Chatting With Behavioral Targeting’s Darlings, Part 1

If you’re anything like me, months can go by without catching up on your key partners’ developments. If it’s been awhile since you got up to speed with your Revenue Science and Tacoda reps, consider this and next month’s columns your CliffsNotes on what’s happening with the industry’s behavioral targeting darlings.

Today, a Q & A with Marla R. Schimke, VP of marketing at Revenue Science. Next, we’ll chat with Tacoda.

Anna Papadopoulos: What major developments do you see in the digital space, specifically behavioral targeting?

Marla Schimke: Two major changes over the next 6 to 12 months are behavioral targeting will begin taking a much larger share of online advertising dollars, and we’ll see behavioral targeting move from the Web to other devices.

AP: What do you think is driving these changes?

MS: As consumers exert greater control over the delivery of content — not only time, but also device — advertisers will need a more effective way to engage and connect with their audiences. The solution must deliver ads that people want to see, regardless of the device those ads are being viewed on, and behavioral targeting is the answer. A recent study Revenue Science conducted with JupiterResearch showed that consumers are more receptive to behavioral ads across every category measured.

AP: How has your company responded to these developments?

MS: We have taken the lead in deploying behavioral targeting to mobile devices. We’re starting in Japan in November, and we are excited to bring this opportunity to the United States.

AP: What new products have you introduced in the last year in reaction to new developments?

MS: Along with our mobile partnership, we have launched new vertical segments, like technology and travel, that will enable advertisers to reach their desired audiences. We were also the first to develop and launch Search Re-Targeting.

AP: What do you think about Tacoda’s merger with AOL? Do you have any plans for a merger?

MS: We lost a competitor and kept a great customer, so I think it’s a win-win situation.

AP: What are the top categories that are embracing behavioral targeting? Why do you think this is the case?

MS: Since day one, the automotive and financial industries have embraced behavioral targeting. They understand their consumers and the purchase funnel, leveraging a behavioral targeting strategy to win their business.

AP: What role do you believe social media plays in the behavioral space?

MS: Revenue Science has been helping advertisers target prospects on social networking sites for over two and a half years. In fact, we were one of the first to embrace the long tail. The growth of the tail, and the shift of mainstream consumers’ reading to the tail, is very significant because it has required publishers and marketers alike to get skilled at aggregating reach by adding up targeted volume rather than simply concentrating on high-volume, untargeted places. It also means that power is now shifting away from those who control distribution in favor of those who embrace fragmentation and learn to aggregate targeted reach.

AP: Is behavioral-targeting spending going up or down? Why do you think this is the case?

MS: Behavioral targeting spending is on the rise, mainly due to companies understanding that [behavioral targeting] works. Every day, [there’s] more evidence, like our study that showed behavioral outperforms contextual advertising by as much as 22 percent.

AP: What would you say to a marketer who is thinking about behavioral targeting but hasn’t taken the plunge?

MS: To get the maximum benefit from behavioral targeting, you need to take a strategic view and really integrate it into your overall strategy. Running a few small tests will never get the desired results. Let us help you by sitting down to discover what your goals are, looking at what you are already doing and seeing how to best incorporate all aspects of targeting, from behavioral targeting to retargeting and more, into your plan to achieve your goals.

AP: How are you handling behavioral targeting in the emerging media space (video, blogs, etc.)?

MS: This type of content is a gold mine for behavioral targeting because by and large it does not carry the depth of context needed for a traditional advertising buy. At Revenue Science, we call it the “contextual desert,” and it makes up the vast majority of the Web today. This fragmented, personal, and unplannable content requires advertising relevant to the person viewing it, rather than the content itself.

AP: If you can change one thing about the way behavioral targeting is handled or viewed, what would it be?

MS: I’d like to see behavioral targeting be at the forefront of every media plan. We need to reach consumers based on their interests and behavior. When planning our campaigns we need to always put the consumer first, and that means understanding what behaviors motivate them to make purchasing decisions online and offline.

AP: Will there be any developments on the international side?

MS: We are the leading provider of [behavioral targeting] in Europe and Japan. We saw the promise of deploying behavioral targeting to mobile devices with our partners in Japan and are excited to bring this opportunity to the United States. Mobile use in Japan is much more sophisticated than in the U.S. This venture has enormous potential in Japan because the number of mobile phone subscriptions in Japan topped 100 million in January, and, with a total population of roughly 127 million, mobile phones have penetrated the Japanese culture at a staggering rate of 78 percent. The Japanese use mobile phones for a wide variety of purposes, such as banking, purchasing items from vending machines, and watching video. The most frequently used function is browsing the Internet (even higher than voice usage), and this has opened the door for behavioral targeting.

AP: Did I miss anything you’d like to discuss?

MS: We’re seeing tremendous growth in the U.K. and Europe. We brought behavioral targeting to the U.K. and really have a dominant position there with brands like “The Guardian,” the “Financial Times,” “The Sun,” and “The Telegraph.” I am excited about a world where advertising becomes content and consumers welcome it as a way of life. I think the ability to combine mobile and PC behaviors that include search opens a new door for advertisers to reach their target audience with the most effective advertising possible today.

Including actual physical location in behavioral targeting is next. What’s going to happen once GPS-chip handsets are out is that an advertiser can target a consumer based on where they are with their mobile device. So you can reach a consumer when you know they are approaching, say, a Starbucks or a clothing store at the mall with an ad customized to them, like a free cookie with your laté or 10 percent off on a new pair of boots.

Thanks, Marla. Next up: Tacoda.

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