Fetching Back Behavioral Targeting

In the science fiction movie, “Minority Report,” Tom Cruise plays a police officer forced to flee after he’s falsely accused of a murder he has yet to commit. At one point in the movie, Cruise’s character walks through a mall and is personally greeted by electronic billboards and displays ads, like a Gap ad commenting about the shirts he last bought. Let’s see how behavioral targeting evolves from the seeds planted in the present to the not-so-distant future.

To provide more insight into this topic, I caught up with Chad Little, chief retriever for FetchBack, a company that’s developed innovative technology aimed at “retargeting” advertising and marketing toward consumers.

Elyse Tager: Explain in more detail about your patent-technology and how it can evolve behavioral targeting for the future.

Chad Little: FetchBack has developed technology from the ground up by industry veterans who had developed several other ad-serving solutions over the years. The idea was to combine our knowledge of the industry, having developed several other ad-serving solutions, and develop the ideal technology solution for delivering retargeted ads. It’s our vision that retargeting will become a line-item budget for marketers. Advertisers will need the most robust solution available to meet their CPA [define] objectives and at the same time allow the mom-and-pop shop to have access to this type of advertising.

The portion of the technology that will be most beneficial to marketing professionals is the comprehensive ROI [define] reports that can be generated. It allows them to track where every advertising penny is being spent over a given time period.

The heart of our technology is to simplify the process of implementation so that everyone can use it and at the same time provide more conversions for any given advertiser better than any other product on the market, provide the most comprehensive analytics specific to retargeting, and deliver the most conversions by delivering substantially more reach than any competitive network.

Other than paid search and affiliate marketing, this is the only form of advertising that can work for any advertiser, regardless of size. We believe our technology and vision substantially evolves the behavioral advertising marketplace, as other forms of [behavioral targeting] will not work for everyone. Essentially, this is a way to democratize behavioral retargeting and level the playing field.

ET: How can e-tail sites that fail their customers with their recommendation functions refine them to better address what their customers want?

CL: Well, this is not exactly where our expertise lies. Ultimately, though, it boils down to data and learning how to interpret that data. Categorized [behavioral targeting], retargeting, and recommendation engines are all trying to give users more relevant information that can ultimately enhance their experience online.

Criteo is a company doing interesting things in the space. As they refine their algorithms and expand the breadth of factors included in those algorithms, recommendation engines will become more accurate in predicting what actually is relevant to a customer. The more experience a company has, the more data they have and the more accurate they can be in their predictions.

A lot of things go on beyond the click, but who knows whether or not the companies developing these engines are looking there. No doubt they are getting more and more intelligent, though.

Watch for companies taking relevant recommendations outside their Web site. It rained in Phoenix a couple weeks ago, and that day a friend of mine got an e-mail from Amazon about a new pair of windshield wipers. I told him he was a fool if he thought that was mere coincidence.

ET: What is the current status of behavioral targeting technology and its uses from an e-tail perspective, and how far can we take targeting in the next generation?

CL: Behavioral targeting can be put into two segments: categorized behavioral and retargeting. We believe that retargeting is significant enough to have its own focus outside of categorized behavioral targeting. We believe strongly that most e-tailers can double the effectiveness of their current ad spends by retargeting alone, with plenty of room to grow.

The only thing hindering this idea from skyrocketing is privacy concerns. We collect absolutely no personally identifiable data, but the subject is very much in the forefront of the media at the moment. If this topic can be overcome and communicated, then we really are just looking at the very beginning of the possibilities associated with [behavioral targeting].

Future growth will come from a deeper understanding of what each individual consumer is interested in on your site, something provided by current [behavioral targeting] companies. And a greater understanding of how they landed on your site will help to better target individuals based on every single action taken to get to your site.

We’re seeing that retargeted impressions are having a big effect on client traffic. This data goes far beyond the click though. We’ve started looking at really granule data with regards to view-based conversions. Banner ads have had a bad rap in the past, but look for targeted banners to become a more valuable part of a marketing plan, as the information we’re seeing starts to surface. It’s literally industry-changing.

Another factor in the future success of [behavioral targeting] is the creative content that your consumers will see. So much of online advertising’s focus has shifted to paid search; rich in text, lacking in creativity. To date, display advertising has been relegated to the few. Retargeting hopes to reintroduce the importance of creative online advertising to marketers who have grown very accustomed to the simplicity and ease of paid search. What becomes effective with retargeting is the ability to dynamically select ads based on the actions a visitor has taken on the Web site. It’s already a challenge for companies to get quality online creative. As interest increases in targeted banner advertising, the problem is only going to become more prevalent.

Better analytics will be needed to monitor performance that goes well beyond clicks to paint a much more accurate picture of the effect on the consumer; and these analytics need to be proactive!

ET: Do you expect the type of retargeting that you do can translate well into the offline world, like being reminded of shirts you bought at the Gap?

CL: We can see the beginnings of this happening with the Amazon e-mail campaign in the example I gave earlier. Retargeting and [behavioral targeting] will expand first to every other form of online advertising. And as the Internet becomes the delivery mechanism for other media, the line between online and offline will blur.

The key to making something like this work offline is the ability to deliver messages that are timely and dynamic. The commercial printing industry has been trying to make direct mail campaigns more relevant for a while now. I could easily see an intelligent e-tailer taking the customer data they gather on the Web and integrating that into not only retargeting and e-mail campaigns but a variable-data direct mail piece as well.

Based on what we can see from our data, we see an increase in total conversion rates for our advertisers that are coming especially from those who were simply exposed to the ad. There’s no question that retargeted ads influence purchasing behavior. Even if it’s on a subconscious level, it would just be a matter of tying together the offline and online worlds that would be the tricky part.

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