"Since information helps markets work better, the cost of privacy is less efficient markets," writes Paul H. Rubin in the Wall Street Journal (8/30/10). That's the first of Paul's ten rebuttals to what he sees as "fallacies" about privacy. His point is that, contrary to what some may believe, our privacy is not free, given "a strong trade-off between privacy and information." Paul also says that the costs of privacy are not "borne by companies" because "consumers get tremendous benefits from the use of information."

He notes, for example, that Google's various free services are "all ultimately funded by targeted advertising based on the use of information." Naturally, Paul also forwards the most common anti-privacy argument -- that when ads are targeted, consumers "get better and more useful information more quickly." He further contends that the quality of those services would decline if Google didn't have the information required to "better target searches," for example. "Shorter retained search histories mean less effective targeting, " he writes.

Refuting the argument that privacy invades our personal space, Paul points out that most information is used anonymously. He says that information-based price discrimination "makes it possible for firms to provide goods and services that would otherwise not be available, "and that less privacy creates greater safety, since information is used to combat identity theft." Opt-in doesn't benefit consumers, says Paul, "since the use of information is generally benign and valuable." And he says consumers should not be irate over how their information is used, "because there is no harm from the way it is used."

"I understand that advertising supports the internet, but I am a little spooked out," says Senator Claire McCaskill in a New York Times piece by Miguel Helft and Tanzina Vega (8/30/10). She adds: "This is creepy." The senator is among several lawmakers considering regulations on "remarketing," or the practice of tracking consumer behavior online to serve up targeted ads. Zappos is among the most enthusiastic proponents of the practice, but it appears that some backlash may be brewing.

If you've ever shopped at Zappos, you may have noticed that items you viewed but didn't purchase show up in ads on sites -- YouTube, Facebook or MySpace -- that you subsequently visit. "It's a pretty clever marketing tool," says Julie Matlin, who found herself being followed around by a pair of shoes she had viewed on Zappos. "But it's a little creepy, especially if you don't know what's going on." Julie was even more chagrined when she found out she was being followed by ads for a dieting service.

Aaron Magness of Zappos says that's why each ad has a link to an explanation for it along with an opt-out option (which few apparently take advantage of). However, Joseph Turow of the Annenberg School says that simply telling people what's going on isn't enough. "When you begin to give people a sense of how this is happening, they don't like it," he says. And Alan Pearlstein of Cross Pixel Media, suggests it's overkill and thinks the approach could be more subtle by featuring general coupons versus specific items, for example. "What is the benefit of freaking customers out?" he says.

A pop-up retail workshop in San Francisco is part of Levi's "Go Forth - Ready To Work" marketing campaign (video), reports Laura Compton in the San Francisco Chronicle (7/4/10). The eight-week event involves outfitting a 3,000 square-foot retail space on Valencia Street into "a fully functional, albeit temporary, print shop filled with heavy equipment, salvaged work tables, type cases, ink and other essentials of an age-old art." (images).

Levi's Workshop San Francisco, as it is known, features various "local writers, artists and creative types," and "will produce a range of printed matter, such as books, posters, and T-Shirts." All proceeds from the sale of goods produced at the store will go to three local non-profit organizations: Women's Building, Southern Exposure and Plaza Adelante. Zach Augustine of Winston, a retail consulting firm, says the Levi's Workshop fills a gap left by budget cuts for arts and education.

"It's almost like you're going to school at some amazing fine art workshop presented in the old-school environment," he says. Mike Maher of Taylor Stitch, a local shirtmaking artisan who is participating in the Workshop, agrees: "The beauty of it is, they're giving people skills, educating them," he says. Other participants include Shepard Fairey, who will produce San Francisco Giants baseball cards, as well as Arline Klatt and Beth Lisick, who will host a release part for a letterpress book. Levi's plans to open a second Workshop in New York City this fall.

