What does Spotify's decision to share user data mean?
A recent Spotify ad campaign plays on how well the digital music-streaming company knows its users' tastes. The ads, found plastering New York City subways, showcase Tweets where listeners extoll how a 鈥� 鈥渓ike former-lover-who-lived-through-a-near-death experience-with-me well.鈥�
But Spotify will no longer just use this intimate knowledge of a user鈥檚 musical palate to generate personalized playlists. It's now using that information as a powerful leveraging tool for advertiser dollars: Spotify that it is opening up user data collected from its 70 million free subscribers for programmatic, automated advertising.
There is an important difference between this move and cookie-based targeted advertising, which tracks users' web histories across platforms. Spotify has not said that it will share the unique identities of users with advertisers. Instead,聽 is limited to information like listeners' age, gender, location, music preferences, and some behavioral habits. This information will enable advertisers to pinpoint specific demographics for their ads on Spotify. Buyers will bid on ad spaces in real time鈥� a聽trail-blazing step in the digital advertising world, and an example of the many ways digital companies wield the massive amounts of data that they have at their fingertips.
Spotify鈥檚 new private marketplace is a boon to advertisers who work with one of the that Spotify has partnered with for this program: AppNexus, Rubicon Project, and The Trade Desk. Advertisers who fall under their umbrella can now use the platform to bid on audio ad spots, according to a press release on the Spotify site.
On the other side of the earbud, consumers will hear advertisements tailored to them 鈥� or at least to who marketers think they are.
Those in the marketing world have repeatedly suggested that users like and benefit from this data-driven personalization of their digital experience, be it in advertisements or search results. But the data suggests something different.
A 2012 study by the Pew Center for Global Research found that nearly three-quarters of users said that collecting user information to personalize search results is 鈥�.鈥� Nearly 70 percent felt the same about having 鈥渙nline behavior tracked and analyzed鈥� for the purposes of targeted advertising.
While this kind of data collection takes place across the board in the digital world, consumer protection advocates feel that the use of user data should be at the discretion of the individual, not the company.
鈥淚f, as advertisers claim, consumers are truly interested in receiving targeted ads, then they can affirmatively choose to do so, but the default is set the other way around because advertisers know that many people will not want to agree to that,鈥� Susan Grant, the director of consumer protection and privacy at the Consumer Federation of America, tells 海角大神. She adds that 鈥渙pt-out鈥� policies for data usage are often difficult to find and complete.
Or, in some cases, a digital company鈥檚 policy about collecting and sharing user data is more along the grain of a 鈥渢ough luck policy,鈥� meaning that if you don鈥檛 agree to the terms you can鈥檛 use the service, says Joseph Turow, associate dean for graduate studies at the University of Pennsylvania鈥檚 Annenberg School for Communication.
Professor Turow published research last year that was instrumental in debunking the idea that Americans accept online and in-store data collection because the targeted marketing gives them benefits.
Instead, his study found that consumers, particularly those who are well-aware of the techniques of data collection, accept it for a very different reason.
The study showed that 鈥渢he more you know, the more you tend to be resigned鈥� to the inevitability of data collection, Professor Turow tells the Monitor. 鈥淲e suggest that that鈥檚 because people feel that they have no capacity to do anything about it.鈥�
Turow proposes several solutions to the current state of largely unchecked data collection and selling, including stricter government regulations, and privacy agreements that are expressly emailed to users for them to review outside of the heat-of-the-moment as they download an app to use.
And as for agreement to those policies? They shouldn鈥檛 be a binary in or out, Turow says, but based on negotiation between company and consumer: "'You can keep my data for first party, but I don鈥檛 want third parties taking my data,'" for example.聽
As it currently stands, companies聽like those that Spotify is partnering with can compile information across platforms to create a profile about a person for advertisers to access and use.
Spotify鈥檚 agreement to work with these programmatic, ad tech companies has a caveat important to users' privacy: it is based on demographics not identification of user identity. Essentially, advertisers can pinpoint users鈥� characteristics within Spotify, but will not follow them off the platform. However, language on Spotify's advertising page indicates that Spotify itself tracks 鈥渂roader interests, lifestyle, and shopping behaviors鈥� of users with data from third-party providers.
So while the streaming site's new arrangement doesn't mean that listeners will be hearing an audio ad for a pair of sneakers that they just browsed online, Spotify users will certainly be able learn more about how they are viewed as a market demographic 鈥� assuming they don鈥檛 mute their ads.
