Behavioral Targeting Revisited

After years of being under-utilized, if not completely ignored, behavioral targeting has re-emerged as an attractive technology in the online advertising marketplace. In light of this renewed interest in behavioral targeting, now is a good time to reconsider the technology’s strengths as a marketing strategy and discuss how advertisers and agencies can capitalize on them. Think of it as a refresher on behavioral targeting. Let’s examine what behavioral targeting actually is, the reasons for its slow penetration and the factors precipitating its resurgence.

Behavioral targeting is simply a way that parties on the demand (e.g. advertisers, agencies, technology vendors, etc.) and supply (e.g. ad exchanges, ad networks, publishers, etc.) sides of the online media business can harness data about users’ online behaviors to increase the value of online inventory as marketing media. The behaviors that companies involved in behavioral targeting track generally include browsing Web sites in specific content categories, visiting an advertisers’ Web site, completing or abandoning an online transaction or entering specific keywords into a search engine but can potentially encompass any and everything a user can do online. Typically the data is collected via publisher or third-party cookies.

In the early days, behavioral targeting vendors – such as Audience Science (formerly Revenue Science) and Tacoda (now part of AOL’s Platform-A) – struggled with a number of obstacles as they attempted to sell their solutions. The major obstacle was scalability. Behavioral targeting vendors are basically ad networks comprised of non-guaranteed or remnant inventory across a set of publishers. This means that desired behavioral segments are frequently small, often too small to meet the particular advertisers’ reach goals. As a result, most advertisers have used premium inventory to meet their reach goals and publishers’ user demographics as a proxy identifiers for their target audience. Other challenges included user privacy and brand integrity (advertisers often had no control or knowledge regarding the content adjacent to which their ads were being placed).

However, despite the challenges, several factors have arisen that are making behavioral targeting a hot topic once again. The most important of these factors are the saturation in premium display inventory and the increasing fragmentation in the online media environment. Premium display has reached a saturation point in terms of supply while increasing media fragmentation and competition with offline channels has placed definitive limits on the price publishers can charge for premium placements. This development has shifted the focus on the supply and demand sides of the online media business to non-premium display inventory. However, non-premium display buying raises the issue of identifying the audience target since publishers can no longer be used as proxies, at least not at scale. This is where behavioral targeting enters the picture. In addition, the launches of behavioral data exchanges (e.g. BlueKai and eXelate) as well as meta ad networks (e.g. MediaMath, [x+1], Varick Media Management) have made behavioral targeting more scalable as user data is now available across networks and networks themselves are now customizable around specific behavioral targets. Meanwhile advocacy groups have been working with major industry players to introduce legislation that would provide opt-out mechanisms for consumers averse to the idea of being tracked online.

Now that behavioral targeting has returned to the spotlight, let’s turn to how advertisers should use the technology for best results.

Branding campaigns
Most often, marketers think of behavioral targeting as a way of finding consumers that are currently in market for a particular product or service. In other words, the most common view of behavioral targeting is basically a sexier, more interactive search marketing strategy. To use a conventional marketing metaphor, marketers frequently think of behavioral targeting as a “bottom of the funnel” strategy. However, consumers engage in many activities online that can define them as people who would be susceptible to specific brand marketing messages; especially messages that come into play at the “top of the funnel”. For example the Web sites people visit, the search keywords they use and the other actions they take online do not only indicate what they are looking to buy but also what kind of person they are and the brand messages to which they’d be most receptive. Effectively harnessing data about users’ online behaviors to deliver relevant brand messages has proven successful in many branding campaigns over the years.
For example, Sony Ericsson used Eyeblaster’s Déjà vu targeting to deliver personalized ads to individual users based on their physical location as well as data from multiple digital channels including site-side, email Behavioral Targetingand display ads that included desktop communication applications. The re-targeted ads offset the decline of clicks week-on-week, which highlighted the power of behavioral targeting in overcoming typical creative burn-out. In addition, as a result of the enhanced relevancy of the ads that behavioral targeting enables, the ads themselves became viral as users frequently shared the ads with their friends. The Sony Ericsson campaign serves as a compelling testament to the branding impact of behavioral targeting. Click here to see the full case study.

Direct response campaigns
Behavioral targeting is already widely accepted as one of the most effective online direct marketing strategies. Actually, search engine marketing, the most successful online marketing strategy to date, is a variety of behavioral targeting. While clearly being most effective in categories that involve high consideration purchases such as automotive and travel, in which users leave behind a long trail of bread crumbs that demonstrate that they are actually looking to buy, behavioral targeting has been successfully deployed as a direct response strategy in nearly every category. In several campaigns, behavioral targeting has proven to be the best way to locate high value customers with fewer impressions. One way to harness the unique power of behavioral targeting in direct response campaigns is to use rich media creatives that allow users to initiate purchases from inside the banner.

In light of the new developments in the field, behavioral targeting is once again earning the serious consideration of all online marketers. If you have had any success with the technology, especially in the case of branding campaigns, please share your insights.

By Sean Gelles

Source: Creativezone

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