Media Tech Business

Attention, watchdogs. You are sniffing up the wrong butt!

Mark Rogers Photography on dogster.com

Consumer watchdogs, privacy advocates and others who prefer government regulation to industry self-regulation of data collection, cookie tracking and behavioral targeting put entirely too much faith in government.

Ironically, they’re even more wrong about how well any of this actually works in practice today on the web.

As an industry insider, I do all that I can within the bounds of safe computing to optimize my computer to allow cookie-setters, data gatherers and targeters to show me what they can do. Most often, the results are only fair or poor. On rare occasions, a truly relevant message appears that surprises and delights me and, more important, offers me something I’m actually interested in at that moment.

If it’s usually difficult for me to see the effects – good or bad – from the use of my data for commercial purposes, how is it possible that people with no inside knowledge are dead certain that malevolent forces are out to destroy our privacy via online targeting?

1. It’s not easy to be targeted.
Every browser, anti-virus and pc optimizer program, among other widely-used applications, makes it increasingly difficult specifically to allow your machine to be targeted. This simple example comes from a routine scan (AVG, free version) of a machine which has been set and reset numerous times to ignore every one of these widely known, safe sources of ad deliveries and/or audience analytics. A typical consumer would take the virus warnings seriously and would promptly remove and prohibit such common cookies, which help make browsing more convenient and relevant.

 2. On the internet, nobody knows you’re a dog.
The New Yorker cartoon by Peter Steiner generally is still true 12 years later. Sure it’s possible for hackers, law enforcement and others to piece together a story from your many web activities. Since you purposely leave your life’s details all over social networks, it hardly requires a visit from the internet czar to figure out what you’re up to. You can still choose not to reveal anything about yourself online by, well, refraining from using the web, email, IM, etc. Then only your supermarket, credit card issuers, banks, department stores and cataloguers, U.S. Postal Service and many, many others will know all your details. Just unplug your computer and you’re safe at last.

Do you worry that we’re only a step away from Orwell’s omniscient telescreen? I choose to obey the law and not worry. I’d rather enjoy the benefits of the web, including legitimate commercial uses by companies that are guided by respectful consumer-friendly principles and profit-driven innovation.

3. Behavior – online or off – can be misleading. After reading “Find Me Again: A Blizzard of Retargeting,” I visited several sections of the Skechers site, beginning with the women’s shoes section, likely to be the most valuable and heavily-tagged and trafficked part of the site for research purposes. Next step was to go to my Yahoo! Mail account and, sure enough, the parade of Skechers ads – all targeting women – began appearing. Six weeks later, I still see them all the time.

One visit to the women’s shoes department and they retarget me to death. I assume they can do this because they pay only for specific actions generated from ads on inexpensive and plentiful exchange and network inventory.

To the company’s credit, Skechers has been very open about their marketing efforts. In addition to the Behavioral Insider article, there are Skechers case studies from AudienceScience and MyBuys, among others, and open discussion at conferences. If the privacy fearmongers would read some of these, they might be further inflamed by the casual references to targeting consumers. Or they may get the idea that this practice is  widespread, innocuous (even if some find it annoying) and, at its best, it results in a satisfying experience for the consumer and the advertiser. If they were to read further, they might even come to understand that this popular and simple form of retargeting is not particularly accurate or effective.

My first Skechers ad on Yahoo! arrived courtesy of Blue Lithium, but it might easily have been associated with other sources identified on the Skechers site on July 1, 2009, including Acerno, AudienceScience, Burst, Fastclick, Fetchback, Interclick, Trafficmp, Tribal Fusion.

4.  Will the big dog hunt?

On the web, Google is like the world’s tallest dog, Gibson, measuring more than seven feet tall standing up. He appears to be friendly, but you can imagine how fearsome a presence this towering Great Dane makes, and how he must garner equal measures of respect and terror even among dog lovers.

Google introduced its flavor of interest-based targeting several months ago, so I promptly signed up for over a dozen different categories of business and consumer interests. Ho-hum … I have noticed exactly ONE ad that may have been a result of this program.

Interest-based targeting on Google: not interesting

If the big dog keeps up this performance, you watchdogs can move on to a new fire hydrant in someone else’s industry.

Tags: Ad Blockers, Ad Inventory, Ad Networks, Ad Serving, Audience Targeting, Behavioral Targeting, Data, Media Exchange, Search, Shopping data by Bennett Zucker
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Revenue Science CEO Bill Gossman, speaking on a vendors panel at today’s OMMA Behavioral Conference in New York, told the crowd, “I believe that we coined the term ‘behavioral targeting.’” Well, Bill, if you believe that, then undoubtedly you give Al Gore credit for the internet, as well.

