National Press Club

Politicians are Buying your Cookie Crumbs to Target You

July 23, 2014 |

Jordan Lieberman, president of CampaignGrid, which sells targeted online political campaign ads, explained how the ads are targeted and sold. He made his presentaton at a Campaign Boot Camp session at the National Press Club July 22.

He described the process that matches information from voter lists with information from cookies -- data placed on users' digital devices by websites they have visited.

Although the cookies reside on users' devices, they are owned by the websites, which can sell or rent them, he said. Individual identifying information is removed before the cookies are sold or rented, he added.

For example, matching cookies containing geographical information with voting files from a district identifies registered Democrats who voted in the last two elections in that district, making it possible to display ads on websites they frequent, he explained.

"The ads follow you wherever you go," he said, because they find your device, laptop, tablet or smartphone on which the cookies reside.

Users could avoid the ads if they erased all their cookies and never buy anything online, he said. Most people choose the convenience of using the Internet over privacy, he noted.

The industry offering this service to candidates now employs 200 to 250 people, he estimated. His own company employed five people in 2010 and now has 40, making it the largest firm in the industry. It has recently received a patent on its process, with implications still to play out, he said.

Lieberman's explained that his firm does not advise campaigns but only helps them reach a targeted audience. Therefore they mostly work as a sub-vendor for other vendors, he said.

"We invest in relationships," with vendors, he explained.

Consequently, reports on expenditures for targeted online ads are not available separately from those covering other media expenditures in most campaign finance reports, he said. California's different reporting requirements make it an exception, he added.

Most campaigns target voting history plus one other variable because combining data sets from multiple sources causes accuracy to drop, he said. Although the firm could offer 14,000 possible characteristics, only a few are actually used, he said.

"We measure success as: did we deliver the impressions to the right people in the right time frame," he said, meaning were the ads were displayed to the target audience at the chosen time in a campaign.

He recommends that clients emphasize number of displays over clicks because clicks vary by the type of campaign, more for a presidential election than for county auditor, he said.

The advantage of online ads is that campaigns only pay for ads that are actually displayed while the user is on a website versus mail or TV ads that may or may not be seen, he argued.

Lieberman's firm charges 2.9 cents per video play and 1.4 cents per impression displayed.

The firm's experience has revealed that "learn more" or "tap here" links lead to more clicks than "click here," he said. Similarly, they have discovered that users are more likely to play a 15-second ad to the end than a 30-second one.

Online targeted ads have not yet been regulated by the federal government, Lieberman said. If it did regulate, he would suggest requiring disclosure of the source of an ad.

The session was presented by the Regional Reporters Association, the National Press Club Journalism Institute and the Institute's Professional Development Committee. Paul Merrion, Washington bureau chief of Crain's Chicago Business, moderated.