The digital signage industry is rapidly becoming aware of the privacy issues raised by interactivity and audience measurement techniques. There is, however, no industry-wide consensus about how to address those concerns. Some industry figures agree that privacy guidelines need to be adopted if audience measurement and other digital signage applications are to progress. Others, though, have referred to calls for the industry to be sensitive to privacy as "attacks" and have condemned privacy concerns as a lot of hype over nothing.
(What is digital signage? Please see my earlier post, Digital Wallpaper.)
It is true that no one should blow the privacy issue out of proportion. The industry's present level of privacy infringement is not especially high because only a small percentage of digital signage units have audience measurement, identification or interactive capabilities. Nonetheless, the privacy issue is real, particularly if one considers the big picture of where digital out-of-home (DOOH) media is headed.
The industry trend is clearly towards greater identification and surveillance capability, not less. It is very likely that DOOH media will one day routinely identify individual consumers for the simple reason that it will be profitable to do so. If that prediction is correct, it puts the digital signage industry on a collision course with consumer privacy. All parties would be best served by setting credible, transparent privacy standards before digital signage becomes a center-stage problem.
The long view: Behavioral advertising in real space
Internet marketers use various tools to profile consumers and deliver targeted advertisements to them as they browse the Web. Digital signage has begun integrating tools that can track and profile consumers as well, but the difference is that the targeted advertisements appear in the offline world.
The DOOH industry is experimenting with powerful technologies to enhance audience measurement, interactivity and targeted advertising. The industry's "2.0" stage will likely see a mix of such technologies used in various contexts. Among these are mobile marketing, facial recognition, RFID, GPS, Microsoft's Project Natal, and social networking. Each of these technologies already has the ability to identify individual consumers, track them as they move from place to place, and store detailed information about their preferences and habits.
Over time, identification and interactivity technologies will grow cheaper, more powerful and easier to deploy. Using these technologies, the DOOH industry will be able to deliver highly personalized advertising content to individual consumers. Deployed widely enough in digital signage units, such a system may be profitable to the DOOH industry, just as behavioral advertising has proven profitable on the Internet.
The similarities between online and offline behavioral advertising may be the impetus for privacy regulations that encompass digital signage. Congress held multiple hearings on behavioral advertising in the past year, forcing several big name Internet companies to defend their practices. Although these hearings mostly focused on online activity, that can quickly change as behavioral advertising in the offline context receives greater attention.
When the FTC issued behavioral advertising guidelines last February, one commissioner specifically urged the agency to take a comprehensive approach that addressed online and offline threats to privacy. In April, Representative Bobby Rush introduced a bill that would require information brokers to enact privacy and security measures for personal information held in electronic form. Digital signage companies who identify individuals likely meet the bill's definition of "information brokers."
Outside of government, there is strong public support for privacy measures that give consumers control over their personal information. A substantial portion of the public is very suspicious of surveillance for security purposes, let alone surveillance for marketing. Facebook users have revolted over privacy several times, forcing the company to change its policies. Comments to blog posts and news articles on facial recognition use in digital signage indicate that many consumers have little faith that DOOH companies will protect consumer data.
Privacy can be an enabler, not an impediment, to the DOOH industry
Numerous DOOH companies already take privacy seriously. Some of the major companies using facial recognition audience measurement techniques, such as Trumedia, Quividi and Cognovision, openly publish privacy policies stating they do not retain images or identify individuals. Similarly, some companies that integrate digital signage and mobile marketing, like LocaModa, publish privacy policies. However, not all DOOH services that use facial recognition, mobile marketing, or similar technologies specify what they do with personal information at this time.
Other privacy safeguards will have to depend on the particular technology, what consumer information the unit collects, and the context of its use. While an opt-out might be sufficient minimum protection for anonymous facial recognition data reported in aggregate, an opt-in is more appropriate for any technology that can uniquely identify individuals or their property, such as RFID or mobile marketing. Digital signage companies gathering consumer information in healthcare settings or financial institutions should be aware of how this practice relates to state and federal laws on medical and financial privacy.
By adopting strong privacy protections early on, the digital signage industry can help avoid consumer distrust, the ire of regulators, and the embarrassment of advertisers. It will be cheaper for the industry to integrate privacy into business practices now than it will be to retrofit privacy protections onto existing systems. There's also the matter of consumer trust: it's far easier to keep than to win back.
This article originally appeared in Digital Signage Expo.