Admonsters Behavioural

BEHAVIOURAL TARGETING

A deep dive

Our definition…

An online advertising technology that analyzes

a consumer’s past actions to determine the real-time placement of an advertising creative

A quick aside…

Internet

It’s a REAL place

iCrossing Network Map

10 Years of Behavioral Targeting

1999

2003

2005

2006

2008

Behavioral Targeting launched in the US; Yahoo and Engage are the main players

On-Site Behavioral Targeting solutions for publishers are introduced

Failed to move forward due to privacy, data ownership issues and tech limitations

Behavioral Targeting appears as a standard part of media plan

Publishers embrace as audience extension opportunities, but sales force & agencies slow to transition

Networks are able to support brand advertising

Demand for more scale

Multiple companies claiming they offer Behavioral Targeting

Behaviorally Targeted Ad networks were born

MASS CONFUSION!

EVENT IMPLICATION

Audience Science

Key concepts…• Audience segments• User Interest• Recency• Frequency• Purchasing Behavior• Offline behavior

Segments

• How you ‘slice and dice’ your users• Definitions derived by advertisers, your sales

team, and you• These are the “DNA” of Behavioral Targeting• How do you describe the particular audience

you’re after• E.g.: People interested in purchasing a boat.

• These are the KEY to making BT work– Created by publisher

• Which sites and what key-value pairings• How many visits/clicks qualify you• Recency of activity

– Combined with other targeting• Time of day, Declared, Frequency Capping, etc.

– Advertisers may (and will) ask for bespoke segments.

• Example: KW-TREE_HUGGERS-EXXON

Behavioral Segments

Boat Purchasers

• How do you determine it?– Keyword searches: Brand names; Common

phrases; etc.– Sites visited– Recency– Content interacted with– Income– Location– Past purchases

• All of these can be or could be used…

Smart Segmenting – Top Tips• Standard Segments

– What areas are most inventory constrained/sell out quickly– What sections do you not have, but can build on such as

environment/lifestyle– Which audience clusters are highly demanded such as ABC1, High earners,

etc– Specific work place audiences, especially for non B2B sites

• Bespoke Segments– Are highly valuable and client specific, normally built in response to

agency briefs– Provide ability to reach audience segments based on very niche behaviors

(targeting a specific movie launch/concert event)– Combining a number key elements from the standard segments

• Layering Solutions– Combine multiple rules to expand the size of the audience, while keeping

the audience segment relevant – Finding the optimum balance between reach and relevance

Other Key Targeting Terms

• Declared & Inferred– Inferred

• IP/Geo Targeting (Digital Envoy/Akamai)– Physical Location (DMA/Zip)– SIC/Company Type– Work/Home/School

• Time of Day

– Declared• Age/Sex/Occupation/etc.Why don’t these meet our definition of

behavioral targeting?

Other Key BT Terms

• Re-targeting– Search/Keywords– Clickers on Ad Creative– Clickers on Site Content– Views of Site Content

• Predictive– Uses offline surveys and data

• Purchase Intent

Sample BT Campaigns

A Direct Campaign

• Car Loan– People who have visited car

review sites– In the last 14 days– At least twice– Who are prone to online

purchasing

A Brand Campaign

• Ford F150 Truck– Men who visit sports or

“lads” sites– In the last 42 days– At least 5 times– Who make more than $50k

We’re targeting the USER not the

CHANNEL for the first time!

SO WHAT?

The “Funnel”

Users, people browsing

Consumers looking for a purchase, researching

Ready to buy

Purchasing

People who may be interested in your product

Traditional Media Planning

The “Funnel”

Users, people browsing

Consumers looking for a purchase, researching

Ready to buy

Purchasing

People who may be interested in your product

With BT

BT Growth

Why marketers are exciteda case in point

Assume:Item Costs $20.00 on client’s siteAcquisition (post-click) rate is 5%

Scenario 1: A Traditional Buy10M Untargeted Impressions @ $0.50 CPM ($5,000)CTR of %0.1 10,000 Clicks500 purchases$10,000 in Sales or a 100% ROI

Scenario 2: A Targeted Buy5M Targeted Impressions @ $1.50 CPM ($7,500)CTR of %1.5 75,000 Clicks3,750 purchases$67,500 in Sales or an 800% ROI

Growth of BT v. Display

2005 2006 2007 2008 2009 2010 20110%

10%

20%

30%

40%

50%

60%

70%

80%

Chart Title

Online Ad GrowthBT GrowthAxis Title

?

