Dotting the I & T of Pixel Tracking

October 25, 2010 Digital Media Solutions

I Love PixelsA class-action lawsuit against Facebook in 2009 for its “Beacon” advertising program that was settled last December recently resurfaced in a recent article in MediaPost. The article provides some details about a recently submitted appeal to the ruling.  That appeal came from Ginger McCall, a Facebook user, and also a lawyer with the Electronics Privacy Information Center. The Beacon program used web beacons to track peoples’ online purchases with participating retailers and then displayed some of those, without the Facebook users’ consent, on their Facebook profile pages. The settlement requires Facebook to pay $6MM to launch a new privacy protection foundation, to shut down the Beacon program started in 2007, and to pay damages of $1,000 to $15,000 to less than 20 people named in the official complaint.

One of the areas of the settlement that are called out in the appeal is that Facebook has placed their Director of Public Policy as one of the three members of the three-person board of the privacy foundation being created.  According to the article by Wendy Davis, “McCall further alleges that the resolution is inadequate because it doesn’t provide users with monetary compensation, except for the 19 people who were named in the complaint and will receive amounts ranging from $1,000 to $15,000. McCall argues that some consumers — herself included — are potentially entitled to monetary damages on the theory that Facebook violated the federal Video Privacy Protection Act when it shared information about people’s activity on Blockbuster.com. The federal video privacy law prohibits companies from disclosing information about people’s movie rentals and provides for damages of $2,500 per violation.”  The biggest complaint about the Beacon program from privacy advocates was that it was opt-out in nature.  Rather than being a program that Facebook users chose to join it was a program that they had to take several steps to opt-of of using.

I think the most interesting part of this project is how it brought to light the use of web beacons on the internet, often just called “pixels” in the lead generation world.  Beacons have always been mentioned in privacy policies, but how many normal internet users really understand what a web beacon is and what it does?  Not many, but they are everywhere.  When we use the term pixel it sounds even more innocuous.  What harm is there from a dot on a page that’s so small you can hardly see it?  Potentially a lot, but in in a real Catch 22, beacons and pixels are also used to safeguard internet users’ privacy as well.

In the move toward better compliance and monitoring for online advertising, pixels or web beacons have been discussed as a solution for confirming that leads are actually generated from the pages where publishers say that they were. Pixels could capture information submitted in an online form and tie that together with the impressions of the form and thank you page served to the prospective customer. By tracking form impressions and thank you page impressions the pixels would be able to monitor conversion rates from form views to submitted leads and thereby help to indicate when those conversion rates are significantly outside of the normal range.  This helps marketers look out for large volumes of unqualified traffic being driven to their lead form pages as well as suspiciously high conversion rates which might indicate a call center is actually filling in the lead form or incentives are being used by the publisher. 

Beacons and pixels can also capture IP addresses of users who visit web pages where they are hidden in the code. This may seem scary, but what if someone goes online with your credit card and starts making purchases or for whatever reason starts opting your name and email address into web forms. If there is a beacon on that page and the IP address being used is captured then that IP address can be used by authorities to track down the person who was making the fraudulent purchases and either stole your credit card or somehow got your personal information.  Without this online fingerprint tracking down fraud in online advertising or identity theft online would be next to impossible. So by giving internet users the choice of whether to use beacons or web pixels might give them a feeling of security, in many respects, the opposite is true and it only puts them more at risk. Clearly, the difference in the Facebook lawsuit was the fact that users were not given the ability to keep their private information…, well, private.

About the Author

Digital Media Solutions

Founded by a team of lifelong athletes, Digital Media Solutions (DMS) is an industry leader in providing end-to-end customer acquisition solutions that help clients win in their business ventures and realize their marketing goals. The company’s set of proprietary assets and capabilities in the world of performance marketing and marketing technology allow clients to meticulously target and acquire the right customers. DMS relentlessly pursues flawless execution for top brands within highly complex and competitive industries including mortgage, education, insurance, consumer brands, careers and automotive.

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