Consumer Privacy vs. E-marketing/E-targeting Data

As Professor Roberts and I found out, participating on this blog now means new users must create a Google account in order to post.  Besides a valid email address, birthdate and gender are now required.  Also, after you validate your email address with Google, you land on a page asking for your cell phone number. What other ways is Google trying to collect detailed personal data? Their new collective privacy policy and single sign-in process is an effort to chase after Facebook Connect and streamline behavioral data collection on each user.

Google and Facebook have had run-ins with its users, privacy advocates, and various governments regarding data protection and privacy issues, but the value of personal data in the form of online advertising’s rich revenue stream will only continue to drive user acquisition, data collection, and new online ad channels. With its 845 million users, Facebook has yet to tap its ad potential in mobile devices, but it’s on their radar.

What was interesting to read today in CNN’s review of Facebook’s IPO filing was that privacy is a key concern:  (1) “Facebook usage -- and therefore, the company's finances -- could dip if the users become concerned with their privacy options on the site”; (2) “…if Facebook improperly discloses personal data or if hackers access data, its reputation is expected to take a hit.”  Let Facebook's upcoming actions speak for themselves.

So, what do we make out of all this customized advertising to individuals?  Does it actually get consumers to react/buy more?  At what point do consumers feel a line has been crossed?

At this point, I’m far more comfortable with cookies dropped in from sites I visit which allow for ad retargeting. We can delete cookies but can we really effectively delete data on Google or Facebook?