Federal Trade Commissioner Julie Brill is offering online advertisers and direct marketers both a carrot and a stick.
As a keynote speaker to the Direct Marketing Association's "DMA in DC" conference, Ms. Brill said the FTC wants to work with the industry to find agreement on ways to protect the privacy of consumers and promote a "vibrant, innovative, online marketplace."
But she also spoke of recent FTC prosecutions and said the agency is "ramping up enforcement" of those who break federal privacy laws, especially in the expanding new world of smartphones and mobile apps.
"We're going after the players who share online data sloppily," Ms. Brill said.
The commissioner cited successful prosecutions of mobile device maker HTC America, the Path social-networking app and others.
The FTC has also ordered nine data brokerage companies to provide the agency with information about how they collect and use data about consumers. The FTC will issue a report later this year about the disclosures, and likely make new recommendations.
Self-Interest Should Be Your Guide
For now, Ms. Brill's pitch is that data brokers on online advertisers reform themselves voluntarily.
She said self-interest, and retaining customers, should guide the industry. "In the last couple of years, consumers have been much more savvy about online advertising," she said.
Ms. Brill cited a recent Pew Research Center poll that found that 57 percent of app users declined to install one once they found out how much data it shared.
"It's these kinds of consumers, not the FTC that is going to hurt business," she said.
Ms. Brill also said the FTC had not issued updated guidance on dot-com advertising since 2000 and was forced to do so because the smaller screens on smartphones don't allow for proper disclosures
To have "clear and conspicuous" disclosures, she said, advertisers should incorporate relevant information in their claims rather than in a separate disclosure. Information could be kept separately if scrolling isn't needed to see it.
"The key is the net impression of the ad," she said. "As my mother would say 'if you can't do it right, don't do it at all.'"
The FTC commissioner said she's pushing for a new web portal to inform the public on how info-brokers operate and allow consumers to opt out. The website would also allow consumers to access and correct information collected by data brokers.
"Today's biggest threat is the customer who becomes skittish," she said.
The DMA conference, sponsored in part by data brokers like Experian and Acxiom, focused on proposed "do not track" legislation and threats to behavioral advertising and the "data-driven way of life."
Besides attending seminars like "Where are Regulations and Enforcement Headed" and "Privacy in a Data-Driven World," DMA members fanned out on Capitol Hill to lobby lawmakers. But expectations are low, said DMA President Linda Woolley, citing the partisan gridlock.
"I understand where Congress is right now," she said.