The uncanny valley of advertising

From an economic point of view, improvements in ad-targeting technology seem as though they’re pretty obviously Pareto-optimal: everybody benefits. Advertisers get to waste fewer of their ad dollars putting messages in front of people they don’t want to reach; publishers get to charge more money; and consumers get to see only things which are germane and relevant to them.

So why is it that many people hate ad targeting, and hate being served targeted ads?

Part of the reason, I think, is just that targeted ads are better at getting our attention than non-targeted ads — but they’re still an unwelcome distraction from whatever it is we’re wanting to read. Most of us have become pretty good at unconsciously ignoring advertising, especially online. (Often I find myself looking hard for a big special report on a website, because it’s presented on the home page in much the same way as an ad might be, and so I ignore it, in much the same way as it’s easy to miss the big letters spelling out continent names on a world map.) Every time there’s an improvement in targeted advertising, it cuts through that wall and annoys us anew before we slowly learn to ignore it over time.

Eventually, advertisers will be able to get much smarter than they are right now, and the ad-serving algorithms will stop being dumb things based on keyword searches, and will start being able to construct a much more well-rounded idea of who we are and what kind of advertising we’re likely to be interested in. At that point, when the ads we see are targeted to us based on much more than the content of our emails or the goods that we shop for online, they probably won’t feel nearly as creepy or intrusive as they do now. But for the time being, a lot of people are going to continue to get freaked out by these ads, and are going to think that the answer is greater “online privacy”. When I’m not really convinced that’s the problem at all. Read more at blogs.reuters.com