$3.8 BILLION in 2011

Vendor Landscape

A Crowded Field…

With some consolidation…

Each company has also developed in-house BT solutions over the years…

‘BT’ IN PRACTICELooking Under the Hood

A publisher use case

You can increase yield on areas of site that are not in such high demand or have

heaps of inventory

CPM

Reach

A very simple graph…

CPM

Reach

A very positive result…

Relatively small inventory, high CPM & sell through

$4.00 CPM

Lots of inventory, low CPM and sell through

$1.00 CPM

Lots of inventory, low CPM and sell through

$2.50 CPM

Two Big Wins1. Create “demand smoothing”

across properties

2. Begin to raise CPM on traditionally undersold areas

An agency use case

• Mine the Gold, not the Ore– Old School: Media planner says “Where do I buy

to get High earning males 18 – 34 in major urban areas”

– Channels

An agency use case

• Mine the Gold, not the Ore– New School: Media planner says “I want to buy

high earning males 18 – 34 in major urban areas”– Buying PEOPLE* not channels

*Browsers

Other practical uses

• Why is BT so hot right now?– Growth of user generated pages– Leveraging ad networks– Reaching toward the promise– The “long tail”– Speak the language of planners

How it works

How it works

How it worksUser visits a site

Site A

(finance)

Site B

(e-mail)

How it works• JavaScript on Site

– ...DM_addToLoc("Site",escape("Telegraph")); DM_addToLoc("Level1",escape("money")); DM_addToLoc("Level2",escape("city_news")); DM_addToLoc("Level3",escape("industry_sectors”…

• Cookie On user (UserID)– E06560_10189

Site creates a userID & cookie

Vendor creates a “segment” cookie


Site A

(finance)

Site B

(e-mail)

Cookie created and user ID created from site A


Site A

(finance)

Site B

(e-mail)


Site A

(finance)

Site B

(e-mail)

Finance ad served…

In fact, it’s not the technology that’s complex, it’s managing

it!

BEST PRACTICESAd Operations

Key Challenges

• Inventory Management• Maintaining & Managing Segments• Integration with existing platforms

BT Champion

(Ultimate) Behavioral Champion

Sales Team BT Vendor(s)

Ops TeamAd Server

Vendor

Creating Segments

• Examine high-sell through inventory on site– Create segments based on these sections

• Audience segments you have that don’t directly tie to any specific site content– Golf fans or Environment

• Psychographic Sections– “Silver Surfers”– High Earners– Recent Grads

Creating Segments

• Use bespoke segmentations carefully• Never create a NEW segment when an existing

one will do (clutter, confusion)• Devise and evangelize CLEAR and CONSISTENT

naming conventions– KW-SILVER_SURFERS_J&J– Not “johnson and johnson Q2 old campaign with

search”• Regularly scrub your segments!

Managing Segments1. Use an existing segment instead of creating

duplicates when possible

2. Name segments so they are easy to find

3. Run periodic reports showing segments that haven’t been targeted within a given time frame (e.g. 6 months)

4. Set standards for how big a segment should be before it makes the list of standard segments

5. Set a threshold and force attrition when reached

A Note on Segments…As it is up to each publisher to

create their own segment definitions they will vary site

to site…

This could cause issues for agency planners and

advertisers down the road

Inventory Forecasting

>

Inventory Forecasting

• Ensure you use wide enough segments– The narrower the segment the more volatile your

predictions• Give bespoke segments time to “fill up”

– They won’t have any history when you first build them. Give them time before you commit to numbers

• If possible sell users not impressions• Beware of overlaps – your ad

system/forecasting system might not be

Pitfalls!

+ ≠

Inventory Overlap

2X

Pitfalls!

+ =

Inventory Overlap

Combining two segments in an inventory forecast will never give you the sum of both segments!

There is almost always SOME overlap.

A quick note on pricing

• Different Philosophies1. Targeted inventory = Segment Property2. Targeted inventory = Premium on delivered

property3. Targeted inventory price calculated by supply

and demand

1Sports Channel CPM = $15

Sell a segment of sports users for +/- $15 regardless where it runs

A quick note in pricing



and demand

2ROS Sells for = $1

Sell a segment of sports users on ROS for $2.50

A quick note in pricing



and demand

3Each segment’s price is dynamically calculated using a pricing system

System Integration

• There is not a lot of integration between the 3rd party offerings and– Inventory Platforms– Order Management Systems– Billing Systems

• You or your champion should work to determine workflow within your organization

Some Implementation Top Tips

• Get your tech team involved from the beginning (ad tags/CMS/structure)

• Involve your sales team in implementation• Go to market with a pre-defined list of

segments• The most obvious initial segments will be

those that extend your high-demand/high sell through inventory

Other Top Tips

• Ensure you always update your site metadata when new area launch

• Ensure consistency between key value pairings and segments across the site

• Be sure to enter at least the top 20% segments in your inventory DB

• Never look at BT on its own but as part of a holistic ad system

• It is NOT a silver bullet

In summary…

• Marketers are excited as BT can help fullfill the original promise of online

• It represents a true NEW way of advertising• Growth is predicted to be HUGE• Vendors are responding to this expect more

and expect consolidation• The technology itself is not super hard• Managing it within your organization can be

tricky

In summary…

• Have a Champion• Be smart about your segments• Be aware of inventory issues• Involve all areas of your organization• BT is NOT an island

Documents

Admonsters Behavioural