptable – surveillance marketing – very quickly fell from grace. Simultaneously, what was considered to be undesirable – taking steps to own your online privacy and reputation – is now viewed as a proper and necessary way to take back control of your data and privacy.

What’s next?

These trends are likely to spark a chain reaction of questions into other areas of digital privacy. These include:

  1. Will we see more companies putting their customers’ privacy at the heart of their service or products?

There are already green shoots of a pro-privacy industry where respect for privacy is a central selling point. Apple’s sales pitch is based on their privacy credentials[8] and services like DuckDuckGo[9] focus on the fact that they do not track users.

  • Will we see consumers boycotting companies that don’t stop funding and supporting surveillance?

Many major corporations currently use some form of online marketing that relies on tracking users to identify targets. This is a corporate reputation issue for companies which needs careful examination. How will companies square their involvement with surveillance marketing with their core values? Will companies look to pro-actively end this type of marketing and rely on these steps to show their support for consumer privacy?

  • Will we see the rise of paid-for social media?

As a primary income stream looks likely to decline for social media companies, perhaps users will get an option to either (a) pay for a service and then not give  data or (b) get the service for free and then give data in exchange. This would be a much more transparent model.

  • What regulation are we likely to see?

The growth in regulation targeting data collection and use is likely to continue, but regulating a global industry has challenges. Will there be any global cooperation, or will the current patch work of regulation continue? What regulation will we see in the US an especially important market as the home base for many Big Tech companies.;

All we know for sure is that online privacy and reputation are on everyone’s mind and interesting times lie ahead.

Allan Dunlavy is a partner at Schillings, based in London.


[1] This includes any number of ‘free’ services, such as social media, games or news providers

[2] https://arstechnica.com/gadgets/2021/05/96-of-us-users-opt-out-of-app-tracking-in-ios-14-5-analytics-find/#:~:text=It%20seems%20that%20in%20the,the%20wake%20of%20iOS%2014.5

[3] Note: I have not investigated whether this advertisement came to my attention online as a result of my interest in privacy issues being tracked and surveilled; that would of course be supremely ironic.

[4] See for example the GDPR, UK GDPR, and the CCPA

[5] Search Engine Optimization

[6] https://www.nytimes.com/2021/01/30/technology/change-my-google-results.html & https://www.nytimes.com/interactive/2021/04/24/technology/online-slander-websites.html

[7] https://www.nytimes.com/2021/06/10/technology/google-algorithm-known-victims.html

[8] https://www.youtube.com/watch?v=FbRUQRmvC4U

[9] https://www.ispot.tv/ad/O1yo/duckduckgo-none-of-our-business

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