Improving the Performance of Display Advertising

In tight economic times, where the media planner tries to make every ad dollar spent count, online display advertising solutions seem to want to relate their message to a media proven to work: search. I recently heard from three relatively new and intriguing ad technologies with this kind of “performance messaging.”

Performance Advertising for Retailers

Two years ago at an ad:tech conference, serial digital entrepreneur Shaukat Shamim looked around at all the online advertising companies represented. He realized that despite them all, only one entity, Google, was receiving the bulk of the online advertising dollars. The reason? Search delivers results. Diving a little deeper, Shamim saw that Google’s top 100 advertisers were primarily retailers, so he wanted to develop a display-based advertising solution that provided search-like delivery and ROI (define).

The outcome, Permuto, delivers “intent targeting” by partnering with shopping engines and other sites to start the data collection process. Product information the consumer searched for is stored on Permuto servers, and the advertiser can bid on the opportunity to place “personalized and branded dynamic advertising in front of qualified leads matching [the retailer’s] product catalog.” Permuto’s algorithms enable SKU-level (define) targeting for merchant advertisers. There’s also a similar retargeting solution to target consumers who visit advertiser Web sites but don’t complete a transaction. With Cyber Monday right behind us and the online holiday shopping season now in full force, Permuto’s promise will be put to the test.

Levering Social Data for Custom Targeting

Back in August I wrote about social media advertising and mentioned an elusive company called Media6Degrees. The company is now ready to come out of stealth mode and explain its ad technology. Using research from AT&T Labs that showed “any person in contact with an existing customer of a firm is three to five times more likely to respond to a message from the firm,” Media6Degrees founders saw a similar opportunity with the advent of the social Web.

At the heart of its technology are three primary components: a pixeled (“tagged”) advertiser Web site, site visitors who demonstrate a certain degree of interaction (“loyalty”) with this site, and anonymous user data collected by third-party social networking applications and shared with Media6Degrees. Once a loyal user has been identified, Media6Degrees looks at its user data to find and target advertising to their friends. Ad inventory is purchased by Media6Degrees on ad exchanges and sold to advertisers on a CPM (define) basis, but managed based on performance to an effective CPA (define) level.

Company CEO Tom Phillips, an ex-Googler, also sees Media6Degrees’ type of targeting as a way to help improve exposure and ROI for search advertisers who don’t necessarily fall into the top five “winning” positions on the SERP (define), as well as those who are winners but who just want search-like performance outside of search. Media6Degrees has been primarily working through ad agencies, which are still responsible for producing the ad creative. While campaigns can be integrated with third-party ad servers, Media6Degrees’ own reporting is still a work in progress.

Large-Scale Data Matching

What if the speed and query power of Google could be brought into online advertising in a way that allowed publishers or networks to provide better targeting or predictive modeling? In a way, that’s what Netezza helps digital media do. Netezza is actually a piece of hardware, an appliance that processes multiple data points in real time at 100x the speed of a traditional database.

Digital media companies plug into the Netezza appliance to help them deliver better campaign results or give better data feedback. For example, a Netezza analysis can tell not just the last click of a campaign but all of the touch points of a multi-channel campaign; invaluable information to a marketer. Netezza can power predictive modeling to tell how many ad impressions it would take to secure a large enough audience to meet an advertiser’s performance objective. By using Netezza, rich complex reports can be generated and delivered in a day instead of weeks.

Media planners can’t plan an ad buy directly from Netezza. Instead, it’s useful to know that networks like AOL and AppNexus are being powered with Netezza data processing or that the agency itself can use the Netezza appliance to analyze and optimize campaigns to more precise performance levels.

The pressure for ad performance is greater than ever. Expect to see more online media solutions carrying forth the performance message in the year to come.

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