Cross-Device Tracking: The New Frontier in Interest-Based Advertising
The FTC may start to scrutinize marketers that engage in cross-device tracking. Advertisers engaged in cross-device tracking should review their online disclosures to ensure that the tracking is adequately described.
What’s the News?
The Federal Trade Commission recently hosted a public hearing on “cross-device tracking.” The agency invited representatives from the advertising industry, academia, and consumer protection groups for a discussion on this increasingly prevalent data collection practice. The hearing shows that cross-device tracking is clearly an area of interest for the agency, and signals the possibility of increased scrutiny from regulators. Consequently, advertisers engaged in cross-device tracking should review their practices to ensure compliance with applicable laws and self-regulatory principles.
What is Cross-Device Tracking?
The proliferation of devices capable of connecting to the internet has created a challenge for advertisers. Gone are the days when you could obtain an accurate picture of a consumer’s online activity simply by collecting the cookies from his or her home computer. Today, when a single individual often owns numerous “smart” devices, monitoring just a single one gives the advertiser an incomplete picture. Cross-device tracking refers to the efforts by advertisers to identify all of the smart devices used by specific consumers—smart phones, laptops, tablets, and more—providing a full cross-section of that consumer’s interests in order to most effectively target ads.
Advertisers do this in two main ways. The first, called “deterministic” tracking, is performed by platforms, such as Facebook and Instagram, that require users to login before using their services. This allows the platform to link up all of the devices connected to a single account. Lacking such a platform (or access to this data), most advertisers rely on “probabilistic” tracking. Under this approach, advertisers collect an immense amount of data about users’ internet behavior—device type, operating system, IP address, and more. Comprehensively analyzing this data, advertisers are able to make probabilistic determinations about whether certain devices are used by the same consumer.
Advertisers do this in two main ways. The first, called “deterministic” tracking, is performed by platforms, such as Facebook and Instagram, that require users to login before using their services. This allows the platform to link up all of the devices connected to a single account. Lacking such a platform (or access to this data), most advertisers rely on “probabilistic” tracking. Under this approach, advertisers collect an immense amount of data about users’ internet behavior—device type, operating system, IP address, and more. Comprehensively analyzing this data, advertisers are able to make probabilistic determinations about whether certain devices are used by the same consumer.
What Do Advertisers Need to Know?
Many, especially academics and consumer protection groups, have expressed concerns about the amount and type of data collected through cross-device tracking. While the FTC has never brought an enforcement action based on an advertiser’s cross-device data collection, the agency’s recent hearing signals the practice as an area of increased interest, and the likely subject increased scrutiny.
At the hearing, a representative from the FTC’s Division of Privacy and Identity Protection stressed the importance of transparency by companies utilizing cross-device tracking. As such, advertisers engaged in this practice should clearly disclose on their websites that data collected from one device may be aggregated with other data and used to serve ads on separate devices. In addition, advertisers should review their data collection practices for compliance with the Digital Advertising Association’s recently-released guidance, which explains how the self-regulatory group’s existing transparency and user choice standards apply to cross-device tracking.
At the hearing, a representative from the FTC’s Division of Privacy and Identity Protection stressed the importance of transparency by companies utilizing cross-device tracking. As such, advertisers engaged in this practice should clearly disclose on their websites that data collected from one device may be aggregated with other data and used to serve ads on separate devices. In addition, advertisers should review their data collection practices for compliance with the Digital Advertising Association’s recently-released guidance, which explains how the self-regulatory group’s existing transparency and user choice standards apply to cross-device tracking.
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