Economists assume that people make choices based on relevant information about their choices, but that's absurd, suggests Robert H. Frank in the New York Times (5/30/10). It's true that most people generally respond in a rational way to their options, such as lowering their thermostats when oil prices increase. But behavioral research suggests that "even patently false or irrelevant information often affects choices in significant ways."

For example, in a 1974 experiment, people were asked to spin a roulette wheel rigged to stop at either 10 or 65, and then "asked what percentage of African countries belonged to the United Nations." On average, those whose number stopped at 10 guessed the answer was 25 percent, while those whose number stopped at 65 guessed 45 percent. Both groups knew the roulette number was irrelevant to the U.N. percentage, but the spin of the wheel influenced their answers.

Robert relates this insight to cigarette advertising, noting that such ads "typically portray smokers as young, healthy and attractive" even though smoking makes people "look older and less healthy." The ads "make no explicitly false claims," he notes, "but that doesn't make them less misleading, even for informed consumers." He concedes that this brand of irrelevance can't really be regulated, and suggests the only answer is to make such claims socially unacceptable.

A software program called PlaceLocal is creating display ads for local businesses by aggregating information, endorsements and images from across the web, reports Anne Eisenberg in the New York Times (5/23/10). Developed by an advertising technology company called PaperG, the software scours "the internet for references to a neighborhood restaurant, a grocery store or another local business. Then it combines the photographs it finds with reviews, customer comments and other text" into display ads on local-media websites.

Creating an ad is as simple as entering the enterprise's name and address, and then the program gathers "basics like telephone number, hours of business, maps and directions" while also "adding positive comments from local blogs." This works even for businesses that don't have a website by collecting information from yellow pages listings, for example. For now, local businesses must go through a sales rep to create an ad, but eventually they'll be able to do it themselves. Sales reps say the system not only saves time and money, but also helps them sell more ads.

"Instead of sending customers a rate card, I send them an ad that the program has built," says Shaina Park, a Time Out New York rep. "It's easier to sell ads if customers have an example in front of them." So far, PlaceLocal "is up and running on 32 local-media websites, including Time Out New York and Time Out Chicago" as well as websites for "29 network TV affiliates owned or managed by Heart Television. The McClatchy newspaper chain has also signed up, and will be offering the service soon. Pricing is based on a flat fee, ranging from $150-$500 "based primarily on how often the ad is shown."

The Black Eyed Peas are "among the fastest learners of the music industry's new math," reports John Jurgensen in the Wall Street Journal (4/9/10). It wasn't so very long ago that the Peas were "lending their music for relatively paltry fees in exchange for exposure," making "deals with Best Buy, Apple and the NBA, slingshotting their way into households on multi-million-dollar ad campaigns." Will.i.am, the band's frontman, says his inspiration to blend art and commerce was "My Adidas," a 1986 song by Run-DMC.

"I consider us a brand," he says. "A brand always has stylized decks, from colors to fonts. Here's our demographic. Here's the reach. Here's the potential. Here's how the consumer will benefit from the collaboration." The Peas have certainly benefitted from the collaboration, having "been escorted by a parade of corporate backers" to a point where they "are poised to be one of music's top earners this year." It's a path that began back in 2001, when the Peas recorded a jingle for Dr Pepper (video).

It took off like a shot in 2003 when their song, "Hey Mama" was used by Apple to launch iTunes. This helped the Peas get radio airplay for the song "after telephone surveys demonstrated to radio broadcasters that listeners were already familiar with the song from television." These days, the Peas manage to work BlackBerry into their stage act by freestyling text messages sent by audience members and projected via "two huge screens on the stage." Will.i.am has this to say to those who say the Peas are just corporate shills: "I get the credit from the brands. They know."

"Grey was a symbol of what advertising used to be: very slow and not very nimble," says Tor Myhren, Grey Advertising's chief creative officer in a New York Times piece by Jonathan Vatner (2/10/10). It's a rather stark admission, made possible by Grey's recent move from 777 Third Avenue, which it had occupied for 45 years, to 200 Madison, the International Toy Center building. With this move, Grey left behind its traditional walled offices in favor of an open plan. Grey is hardly the first to make such a move, but for the agency, it's a big shift.

