Citizens' Issues
Why online tracking is getting creepier

The merger of online and offline data is bringing more intrusive tracking

The marketers that follow you around the web are getting nosier.

Currently, many companies track where users go on the Web—often through cookies—in order to display customized ads. That's why if you look at a pair of shoes on one site, ads for those shoes may follow you around the Web.

But online marketers are increasingly seeking to track users offline, as well, by collecting data about people's offline habits—such as recent purchases, where you live, how many kids you have, and what kind of car you drive.

Here's how it works, according to some revealing marketing literature we came across from digital marketing firm LiveRamp:

A retailer—let's call it The Pricey Store—collects the e-mail addresses of its high-spending customers. (Ever wonder why stores keep bugging you for your email at the checkout counter these days?)

The Pricey Store brings the list to LiveRamp, which locates the customers online when the customers use their email address to log into a website that has a relationship with LiveRamp. (The identity of these websites is a closely guarded secret.) The website that has a relationship with LiveRamp then allows LiveRamp to "tag" the customers' computer with a tracker.

When those high-spending customers arrive at, they see a version of the site customized to "show more expensive offerings to them." (Yes, the marketing documents really say that.)

Tracking people using their real names—often called "onboarding"—is a hot trend in Silicon Valley. In 2012, ProPublica documented how political campaigns used onboarding to bombard voters with ads based on their party affiliation and donor history. Since then, Twitter and Facebook have both started offering onboarding services allowing advertisers to find their customers online.

"The marriage of online and offline is the ad targeting of the last 10 years on steroids," said Scott Howe, chief executive of broker firm Acxiom at a conference earlier this year.

Last month, Acxiom—one of the country's largest data brokers, which claims to have 3,000 data points on nearly every U.S. consumer—agreed to pay $310 million to purchase onboarding specialist LiveRamp. Acxiom and LiveRamp declined to comment for this article, citing the need to remain quiet until the acquisition is complete.

Companies that match users online and offline identities generally emphasize that the data is still anonymous because users' actual names aren't included in the cookie.

But critics worry about the implications of allowing data brokers to profile every person who is connected to the Internet. In May, the Federal Trade Commission issued a report that found that data brokers collected information on sensitive categories such as whether an individual is pregnant, has a "diabetes interest," is interested in a "Bible Lifestyle" or is "likely to seek a [credit-card] chargeback."

Previously, data brokers primarily sold this data to marketers who sent direct mail—aka "junk mail"—to your home. Now, they have found a new market: online marketing that can be targeted as precisely as junk mail.

"Will these classifications mean that some consumers will only be shown advertisements for subprime loans while others will see ads for credit cards?" Federal Trade Commission Chairwoman Edith Ramirez said at a press conference. "Will some be routinely shunted to inferior customer service?"

The FTC has called for Congress to pass legislation requiring data brokers to allow consumers to access their information and to opt out of targeted marketing. Currently, many data brokers don't offer people either one.

The Direct Marketing Association, which represents the data broker industry, doesn't offer a specific opt-out for onboarding. It does offer a global opt-out from all of its members' direct mail databases, but it only requires members to remove people's data for three years after they opt-out.

Some companies offer their own opt-outs. Twitter allows users to opt out of onboarding by unchecking the "promoted content" button in their account settings. LiveRamp offers a so-called " permanent opt-out" for users who do not want to be targeted via their e-mail address.

Facebook does not offer a specific opt-out for onboarding. Instead, it suggests users opt out of the data brokers themselves. A Facebook spokesman says that users who don't like specific targeted ads can avoid seeing them again by clicking an 'x' on the top right corner of the ad and following the links to the advertisers' opt-out page.

Want to know more about the market for your data? Read ProPublica's guide to "Everything We Know About What Data Brokers Know About You" and learn how you can opt-out from data brokers.

Courtesy: (


Investing in India: Book Review

India is not the easiest place to get your head around. This book gives a value investor’s guide to investing in India

India has more than 6,000 listed companies, but formal research is available only for some hundred-odd companies. Therefore, the Indian market is rife with mis-pricing which value investors can take advantage of. At the same time, investors need to be careful and not fall into a value trap. A value investor, Rahul Saraogi, managing director at Atyant Capital Advisors, in his book titled Investing in India: A Value Investor’s Guide to the Biggest Untapped Opportunity in the World guides investors through case studies about how Indian companies are run and what investors should look for.

Saraogi explains how the Indian market is awash in amazing investment opportunities. However, he warns investors that they need to have an understanding of India’s history and culture before choosing to invest. Financial analysis should have weightage, but two critical factors that determine whether an investment will do well or not are: corporate governance and capital allocation.

He mentions that there are companies that understand capital allocation and compounding of capital, and there are those that don’t. Then there is a third category of companies which basically run Ponzi schemes. He gives the example of how Sahara operated the largest Ponzi scheme in the country. Therefore, it is important to be aware of such practices.

He explains a five-step framework to evaluate stocks and to separate value stocks. Each stock needs to go through one filter before going through the next. The five filters he explains are: corporate governance, capital allocation, business fundamentals, financial strength and relative opportunity.

When it comes to corporate governance, Saraogi says he looks for companies that treat minority shareholders like equal partners in the business and whether the company is run keeping in mind and safeguarding the interest of minority shareholders. He mentions that there are situations where dominant shareholders use companies like personal piggy banks or they use them to promote their own agendas; they’re not really safeguarding the interests of minority shareholders—unfavourable mergers, preferred dividends, etc. He further mentions that identifying poor corporate governance is subjective and no two investors will agree on what is forgivable and what is not.

The second most important filter is capital allocation. Most companies destroy the earnings that they retain with themselves, over time. After achieving a particular size or social standing, promoters no longer care about maximising returns on capital or growing real wealth. Instead, they get carried away by setting up offices and factories around the country and around the world. They expand the business for the sake of growth, but end up taking on significant debt and risk the long-term well-being of the company and its shareholders. They participate in competitive bids to acquire companies and, often, destroy value in the process. Few companies actually understand how capital grows and how it is compounded.

One such example he gives is of EID Parry, part of the Murugappa group from Chennai. Despite being in various cyclical businesses, he says that the Murugappas have an excellent track record of capital allocation and value creation. The flagship company, EID Parry is primarily into sugar manufacturing but the group has diversified into businesses like fertilisers, confectionery and ceramic bathroom fittings. These businesses have grown, with very little additional capital, to critical sizes; some of them were subsequently sold at attractive prices.

After a company passes through these two important filters—of corporate governance and capital allocation— one can then look at business fundamentals and financial strength. A high cash-generating business that is prudent in its capital allocation makes for a stock that is likely to be a winner. The last filter deals with the constant evaluation of potential stock investment ideas relative to stocks already in one’s portfolio. It is important to diversify one’s portfolio, but over-diversification can result in average returns.

The book gives an overview of the country’s history, government, politics and media practices. The author also delves into the banking system, financial infrastructure and real estate. It is really targeted at foreigners but is also a good refresher for an Indian investor. After all, Indian investors have stayed away from their own stockmarket and thereby missed the incredible value creating opportunity   over the last decade. Even today, they are ignorant about the opportunity ahead.


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