In fairness, I suspect he might have been referring to the fact that Revenue Science started talking about “BT” not long after digiMine became RSI in 2003. TACODA was selling behavioral targeting – with all syllables – for more than two years at that point, and of course Engage, Yahoo! and others were doing it in the pre-bubble 90′s. So, we’ll cut you some slack, Bill, but you must admit it was a pretty goofy claim!

Tags: Behavioral Targeting by Bennett Zucker
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If you want to know where behavioral targeting is going, look at aCerno. After consulting with Tom Sperry, Dave Hinton and team last fall, I signed on as VP of Sales & Marketing to help bring the company’s exciting story to market. You’ll be hearing a lot about us soon. For now, a snapshot:

- the only predictive targeting ad network

- the only online data co-op, with more than 350 member brand and multi-channel retailer sites

- anonymous shopping and purchase profiles of more than 125-million US consumers

- use predictive analytics & real-time ad decisioning at scale to accurately describe who is in an audience and what they’re likely to buy next.

I’ve written previously about the many opportunities available in the marketplace to help advance behavioral targeting, and I’ve been up close and personal with several of them. There’s also a summary today in Adweek. I chose aCerno because it represents the best combination of great data (responsibly managed, I might add), people, real-time targeting and results, results, results – for both brand-building and direct response.

Stay tuned …

Tags: Ad Networks, Audience Targeting, Behavioral Targeting, Data, Shopping data by Bennett Zucker
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Very cool to see friend and former boss (at TACODA and earlier at Real Media) Dave Morgan take on global advertising strategy at AOL. Nice interview with Rafat Ali here shows why one of the web’s great storytellers is the right guy for the job.

Following the earlier appointment of TACODA CEO Curt Viebranz to President of AOL’s Platform A, the portfolio encompasses Advertising.com, Adtech, Lightningcast, TACODA, Third Screen Media and soon to be added Quigo.

AOL appears to be stitching together a smarter plan than Yahoo!, which is back-pedaling into becoming a technology company again, rather than zooming ahead into a networked future. As one of the true global media powerhouses, TimeWarner has more to lose by becoming less reliant on its own content than does Yahoo!, which has de-emphasized media and re-upped the ante on technology.

The best news for TW and AOL is that the content is always there for them to use to attract and retain great audiences. And it’s also there for them to make money from Google and MSN and former almost-media company Yahoo!, all of which depend on the TW’s of the world to feed content to their hundreds of millions of hungry users.

As perennial underdog to Google, Yahoo! and MSN, AOL also has more to gain by being bold. Ditching the ISP business, continuous reorganizing, massive layoffs and other wrenching changes are necessary for the company to compete again. They’re moving on all fronts, but the steady drumbeat of acquisitions and appointments is the clearest sign that AOL intends to win the fight to become solid number 2 behind Google.

Yahoo! is also banking on maintaining and growing its global audience leadership through platform and network acquisitions, but ultimately they’re hellbent on doing everything the Y! way.

This concerns me as a Yahoo! shareholder (from its acquisition of Right Media in July), but more so as a Yahoo! loyalist whose browser home page has been set to my.yahoo.com since 1996.

Yahoo! can’t grow its audience by building a better mousetrap: It’s the cheese that lures users. Please, Jerry, give us more and different and better varieties of cheese, not a stronger, faster spring or better distribution around the kitchen!

Hearty congratulations and good luck to Dave and Curt and the gang at TACODA. And an equally hearty HURRY UP! to the Yahoo! crew.

Tags: Ad Networks, Ad Sales, Behavioral Targeting, Digital Economy by Bennett Zucker
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… and he is us. (Walt Kelly, Pogo)

For years I’ve enjoyed asking a couple of simple questions when speaking to online advertising, marketing and media groups:

- “How many of you delete your cookies?”

- “How many of you use ad blockers?”

Try it the next time you’re in front of a roomful of advertising and media professionals. I’ll bet you will find that at least a third, and often more than half, of the audience will raise their hands. They are the professionals, and they don’t get it.

They think that internet advertising is an invasion of privacy, an unwanted distraction, and a downright unAmerican practice. If people in the business don’t understand, how can we expect ordinary web users to welcome cookies, targeting and advertising generally?

Lots of people in the online business tend to be self-absorbed and smug about how they have changed the world. Well, they’ve done a poor job of educating themselves and the people around them who have made them successful.

How about a web-wide blackout? Every website would replace its contents with a blank screen for a few minutes at a peak time of day. And here’s the message they’d put on the screen instead:

This is your internet without advertising.

