Phorm Success in Brazil
Friday, April 2nd, 2010Phorm, the controversial software company that has been rejected by the UK after much consumer concern, now appears to be doing well in Brazil.
The company was criticised for providing a service that interferes too much with privacy. Their software enables ISP providers to track consumer behaviour which then enables online advertising to be very targeted. Although large companies showed an initial interest, UK backing fell away when the controversy hit the mass media. Even Sir Tim Berners-Lee, one of the internet’s founders, attacked the business for intruding on privacy too much.
Phorm has managed to gain a strong foothold in Brazil with many companies signing up to their service. There is also speculation that they are in talks with the news and entertainment website Terra which is owned by Spain’s Telefonica which does business across South America and the US.
Consumers fear that Phorm may try to enter the UK again via the back door: Telefonica owns the O2 telecoms business. This is highly unlikely. Even if Phorm were to be exonerated in the UK, PR and marketing departments are unlikely to engage with a company that has been so publicly ousted from the UK marketplace.
Tracking online consumer behaviour is a lucrative and effective way to gather data that allows internet marketers to target audiences with products that are honed to their tastes and needs. What consumers are not aware of is that this is happening all the time when they are online. Amazon, for example uses software that suggests products for you based on your previous choices. Google adapts its response to your search queries depending on your previous online behaviour. Facebook advertises to you based on the analysis of what you do and write on their site.
Last August the Office of Fair Trading said they would be investigating online advertising including software that tracks consumer behaviour. It remains to be seen whether the results of this study will have an impact on how UK marketing can go about their business.
