Are they or aren’t they using “behavioral targetting” in AdWords or, for that matter, organic search?

Behavioral targetting is a controversial approach to search-driven advertising which attempts to use data collected about a user to customize ads served to that user. In other words, a search engine could try to analyze the contents your not-so-private Gmail or Yahoo mail accounts, your web browsing history, shopping habits, to sketch a profile of you which might help them present ads that a person “like you” may be more interested in.

Even on the face of it, it’s not difficult to see how technically and ethically complicated the behavioral targetting concept might get, with user outrage over privacy concerns and advertiser confusion being just two of the more obvious symptoms.

While the concept isn’t exactly new, evidently the implementation of BT by the major engines still is in it’s infancy. In fact, Google has recently started talking about its own policy on Behavioral Targetting, and offered some guidance to Search Marketers and AdWords advertisers on possible future BT-driven “enhancements” to AdWords, but the message is far from clear.

Although ostensibly written for stock market investors, this article by Vishesh Kumar from the Aug. 5th web edition of financial news site “The Street” attempts to parse Google’s “intricate” position on BT last week and is well worth a read: Google Shuns Behavioral Ad Targeting — for Now

Some interesting quotes from Kumar’s piece:

Yahoo! recently launched a new SmartAds program that will use demographic information about things like gender and age when deciding which ad to display. But Google, for the time being, has decided to steer clear of taking that type of information into account. While a new feature it announced last week will post ads based on the sequence of queries a user puts in — rather than just a single query — the system stops short of drawing on any other information it has about the user.

And though the company plays up its high-minded concern for privacy in avoiding personal information, Google also has a more practical reason. It can do just fine without it.

“Currently, our system incorporates a large number of signals such as the user’s query, the user’s location, type of site, content, and the advertiser’s landing page when targeting and ranking ads,” a Google rep says. “For targeting ads on search result pages, we have seen no evidence to suggest that explicit demographic information from users will substantially improve ad quality or effectiveness.”

The timing of Google’s announcement that it is very concerned about privacy issues may not be a coincidence, either. Its proposed acquisition of online advertising company DoubleClick is being scrutinized by regulators because of privacy concerns. Expressing concerns about user privacy helps cast it in a better light.”