Please disable your ad blocker, enable your cookies and enjoy the great free content.

Tags: Ad Blockers, Behavioral Targeting, Data, Digital Economy, Digital Publishing by Bennett Zucker
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Greg Smith tells me EchoTarget now offers lifestage targeting thanks to new parent, Acxiom, which enables targeting and creative optimization based on income, net worth, age, presence of children in household, and other datapoints of importance to financial services marketers.

And Greg Stuart wrote to remind us that his top secret projectRialto is moving stealthily along. Thanks to the Gregs and other correspondents!

Tags: Behavioral Targeting by Bennett Zucker
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By next March, a dozen companies you’ve never heard of will launch notable products, ad networks, or services based on behavioral targeting. Some are newborn; others are already making money, but still flying low. They come in lots of new flavors:

1. Targeting with ISP data. Competitors include Adzilla and Nebuad, which have raised $10.25MM and $30MM recently, and Phorm. They all work with ISP subscribers’ data to target more relevant content and ads. Other companies with strong ISP relationships will enter this market, as will a venture that includes ISPs as founding partners.

2. Data exchanges. As one founder described it to me, “it’s a little Tacoda and a little Right Media. It can’t miss!” The theory is that sites will gladly sell user data rather than continue to give it away to ad servers, networks and research companies. At least two raw startups and two veterans are racing to produce the first commercial-grade data exchange, where advertisers can bid on audience by behavioral segment. They split the ad market, with two of them being all about performance and two going for brands.

3. Purchase behavior. Tom Hespos wrote recently that purchase behavior may be the new behavioral “thumbprint.” And he’s right: One company documents a conversion rate increase of 790%. The aCerno Transaction Marketplace is an online data co-op whose 300+ customers can target their own and each other’s customers all over the web.

4. Exotic behavior? Agent-based modeling is the secret science that will propel one startup’s better targeting engine. The goal is to super-size valuable segments comprising enormous populations of target-lookalikes.

5. Beyond behavior. Mindset Media offers brand marketers the chance to tailor their messages according to twenty elements of personality, such as “Humility” and “Bravado,” “Creativity” and “Compliance,” each of which has up to five distinct “mindsets” that can be targeted at scale. Tasty.

More flavors and details to come.

Tags: Ad Networks, Behavioral Targeting, Data, Digital Economy by Bennett Zucker
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… ask what media can do for tech. So might JFK have put it were he inspiring legions of media publishers, rather than U.S. citizens, to step up and be counted on to make a difference.

How well do revenue-enhancing media technologies really perform for publishers? Henry Blodget takes a good stab at how much Tacoda might contribute to AOL’s network revenues. Like most industry observers, he misses some basic assumptions that result in overestimating the impact, at least near term.

When any ad network claims to reach X percent of web visitors, they’re typically describing potential reach, not the actual number of visitors to whom the network served an ad in the previous month.

Example: Network Z serves ads to Sites A, B and C, which have monthly unique visitors of 2, 4 and 8 million, or 14 million combined. After removing duplicates (N visitors to A also visit B, N+X visitors to A also visit B AND C, etc.), say we have an unduplicated total of 7 million visitors to all three sites, or 50% of the duplicated total. The network may claim a potential unduplicated reach of 7 million.

But on a typical site, 20 percent of visitors generate 80 percent of traffic. So Site A, with 2 million uniques, has fewer than a half-million visitors per month who generate most pages and ad impressions. These same heavy users consume the lion’s share of ads delivered by Network Z to the unduplicated total.

Back to Blodget. First, he is correct about how Tacoda, Blue Lithium, Valueclick and others take non-premium inventory that yields well under a dollar and then use audience targeting to convert some of this into inventory yielding around $3.

In his AOL calculation, he assumes that “25% of display inventory and 50% network inventory can be ‘enhanced’ and that the ‘enhancement’ might range from 50% to 150%.”

This is a well-considered discounting of how much enhanced targeting can do for a vast amount of inventory, but it doesn’t go far enough. Since most of AOL’s volume is in email, IM, and other hard to target inventory, the amount that needs enhancement is probably closer to 90% than 50%.

Most ad impressions are generated by a small group of heavy users. If frequency caps are in effect, and if heavy users don’t do a lot of web surfing on other sites in the behavioral network, then Tacoda will have the same trouble monetizing most of this traffic that AOL has today. Therefore, my guess is that increasing AOL’s run rate by $200 million (the bottom of Blodget’s 10% to 40% enhancement estimate) will take years and many new tricks.

Tags: Ad Inventory, Behavioral Targeting by Bennett Zucker
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