Behavioral Targeting's Different Flavors

  |  June 21, 2006   |  Comments

The two different types of behavioral targeting: which to use, based on campaign objectives.

I love ABC's "Lost." There are the obvious reasons: the drama, characters, and location, but the most important reason is it's the only thing on TV my husband and I can agree to watch together. On his side, you've got action movies, and on my side you've got soap operas (yes, I admit it). "Lost" is our common ground.

I've always thought of interactive advertising in the same spirit. It's the only vehicle that can appease both advertisers with direct-response goals and those with brand-awareness objectives. Based on their specific objectives, they can call upon an arsenal of strategies and tactics. Ordinarily, behavioral targeting is one strategy I use for direct-response goals, but recently I decided to apply it to a brand campaign for a financial services client.

Guess what. Overall opinion of the advertiser's brand increased 35 percent, and future purchase likelihood increased 25 percent.

According to "Effective Targeting," a report published this month by JupiterResearch, advertisers who have used behavioral targeting in the past 12 months are 17 percent more satisfied than advertisers who have not used it, despite campaign objectives. In addition, the report forecasts that even though 14 percent of advertisers have used behavioral targeting in the past 12 months, 23 percent plan to use it in the next 12 months. Advertisers with long purchase cycles are even more likely to use behavioral targeting, with 29 percent likely to use it in the next 12 months. These are staggering results considering behavioral targeting remains undefined and ambiguous to most.

Advertisers must select vendors based on their objectives and clearly understand their provider's application of behavioral targeting. Unlike other forms of targeting, each provider can treat behavioral targeting quite differently. It's analogous to a country's standard language versus a region's dialect.

According to the report, 71 percent of advertisers planning to use behavioral targeting have objectives concentrated on branding, while 56 percent have goals focused on driving online sales. In an attempt to apply a definition to behavioral targeting, JupiterResearch ascribes the following terms based on the campaign's objectives: "extended-content targeting" for branding campaigns and "purchase-intent targeting" for sales-oriented or ROI (define)-focused campaigns.

Extended-content targeting reaches an audience that's demonstrated an affinity for specific interest-based content. If a consumer looks up three recipes in a week, for example, she may be identified as a "cooking enthusiast" and later be targeted with a wine ad when she's doing something unrelated, like reading a horoscope. Since impressions on content sections or sites are limited, this strategy allows publishers the opportunity to expand their inventory while providing advertisers with an opportunity to continue to reach a desired audience.

Purchase-intent targeting reaches an audience that's researching a product or service. The advertiser determines what actions an in-market consumer may take. Once the consumer demonstrates them, the advertiser serves her ads to persuade her purchase intent. A consumer who researches a trip to the Bahamas may see an ad with a special offer later when she's reading the news.

Purchase-intent targeting also refers to retargeting or remessaging. Advertisers target consumers who have visited their sites but not necessarily the publisher's site. If a consumer visits the SUV model page of an automotive manufacture's site but leaves before requesting a quote, the advertiser can retarget that consumer on a publisher's site. Ad networks such as Drive Performance Media offer these types of solutions.

Despite how behavioral targeting is labeled, it depends on not only the actions consumers take but also how often they take it (frequency) and when they take it (recency). Though both are critical for both forms of targeting, frequency is particularly critical for extended-content targeting, while recency is critical for purchase-intent targeting. For the former, you want reassurance that consumers are in the interest-category (i.e., they didn't just stumble on a particular section by accident). For the latter, recency is critical for purchase behavior. Based on the product, consumers can be in market for as little as a day (e.g., flowers). Therefore, there's a short window of time in which to persuade them.

"Lost" and behavioral targeting have a lot more in common than keeping clients and marriages in harmony. For both, the discovery of the characters (consumers) happens over time. The tidbits intermingled in the process -- the visit to a cooking section or a car review -- serve as teasers. But it's piecing together all the elements that provides the complete portrait of the consumer's intention.


Anna Papadopoulos

Based in New York, Anna Papadopoulos has held several digital media positions and has worked across many sectors including automotive, financial, pharmaceutical, and CPG.

An advocate for creative media thinking and an early digital pioneer, Anna has been a part of several industry firsts, including the first fully integrated campaign and podcast for Volvo and has been a ClickZ contributor since 2005. She began her career as a media negotiator for TBS Media Management, where she bought for media clients such as CVS and RadioShack. Anna earned her bachelor's degree in journalism from St. John's University in New York.

Follow her on Twitter @annapapadopoulo and on LinkedIn.

Anna's ideas and columns represent only her own opinion and not her company's.

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