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Smart Ads for Smart Advertisers...Are You One of Them?

  |  July 6, 2011   |  Comments

Are you leveraging the newest type of online advertising - behaviorally-based customizable ads?

Dynamic versus static. Personalized versus generic. Smart versus…slow? I'm comparing the traditional type of online advertising to the newest kind - behaviorally-based customizable ads that assemble "on the fly." Coined "Smart Ads" by Yahoo, dynamically-generated ads take into account what users are looking at on the web and serve up creative that are likely to be most relevant to them. The platforms that serve these dynamic ads learn about a user by observing their behavior (and also take into account geo and demo information where available) and select the most optimal combination of a brand's creative elements within an ad unit.

These ads aren't actually all that new - in some categories, this technology has been leveraged for some time. The most common example is within the travel industry. Have you ever been searching for flights from New York to LA and then minutes later you're all of a sudden seeing ads advertising a low rate for a flight to LA? That's behaviorally-generated and it's almost certainly dynamic (because what advertiser in their right mind would create thousands of different creative versions for each potential flight combination?).

The automotive, finance, and e-commerce industries have also been quick to adopt this technology, but the majority of advertisers in other verticals have yet to leverage this platform. But why wouldn't you? Smart ads have many distinct advantages, chief among them:

Reduced creative/production efforts (and costs). Instead of you or your agency creating tens, hundreds, or even thousands of different ad iterations, you can create one ad template that can then be customized on the fly to create a unique ad version using your approved creative elements. Let's take a simple example. Let's say you have the following creative elements:

  • Eight images
  • Five headlines
  • Six layouts
  • Four offers/call-to-actions
  • Seven backgrounds
  • Two logos

Combining all of these will give you (8 x 5 x 6 x 4 x 7 x 2 =) 974,400 potential unique ad versions. With only creating one main ad template!

These ad platforms also create time, effort, and budget savings through their dynamic optimization capabilities. No longer is a dedicated resource needed to review and analyze campaign data to make optimization decisions - this is all done on the fly as well!

Improved customer relevancy. Rather than everyone getting the exact same ad, each user is getting served an ad that is more likely to resonate with them based on what you know about them (anonymously). Again, let's consider another example, this time for an over-the-counter allergy medication. For this product, there are a couple variables that you could take into account with your ad that will make it more relevant to the audience:

  • User's likelihood to be interested in allergy medication (based on search patterns)
  • Pollen levels in the user's location (based on IP address)
  • Weather in the user's location (based on IP address)
  • User's observed hobbies and interests (based on surfing)

So let's say a particular user showed a history of searching for allergy remedies, and based on the IP address, lived in Austin, Texas, on a particular day when the pollen levels were high and the weather was hot and sunny. Finally, this user was likely to be a sports enthusiast based on their surfing patterns. Based on this information, their resulting ad may have the following components:

  • Headline: "Looking to get outside and enjoy this beautiful day in Austin?"
  • Copy: "Don't let your allergies get in your way. Get AllergiesBeGone instead."
  • Call to action: Print instant coupon
  • Image: Person biking outdoors with sun shining

Are you convinced yet? If you're ready to get smart, you are probably wondering what your options are - which advertising partners offer this technology? The big two in the marketplace are no strangers to the online advertising marketplace - Yahoo and Google. As mentioned earlier, Yahoo's Smart Ads technology, powered by Dapper (a dynamic display engine), was one of the first to enter the marketplace in a large scale. After acquiring Teracent (a dynamic optimization engine) and DoubleClick (an ad serving platform), Google is now offering the ability to deliver dynamically-driven ads.

I feel smarter already, don't you?


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Julie Batten

Julie is a member of the senior strategy team at Klick Health, focused on online media and digital. Julie initially established and led the media practice at Klick for several years, relinquishing leadership to expand beyond media into additional digital tactics. She brings a wealth of experience in search marketing, digital media, and all facets of digital strategy to bear, helping Klick's clients develop innovative digital solutions. As her role has evolved, so have her contributions to ClickZ, which she has been writing for since 2007.

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