"We've created a faster environment, one that is more open and collaborative," says Tor. "This space reflects what's happening in the digital world." Designed by Studios Architecture, the new space provides "ad hoc collaborative spaces" with "long butcherblock tables." Elsewhere, there are standalone desks separated only by "low cubicle walls." As Alex Lubar, the agency's new business vice-president notes, "No more affairs and siestas. Or at least if you're going to do them you have to be more theatrical about it."

Grey spent a year prepping its people for this change, and has a psychologist, Dr. Joel Mausner, on hand to help everyone adjust. Joel plans to help employees mourn the old space, deal with any drawbacks, and "use the new space to its full potential." He says workers need "to reach a collective understanding of how they're going to behave differently." For Natalia Schultz, the agency's chief talent officer, the adjustment includes finding a place for her shoewear collection. At the old office, she had a closet, but now she keeps her shoes in the trunk of her car. She also notes a new house rule: "Tuna should never be consumed in the open plan," she says.

It took Canesta eleven years to create technology that can replace your remote control with your hand, reports Ashlee Vance in the New York Times (1/12/10). The key was in the development of 3-D cameras that add a "crucial layer of depth perception that helps a computer or TV recognize when someone tilts their hand forward or nods their head." At first, these cameras were as big as a desktop computer, but now Canesta has got the technology down to a chip about the size of a fingernail.

"We always had this grand vision of being able to control electronic devices from a distance," says Canesta's Cyrus Bamji. The vision is now reality: "Stand in front of a TV armed with a gesture-technology camera, and you can turn on the set with a soft punch into the air. Flipping through channels requires a twist of the hand, and raising the volume occurs with an upward pat. If there is a photo on the screen, you can enlarge it by holding your hands in the air and spreading them far apart and shrink it by bringing your hands back together..."

The result is "one of the most significant changes to human-device interfaces since the mouse appeared next to computers in the early 1980s." Hitachi is planning to introduce TVs equipped with the technology later this year, and Microsoft plans to employ it in a new videogame system, dubbed Project Natal. "Laptops and other computers should also arrive later this year with built-in cameras that can pick up similar gestures," rendering "today's touch-screen tools obsolete." And making it "impossible, try as you might, to lose your remote control."

Wild Bill's Nostalgia Center is celebrating its 25th anniversary, which is quite something considering it's a store that "doesn't sell anything anyone really needs," reports Hannah Vahl in the Middletown Press (12/14/09). The store actually had a different name -- Apple Core -- when Wild Bill Ziegler founded it as a gift shop on Main Street in Middletown, Connecticut. Since then, it's had several other names -- "Buffalo Bill's, the Beetles Store, the 60s store." But what hasn't changed is the insanely eclectic merchandising mix.

It's a mix determined primarily by happenstance (virtual tour here). Wild Bill "acquires much of his goods by getting out-of-the-blue calls about a large load of items, such as 8,000 sport jackets, 50,000 3D glasses, 75,000 posters and 10,000 picture frames ... Once a man driving by said he had a truckload of whale bones and whaling tools he had inherited from his grandfather." Wild Bill bought it all, and "managed to sell bones to Wesleyan University and Trinity College in Hartford, though a whale rib still hangs suspended from the ceiling of his store."

The whale rib is really nothing compared with what Wild Bill has got going on the store's facade. In addition to a mural of various pop-culture icons, there's a huge bobbing head featuring Wild Bill's likeness above the door. The mural got Wild Bill into trouble with the town, but he eventually prevailed, arguing that the mural was art, not advertising. "The town gave us a half million dollars of free advertising by fighting us, "he says. To celebrate his 25th, Wild Bill commissioned a sculpture "made of 1,000 animal traps and other metal objects" (image). It's yours for $500,000.

Television is alive and well for advertisers who innovate and collaborate. By Cindy Jolicoeur. (more)