STEVE INSKEEP, host:
We talk about technology on Mondays. And today, we're going to look at new tools for behavioral marketing. That's the term for customized ads based on predictions of what you are most likely to buy next. The Internet has long promised it'll be able to provide this kind of one-on-one marketing based on personal data. And now it appears to be here.
It's a subject that author and Web consultant Adam Greenfield has given a lot of thought to, and he's on the line from New York.
Welcome to the program.
Mr. ADAM GREENFIELD (Author, "Everyware: The Dawning Age of Ubiquitous Computing") Thank you, Steve.
INSKEEP: Can you just explain how this works?
Mr. GREENFIELD: Basically, they have a fairly crude model of who do the user is based on things like your gender, your location, possibly things that you've been interested in the past.
INSKEEP: When you say who the user is, you're talking about on any given computer terminal or on your personal laptop, they - meaning the advertiser -is tracking who you are and what you like.
Mr. GREENFIELD: That's right. And increasingly, they're able to draw on a number of different databases to build a fairly elaborate model of the user.
INSKEEP: I want to ask about a really simple version of this. I go on one of those book-selling sites. And I'm looking at a particular book, and a site is going to tell me that people who bought this book also like these other books, which maybe you would like to buy. Is that a form, a very simple form of behavioral marketing?
Mr. GREENFIELD: In a sense, it is. That's right. And I think it's a great example because it shows how skeptical we should be of the claims that are being made for behavioral marketing. And I'll tell you why. Amazon - you know, me, personally, Amazon has 10 years of data on me. I buy, on average, about a book a week from Amazon. So, if there's any organization in the Web world that should be able to have a highly detailed, highly elaborate, highly accurate model of my behavior and my interests, it would most likely be Amazon. And yet, they're still recommending "Harry Potter" to me…
(Soundbite of laughter)
Mr. GREENFIELD: …which something that there's just no way on earth I would ever purchase.
INSKEEP: Maybe they know you better than you know yourself.
Mr. GREENFIELD: Well, I, you know, I just - I kind of doubt that.
INSKEEP: So this is one very simple version of this: A company knows what you've bought in the past, and they try to recommend products based on what they know you've bought in the past, however imperfect that may be. What's another form of behavioral marketing?
Mr. GREENFIELD: What we're seeing here with Yahoo Smart Ads is really something that proposes to do this in real time, that proposes to pull together information about where you live, some demographic facts about you, and some indicators as to your predilections or interests. Yahoo!'s proposing to serve ads on a Web page that are fairly narrowly tailored to your interests.
INSKEEP: I'm looking at Yahoo! right now, and it's, you know, the front page and there's some news and sports here. And there's an ad over on the side. It happens to be for Nordstrom.
Mr. GREENFIELD: Okay.
INSKEEP: Are you telling me that as I spend more time on Yahoo, that various commercial services or Yahoo itself is learning what I look at, what Web pages I go to, where I might live, even and…
Mr. GREENFIELD: That's the theory.
INSKEEP: …and then calculating which is the best ad to stick up in this Nordstrom spot here?
Mr. GREENFIELD: That's exactly right, that it would go from a generic ad that might miss you by a thousand miles. You know, you might have no interest or reason to shop at Nordstrom's.
INSKEEP: Although it does say fall fashion, now is the time. So maybe I should…
(Soundbite of laughter)
Mr. GREENFIELD: See how accurate it's getting?
INSKEEP: So you're saying it might be more a targeted ad, something that really interests me.
Mr. GREENFIELD: Among other things, Yahoo! is doing this - is what's called an auto-opt-in service. So you basically have no way of opting out of this. You're not even necessarily aware that it's being done.
INSKEEP: So what are some things that can be learned about me just as I surf the Web? Someone can learn my name, I suppose. What else?
Mr. GREENFIELD: Well, it's interesting. You leave different kinds of traces in different places. So you might use something like the Nike+iPod Sport kit, which is a sneaker that has an RF ID, a radio frequency identification tag in it, that uploads information about your running times and the calories that you've burned and how far you've run. And that gives you a sort of an indication as to your likely health status.
INSKEEP: This is information that's out there, then, that marketers can grab on to.
Mr. GREENFIELD: Well, theoretically. What we have to do is imagine an environment in the very short term in which all sorts of information is not merely present in these, sort of, discrete silos, but can't be unified in real time into - I don't know whether or not it will be an accurate picture, but a very detailed picture of high-level behavioral patterns, what my social networks are, what my potential affinities are, what my health is. And obviously, you can do a lot more than just serve ads based on that.
INSKEEP: What's to stop people from opting out the old-fashioned way? Just turn off the computer?
Mr. GREENFIELD: Not a thing. The value proposition is fairly clearly the one of convenience, that we will stop bombarding you with ads that are irrelevant to you. And instead, we will target you ads that actually, you know, reflect your choices and your existence on this planet. And I have to think that that's going to be fairly seductive for some people. You know, I myself have a little WiGID in my Web browser that blocks the ads at all to begin with, which is definitely a counter measure that people can take. But that requires just a touch more technical sophistication and effort than a great many users are going to be bothered with.
INSKEEP: Oh, so if you know what you're doing, you can go non-commercial?
Mr. GREENFIELD: Oh, absolutely. It's wonderful.
INSKEEP: If you go to Yahoo! on your computer, what do you see where I see this Nordstrom ad?
Mr. GREENFIELD: I would probably see a white box.
Mr. GREENFIELD: But I…
INSKEEP: Oh, or you're missing the spectacular fall fashions.
Mr. GREENFIELD: Hey, I guess, I have - I won't be (unintelligible) this fall.
INSKEEP: Well, Adam Greenfield, thanks very much for speaking with us.
Mr. GREENFIELD: Thanks, Steve.
INSKEEP: He's author of "Everyware: The Dawning Age of Ubiquitous Computing."