Online ad industry goes on the offensive with new study

An online advertising group is going on the offensive, providing lawmakers and regulators with data about online advertising and tracking through a new study touting the benefits of data-driven marketing on the U.S. economy.

The Direct Marketing Association (DMA), which represents online advertisers and other “data-driven marketers,” released a study Monday that said data-driven marketing led to $156 billion and 675,000 jobs in the U.S. in 2012.

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According to the study, commissioned by the DMA’s Data-Driven Marketing Institute and conducted by Harvard Business School Professor John Deighton and Columbia University Adjunct Professor Peter Johnson, 70 percent of that economic contribution comes from companies being able to exchange data.

The study is a response to an increased regulatory interest in online tracking and data-driven marketing rather than one specific action by one lawmaker or regulator, DMA Vice President of Government Affairs Rachel Thomas told The Hill.

The online ad industry is “often on the defensive with bills coming out and investigations being conducted,” she said. The DMA is hoping to change that and play a role in informing policy discussions by releasing this study, she continued.

During a press event, DMA CEO Linda Woolley discussed a recent California privacy ballot initiative that was “threatening to stop the collection and use of consumer data.”

The initiative, which would have added additional privacy protections to the state constitution and was recently dropped, became a possibility while the study was being conducted, Thomas said.

“We certainly don’t expect it’s gone forever.”

Thomas and the study’s summary talked about recent and ongoing investigations into the data broker industry, including ones being conducted at the Federal Trade Commission (FTC) and in the Senate Commerce Committee.

While this study wasn’t conducted in response to those investigations, Thomas said the data will help inform those lawmakers and regulators. The impact of data-driven marketing on the U.S. economy is “incredibly relevant to the kind of questions being asked” by the FTC and Senate Commerce Committee Chairman Jay Rockefeller (D-W.Va), she said.

The study will also help inform the House Privacy Working Group, which is conducting a series of meetings with consumer data firms to learn more about online privacy, including a meeting with the DMA that had to be rescheduled due to the shutdown, Thomas said.

“We will definitely make sure that the whole group and all of the Members of Congress have the findings of this study.”

Woolley said her group welcomes being associated with the term "data," though some are quick to dismiss data-driven marketing as intrusive and dangerous to users' privacy.

"There is a fearful factor around the word 'data,' " she said. "We decided that we're going to embrace that term."