Targeted online advertising – are you aware of how it works?

A couple of weeks ago, I was looking at flights and hotels for a trip to Reykjavik this January. One of the websites that I visited was hotels.com, following a link from the Tripadvisor website.

This morning, I read an article on the Guardian website about the recent overhaul of the Independent website. At the foot of that article was the following advert:

Is it simply a coincidence that the advert the ad server served up (perhaps based on my Google search history) happened to be for hotels in Reykjavik from one of the websites that I visited when booking that trip?

Or does behavioural advertising now go deeper than I thought, and was this served up by hotels.com based upon my recent searches on the hotels.com website?

How does the system work?
Delving into the Guardian’s privacy policy, it appears that it is the latter.

The Guardian is a member of an online behavioural advertising system provided by a company called Audience Science. Audience Science appears to have many partners – from media/news sites to retailers (although hotels.com doesn’t appear to be on the list of advertisers, it is mentioned in a recent press release), each of whom share information on your use of their websites to allow the others to provide targeted advertising.

What I hadn’t previously considered, and find slightly disturbing about this is that the (very wide-ranging) list of partners in Audience Science’s network will continue to expand. However, once you’ve opted in to the system and accepted the cookie, you are unlikely to be aware of subsequent changes (or really have much idea about what information is being shared and with whom). This means that you could be using one website unaware that your browsing habits could subsequently influence advertisements served up on another site. There is no “Audience Science member” flag.

Retargeted advertising
But I don’t think that the advert I saw this morning was served up through the Audience Science system. I think it was another system used on the Guardian website called “retargeted advertising”, provided by an organisation called Criteo. Here is what the Guardian’s privacy policy says about it:

For example, if you have visited the website of an online clothes shop you may start seeing ads from that same shopping site displaying special offers or showing you the products that you were browsing. This is allows companies to advertise to website visitors who leave their website without making a purchase.

Again, I don’t ever remember consciously opting in to this system. Clearly, I must have accepted a cookie at some point (or passively accepted hotels.com’s privacy policy), but wasn’t aware that by doing so hotels.com was going to chase me around the Internet.

Interestingly, according to Criteo’s privacy policy, the only way of opting out of the Criteo program is to accept a permanent cookie. So if you don’t like cookies, but don’t like your Internet usage being tracked then tough.

Maybe the European Commission is right about the lack of transparent information for users and the recent change to laws governing the use of cookies isn’t so crazy after all?

What do you think? Is behavioural advertising A Bad Thing? Do you think it impedes on your privacy? Is it ok provided that you understand how it is being used?

PS I got the Hotel Thingholt much cheaper on Expedia.

PPS Luckily, the trip wasn’t intended to be a surprise.

PPPS The Internet Advertising Bureau allows you to centrally control your behavioural advertising preferences for services provided by its members here.