Targeting Moves Beyond the Banner

Much ink has been spilled and many lips have wagged over the topic of targeting banner ads, but another breed of marketing company is focusing on what happens after a prospect clicks and arrives at companies’ Web sites. After all, if it’s so important that you reach people with individualized marketing messages on banner ads, why does your concern stop when they reach your site?

Players in the space include Broadvision, E.Piphany, Cogit.com, and a little start-up called ResponseLogic. For a peek into the world of these personalization players, let’s take a look at ResponseLogic, a firm formed in March 1999 that just last month unveiled technology — called ADAPTe — that helps marketers carefully orchestrate, and personalize, the user experience on their Web sites.

Using data gathered from a variety of sources, including clickstream data, client databases and third party data from companies like Cogit.com, ADAPTe creates profiles of every individual that enters the site. It takes the third-party database information and matches it up with any registration information or cookies on the users’ machines, giving Web marketers a pretty good picture of what type of person is coming on to the site.

Jill McKeon, vice president of Internet strategy at SoldOut.com, a firm that sells tickets and packages to high-dollar sold-out events like concerts and sporting events, says this portrait of her site visitors was what encouraged her to sign up to beta test ADAPTe.

“We’re trying to extract as much information as possible about the users of our site,” said McKeon. “They’re going to allow me, behind the scenes, to profile the site visitors.”

But collecting information about site visitors — data like income, age, gender, marital status, and zip code — is only half of the equation. You’ve got to use it to market effectively to your potential customers.

“What makes a salesperson effective is his personal knowledge of his customer, what he or she wants and needs and what cross-sell and up-sell items might be appealing,” said Jim Scott, president and chief executive officer of ResponseLogic.

“At the start of the twentieth century, you received that kind of service, attention and knowledgeable help from the clerk at your local store. Today, we can offer that same level of service and salesmanship on the Internet.”

That’s the ideal outcome of using ResponseLogic’s technology. Besides collecting and reporting on the people who are using the site, the system allows marketers to tailor content specifically to those profiles. If a married woman with children comes on your site, you might offer a different “sale item” on the front page, than if a single, childless male visited, for example.

The way this works is deceptively simple. Marketers come up with content, and rules regarding that content, and enter it into the ResponseLogic software. The result: if a customer with a specific profile clicks to at a certain page, that action will trigger the matching content to appear on that page. Like a profile-driven targeted banner advertisement, the right content shows up in front of the eyeballs of the right consumers.

On SoldOut.com, McKeon says a male between 35 and 45-years-old might get an offer for a special Bruce Springsteen package, whereas someone with high income might see an offer for a Wimbledon package or a US Open package (which starts at around $2500).

Of course, any talk of profiling is likely to raise the all-important privacy question. ResponseLogic’s position on the issue is to use only opt-in anonymous profiles, which don’t include things like names or addresses.

One of the most interesting thingsabout ResponseLogic is its business model for the technology offering. The company gives away its software, and gets paid only for performance. The software, says Scott, is no more difficult to install than Microsoft Office, so there’s no charge for that. Instead, ResponseLogic and its clients — which include Citibank, SoldOut.com, BabyAge.com, Bibliobytes, and Sundial — agree on a metric by which the company will be judged. ResponseLogic declined to give specifics on how much it might charge.

ResponseLogic says it is first focused on serving e-tailers, then plans to move into selling its services to financial services firms. Besides ADAPTe, the company also offers consulting, for which it charges for time and materials.

Of course, the final piece of the puzzle is assessing the response to different offers, and tweaking the ADAPTe system to be able to maximize that response. So, part of the solution is reporting and analytics so that marketers can, in real time, change offers as needed. The labor-intensive part of all this, of course, is deciding what creative to use and what to target to whom.

What is the result? Well, it’s not yet one-to-one marketing, but it’s getting closer, and it’s getting easier for marketers to control. It’s not hard to imagine that technology like that offered by ResponseLogic will soon become a must-have application, quietly working behind the scenes to make sure the right message gets on the right Web real estate, in front of a consumer who will find it relevant.