Yahoo was recently accused of intercepting emails sent by its users to create targeted advertisements based on personal information to make profit. Yahoo has more than 275 million customers worldwide,  and according to the lawsuit, ads bring in approximately three quarters of Yahoo’s earnings.

An increasing number of social networks and Internet companies are utilizing customer information, often without their knowledge, to make profit at their customers’ expense. This raises ethical issues about how these companies gather information, as customers are unknowingly giving firms glimpses into their personal lives. This relates to Fraser Denton’s blog post about Tesco’s employment of face scanning surveillance cameras to analyze age and gender of customers in an effort to better customize advertising.

In a highly competitive industry, pressure is placed on companies to deliver a marketing strategy that is individualized to each consumer. However, as focus is placed on the dominant consumer, other potential customers are ignored , which leads to decreased revenues and a negative brand reference. Large amounts of personal data is analyzed, which could be costly, but simultaneously, helps companies reinvent products and prevent futile promotions. It is interesting to see companies trying to integrate advertising into customers’ lifestyles and preferences. The question then becomes, as success rates of personalized ads rise, where will companies draw the line on what aspects of consumers’ lives constitute non ad-worthy material.

Check out the article here!:http://www.businessweek.com/news/2013-11-16/yahoo-sued-in-california-for-allegedly-intercepting-e-mails-1

Image from : http://www.ymailblog.com/blog/2010/09/