ADOTAS EXCLUSIVE — In looking at the bevy of online advertising networks in the marketplace today, it seems increasingly evident that targeting is rapidly overtaking inventory quality among ad networks as the one aspect that their value hinges on and the one that truly differentiates them. Targeting arguably has become the ad network “killer app.” According to E-consultancy 2007 Online Ad Network Buyers Guide, targeting was only 1% behind inventory quality as the single most important differentiator. That was 2007 and the war has escalated considerably since then. Now I’d argue that the single most important factor and point of differentiation within the 400+ ad networks in the marketplace is their targeting.
Inventory quality is still an ultra-critical factor when evaluating ad networks but it has become more like a commodity. Everyone has great sites and can whomp up a spectacular site list with all the visual shock and awe that anyone can imagine. But targeting — good, precise, accurate, performance-driving targeting, takes real technology, which is actually a pretty rare commodity among the ad networks. Most ad networks are made up of people and publisher relationships. That’s how they scale. Add more sites and ad more sales people and the incremental revenue will follow.
Targeting in today’s ad network environment usually means either by behavior, demographic, or context. And all can work to raise performance of the average direct response campaign — or create additional recognition and recall for brand campaigns. Just like transparency means many different things to many different networks, not all targeting is created equal. For instance, behavioral to one network may be just re-targeting to the next network. And then there’s contextual. Most don’t know that in many ways behavioral is based on contextual. In this scenario, behavioral is a contextual solution with a time element.
So what’s the best targeting solution out there to ask for? This usually involves determining what targeting will provide the most performance enhancement for your campaign. And that, of course, hinges on what your key performance indicators are going to be: Is it clicks, acquisitions, brand awareness or a combination or something else entirely?
In many ways contextual targeting may have a leg up on the rest. Behavioral offerings almost always have a contextual component driving their segmentation, so it is one of the most mature technologies out there. Semantic relevance engines have been around since the early days of Knowledge Management in the early 90s — even before the first AT&T banner ad was sold by Doug Weaver to Wired.com. And contextual side-steps any privacy issues, as it derives its relevance from the page content as the ad is being served and does not need to ask private questions or save little bits of private data behind-the-scenes. Perhaps most importantly, contextual targeting has frequently shown to offer both more lift in clicks and more brand recall than other targeting solutions.
From a practical standpoint, when you are out there shopping for an ad network and everyone is pitching transparency, great publisher sites and more performance, it would be well worth your while to stop and ask about targeting: Don’t be afraid to ask about technology, either. Most likely you will find little behind that curtain besides some basic channels, a little re-targeting, and a status report. Ask for a proof report and see where that leads you. Can they offer proof of why they targeted a certain page with a specific ad? If not then there is probably little technology back there. I’d keep looking, because as targeting continues to ascend in importance, so too will the need for ad networks to add real technology and targeting to the people and publisher relationships already in-place. At the very least, it will be interesting to watch how ad networks adapt, adjust, and try to differentiate themselves in an environment that is perhaps more focused than ever on targeting.