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Illustration by Jim Atherton for the Fort Worth Star-Telegram.
Illustration by Jim Atherton for the Fort Worth Star-Telegram.

Technology

The end of online privacy Add to ...

Generation5 has built exhaustive consumer profiles based on postal codes across Canada - mini-slices of communities whose residents tend to have certain traits.

It builds those profiles from data it collects from credit bureaus, Statistics Canada, media-rating agency BBM and others.

Businesses that buy its research also sometimes contribute to it: Retail stores have handed over purchasing information from their own loyalty programs or those times a cashier asks for a customer's postal code at checkout.

"People will give their postal code where they won't give their name, their telephone number, their address," says Chris Matys, chief analytics officer for the company.

Using its data, Generation5 can build a rough profile that includes probable demographics such as age range, education level and income, but also credit information, past purchase behaviour, media-consumption habits and preferences, as well as attitudes about everything from politics to technology: "All of which, when combined, create a very granular individual profile," says Generation5's director of client management, Jim Green.

For example, say you live in the trendy Westboro neighbourhood of Ottawa.

Depending on your exact address, there is a good chance you'll fall into the Young Homebodies category of Canadian consumers.

Your household income probably falls between $60,000 and $100,000 a year; you're probably unmarried, between 20 and 39 years of age and university- or college-educated; you probably rent your place, in a low-rise building or townhouse; you know about style but shop with thrift; you go camping.

If you live in the Yonge-Eglinton area of Toronto, on the other hand, depending on your exact address, there's a good chance you'll fall into the Mature & Prosperous category of Canadian consumers.

There is a 23-per-cent chance you're Jewish; your household income probably falls between $100,000 and $150,000 a year; you're married with children in elementary or high school; probably between 45 and 64 years of age; university-educated; you read the business section of the paper; and your spouse is an avid gardener.

"We're not working with any individual consumer information," Mr. Green says. "In fact, we don't want it." Instead, Generation5 says it focuses on balancing anonymity with consumer targeting.

In a way, it can be wise for businesses to know more about their customers, meaning less hassle for the rest of us: Why should you be harassed with flashing Web ads for poker sites if you never gamble?

If you're headed out to a movie at the last minute and haven't done much searching, a smart advertiser could suggest a more convenient show time at a theatre closer to you. If you've been coveting a couch that is out of your entry-level-salary price range, you would probably appreciate being told when it's on sale, or where to find a similar style at half the price.

To serve you these perks, an advertiser wouldn't have to know anything that could identify you personally.

"The winning approach is getting the right balance between knowing your consumer and respecting their privacy," Mr. Matys says.

COOKIE MONSTERS

But privacy is relative: When all these attributes connect with tracking technologies, supposedly anonymous information starts to look much more personal. And with the ability to narrow down a person's approximate location based on his IP address, companies may not need you to type in your postal code.

In a single visit, a website with enough aggregated data could know a whole lot about you before you have told them a thing.

If a user enables the use of "cookies" - little pieces of code that live on a person's computer, tracking the number of times they return to a particular site - it becomes even easier to unveil his or her identity.

For websites whose entire business model revolves around online ads, the ability to better reach consumers is increasingly what drives profits.

For example, in addition to posting classified job ads, Workopolis.com uses an ad-serving technology called Helios to track user behaviour on its website, helping its employer-advertisers target their messages better. Through its partnership with online advertising network Olive Media, owned by Torstar Corp. (which also owns 50 per cent of Workopolis), it follows users and shows them ads elsewhere on the Web.

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