At the July’s Search Insider Summit in Colorado, there was a lot of talk about click fraud and how marketers are searching for ways to get more value from their search advertising dollars. A number of companies have responded to advertisers’ needs by offering different methods of retargeting.
Early results have been very encouraging, but advertisers and agencies are still trying to understand how retargeting works, where its value lies, and where it fits into the online advertising landscape. At the Summit I explained search retargeting with an analogy that resonated with the attendees, so I would like to share it with you here. I call it the Fisherman’s Tale.
A while ago, in a large ocean, there was a thriving fishing industry. The main players were large guide boats that would take you to fishing spots. They made customers pay for the right to fish on the boat. Some customers would complain that many times they came back empty handed. The guide boat salesman would point out that catching a fish took multiple nibbles. In addition, the salesman would point to a framed picture behind them of a smiling customer that caught a huge tuna. If that weren’t enough they would also point out that the boat was typically booked three months in advance. At the end of the day, many of their elite customers returned so the guide boats did just fine.
One day in a place called the Bay Area, a group of guys from outside the fishing industry found a way to attract large schools of fish who happened to be hungry. Unlike the fish that were spread out in the ocean, these fish would come right up to the surface of the water and look for a net! When the fishery in the bay grew, the owners decided to change the way fishing was done. They called it “pay per nibble.” The stated rules were simple:
1. The fishery gave you a smart net that only caught the fish you wanted.
2. You only paid for the fish that nibbled on your bait.
3. Anyone could fish and the amount you paid was set by an auction marketplace.
The ease of the experience, the ability to get only the fish you wanted (no more dead dolphins) and the payment scheme, made it a resounding success. Within a few short years the Bay Area fishery had a market cap that exceeded that of all the guide boats in the ocean put together.
Now, many people liked to point out that fisheries like this had existed before — and they were right. But this fishery had some unique differences: it made it easy for you to fish, easy for you to change the price for each individual fish species (unlike their predecessors that made you pay the same for a guppy and a tuna) and it allowed you to modify your bait on the fly. The Bay Area fishery just gave you a lot more control, and the flexibility made all the difference.