Privacy Issues Loom for Marketers

Creating Relationships With Kids Under Age 13 Presents Sticky Situations

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NEW YORK (AdAge.com) -- Obesity concerns and predatory behavior in teen-populated online communities like MySpace.com have been dominating the rhetoric around marketing to children and their use of fledgling technologies. Looming in the background of both debates, however, are longstanding questions about privacy -- namely, whether marketers have toed the line in their interactions with the under-13 set.

Six years after the Children's Online Privacy Protection Act went into effect, the online world remains a key area of debate regarding privacy and kids marketing.

Word-of-mouth marketing, a burgeoning area of concern for privacy's guardians, hasn't really reached beneath the teenage demo because few such campaigns are aimed at kids and tweens. This owes less to the dubious ethics of asking them to pressure their peers than to marketers' concerns that children can't execute such campaigns efficiently. And cellphone penetration for under-13s hasn't reached a high enough level yet for watchdogs to sound an alarm about the potential for mobile privacy abuses. "Until more kids actually have cellphones, it's just speculation," says Gary Ruskin, executive director of Commercial Alert.

Even though few major players may have run afoul of COPPA -- Martha K. Landesberg, director of policy and counsel at Web monitor TRUSTe says the Federal Trade Commission has brought only 10 cases under it -- there remains at least some hesitation when dealing with privacy-related issues in cyberspace.

"There's confusion because the medium itself is still so young," says Paul Kurnit, founder and president of KidShop, Chappaqua, N.Y. "With the 30-second TV spot, everybody knows what you have to do. On the Internet, some people still haven't wrapped their heads around the 'permissioned relationship' thing."

Mr. Kurnit is referring to the COPPA provision requiring marketers to obtain parental consent before they can collect, use or share personal information about kids for marketing purposes. This extends basically to everything from asking for a date of birth to sending fan-club e-mails.

Shutting the door
Some marketers seem to have ducked this mandate, albeit in a legal manner.

"When some people heard about this, they basically jumped out of the lake, ran away and climbed up a tree. They simply shut out anybody under 13," says Denise Tayloe, founder and CEO of Privo, which helps marketers get their youth-registration houses in order. "It's like 'You're 12? Nope, no Hilary Duff e-mails for you.' "

The predictable result: Kids fib about their ages to access online interactions restricted to those 13 and older.

Another particular area of concern exists regarding the line between editorial content and advertising. "It's harder for children to tell the difference on the Web than it is on TV," says John Feldman, a partner at law firm Reed Smith. "On TV, you get bumpers between commercials and programming. How do you do that on the Internet?"

Asked how marketers have confronted this problem, he responds, "I'm not sure they have confronted it."

Those experts who believe marketers bear a heavier responsibility when interacting online with children point to the ease of information collection and retention. Unlike several other groups, the Electronic Privacy & Information Center hasn't called for a blanket ban on marketing to kids. But for any number of reasons -- the inaccuracy of data collected via the Web, the fact that such information can be retained cheaply and easily for decades -- the organization believes that no data on any minor child should be retained in any database, period.

EPIC Associate Director Lillie Coney notes that not all children have the capacity to understand why entering their address and birthday in a public forum might not be a great idea. "Young people are not cautious about the information they share with others," she stresses.

But, for example, could a blog created by a 12-year-old come back to haunt that individual down the road? "The moments of our childhood affect the opportunities presented to us later in life," Ms. Coney states flatly.

Furthermore, EPIC paints instilling respect for privacy, online and off, as an important part of parental responsibility. "Parents know to tell their kids not to give an answer if a stranger walks up to them and says, 'Where do you go to school?' But that's exactly what's happening to them on the Internet," Ms. Coney says.

Marketers and media outlets approached for this article wouldn't discuss their concerns about kids privacy, but the question persists about how should the Nickelodeons, Walt Disneys and Hasbros of the world proceed on the online front. Experts advise a mix of caution and common sense.

On the most basic level, a tidy rule for marketers to follow might be: "If you can't protect it, don't collect it." They should strive only to compile and retain a bare minimum of information -- less is more -- and might consider time-stamping their relationships with children.

Say that a marketer has jumped through the COPPA hoops and secured permission to send e-mails about a cartoon character to a child. Rather than extend this relationship indefinitely, privacy experts suggest capping it at a certain number of months. At the end that period, the child's parent would be informed that the relationship will expire (and the data will be expunged) if not renewed.

When giving notice to parents, marketers need to phrase their requests quite delicately. Generalities like "Will you allow us to send periodic messages to your child?" tend to raise eyebrows; consent notices that include specifics -- "Will you allow us to send your child an e-mail including information about new video games once a month?" -- generally will not.

Greater vigilance
Marketers should be vigilant about the firms with which they partner. Ms. Tayloe gives the example of a company sending e-mails about a singer to children as young as 7 or 8. "The e-mails say, 'Come check me out on MySpace,' but you have to be 14 to have an account there," she says. "Why are you sending them to an environment where they're not legally allowed to participate?"

The Children's Advertising Review Unit of the Council of Better Business Bureaus probably won't add much to the privacy debate when CARU completes a review of its ad guidelines within the next few months. Director Elizabeth Lascoutx says issues around advergaming and the appropriate use of licensed characters are likely to rank higher, though she adds, "My guess is that the revisions will be minor."

The privacy issue isn't likely to disappear entirely. Ms. Landesberg says that despite COPPA's effectiveness, privacy will continue to bubble near the surface of the debate over marketing to children. Though she doesn't expect any major companies to experience a privacy fiasco anytime soon, she calls on them to distinguish themselves through continued good conduct.

"Marketers are extremely creative, but so are the bad guys," she says. "There are ways to do this responsibly, and I think most people's hearts are in the right place."

5 flashpoints for children's privacy issues

  • Marketers will continue to struggle with delineation between advertising and editorial on the Internet.
  • Fewer marketers will duck COPPA's parental-consent requirement by closing their sites to children under 13.
  • The upcoming revision of CARU guidelines will address privacy concerns only peripherally -- COPPA's success has prompted CARU to focus its concerns elsewhere.
  • In a midterm election year, politicians could well latch onto children's privacy as a campaign issue -- yet another reason for marketers to continue their online vigilance.
  • Potential class-action plaintiffs, as always, will monitor the privacy area; the threat of large-scale suits will be as much of a deterrent as COPPA.

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