The campaign was developed through a collaboration between BNZ, TVNZ and ad agency Colenso BBDO.
The digital ads were an extension of BNZ's "Bank of New Zealanders" ad campaign.
The ASA's decision was made last December but sent out on a recent summary of rulings.
BNZ explained that it supplied the advertisement to TVNZ with a blank space in place of the generic name usually used. TVNZ then applied the first name of the user in that space using their TVNZ OnDemand account details.
"BNZ takes the protection of personal information and data security very seriously, for customers and non-customers alike," the bank said.
"BNZ ensured that the process of TVNZ applying each user's name to the advertisement did not involve the sharing of any personal information between BNZ and TVNZ. Specifically, TVNZ did not share any users' names, or the content watched by any particular user, with BNZ."
TVNZ acknowledged the concerns raised and decided to remove the personalised ads, pending a review of its privacy policy.
TVNZ said it collects the personal details of viewers when they register for the OnDemand service and that this information is sometimes used to make ads more personalised.
"Viewers accept this privacy policy when they register an account with TVNZ OnDemand," TVNZ said.
"The name used within the Advertisement is intended to refer directly to the person watching the Advertisement."
While a relatively new approach to advertising, the ASA complaints board compared it to direct mail advertising, which often employs the name of the recipient in a letter.
The complaints board did, however, express concern that consumers were confused as to where BNZ sourced the information from.
The board said that TVNZ's privacy policy in place at the time did not go far enough to signal to users' personal information would be used in that way, and that this aspect of the advertisement was socially irresponsible.
Given TVNZ's willingness to remove the ad and review its privacy policy, the ASA ruled that the matter was settled.
BNZ told the Herald today that it paused the campaign while it was investigated by the ASA.
It did not go back on air after the ASA decision because the overall campaign was finished.
BNZ said it was the first company to use this advertising technology in New Zealand.
"We received a lot of positive feedback from customers and a media award for innovation," the bank said.
Creepy or relevant?
Online targeted ads have faced significant criticism at a time when consumers are becoming more concerned about protecting their data from tech companies.
Although targeted ads have long been peddled as being more useful and relevant, consumers often view them as creepy.
Accenture research released earlier this year found that 35 per cent of consumers find it creepy when served an ad on a social site for something they had searched for on a brand website.
The only categories of targeting viewed as creepier were receiving a text (41 per cent) or mobile notification (40 per cent) from a brand retailer when walking past a store.
In an essay published on Medium, advertising thinker Faris Yakob is highly critical of personalised online advertising, blaming it for an increase in ad-blocking.
"It's the "creepy Minority Report" style ads that drive ad blocking: Personalised targeting that is obvious and visible to users, especially retargeting," Yakob writes.
"Retargeting uses your web browsing habits to personalise the ads that you see, and people hate it in principle — and even more so when they understand how it is done."
Yakob argues users don't even realise what they've consented to, which in turn makes them feel uncomfortable when they see eerily relevant ads.
"It was not the advent of online advertising the triggered the rise in ad-blocking, but the rise of invasive personalised targeting."
