4A's Conference

4A's Panelists Encouraged by FTC's Stance on Industry Self-Regulation

But ANA's Liodice Says Agency Does Not Have a 'Workable Definition' of What Constitutes Tracking

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Bob Liodice, president-CEO of the Association of National Advertisers, today said he was encouraged by the Federal Trade Commission's stance on self-regulation as it pertains to privacy and the ad industry, but was ultimately dismayed at the agency's position on behavioral tracking.

Mr. Liodice, who spoke during the last panel of the 4A's Transformation Conference in Austin, Texas, was referring to comments made by David Vladeck, director of the FTC's Bureau of Consumer Protection. Addressing concerns over consumer privacy and protection in an era of online data collection, Mr. Vladeck said the FTC is in favor of industry self-regulation, adding that consumers should be able to opt out of behavioral marketing and data collection, similar to the national Do Not Call list. The FTC's proposed "Do Not Track" effort affects marketers that engage in behavioral marketing, particularly online.

And while Mr. Liodice and others on a panel devoted to regulation issues that was moderated by Ad Age editor Abbey Klaassen were encouraged by the FTC's stance on self-regulation, there's a caveat: the FTC doesn't have "a workable definition of tracking," Mr. Liodice said.

Speaking from an agency perspective, Carla Michelotti, exec VP-chief legal, government and corporate affairs officer for Publicis Groupe's Leo Burnett, said all agencies are individually responsible for understanding an agency's role in self-regulation when it comes to consumer privacy.

"There are different responsibilities for different functions," said Ms. Michelotti. "Every agency needs to do an analysis of where its data is coming from. ... The self-regulation program is a very good program, but you need to read, understand and know where an agency fits in."

As for the nascent role of the chief privacy officer at agencies and marketers, Eric Mower, chairman-CEO of agency Eric Mower & Associates, views privacy as "part of stewardship -- any organization dealing with consumer data has a responsibility. Voluntary self-regulation is just that -- you do it because you feel responsible," he said.

Ms. Michelotti's concern about a chief privacy officer is the idea that one person could be held responsible for a company's privacy transgressions. "There should be broad-based corporate responsibility, versus personal liability."

Of course, engaging in self-regulation goes beyond simply being technically on the right side of the self-regulation fence. Mr. Liodice pointed to the self-regulatory efforts on the part of food marketers in their commercial messages to children. "Advertisers were technically correct in adhering to self-regulation in the marketing of food to kids -- but were losing in public opinion. So the government gave them a kick in the pants."

As for what should be on agencies' and marketers' behavioral advertising self-regulation to-do list, Lee Peeler, president-CEO of the National Advertising Review Council, said that reading up on FTC reports is crucial, as the FTC generally looks for any type of deception. The same basic rules for TV advertising apply to online advertising, including social media. "If you haven't signed up for voluntary program, we'll contact you," he said.