Madison Avenue in 2011

Written on
Dec 27, 2010 
Omar Tawakol  |

madison_smallADOTAS – You would think that a maturing industry would have a slower pace of growth than a brand new one. You sure can’t say that about display advertising! I’m a speed junkie and the rate of change in our industry is fast even for me.

Just when Madison Avenue was ready to finally put 2010 and the Great Recession behind it, the advertising community got news the Federal Trade Commission was calling for more regulation of our industry. Discussions around consumer privacy and data utility continue to alter the narrative of the pros and cons of digital marketing and pose some significant questions for the advertising industry as we head into 2011.

Putting on my Nostradamus hat, here are some quick predictions on what every “Mad Man” should expect next year.

The Industry Strikes Back. With the rise of government interference, self-regulation is going to play a vital role in the privacy debate and 2011 promises to be a year when the online advertising community produces real progress.

We’ve already seen organizations like Online Behavioral Advertising (OBA) and the Digital Advertising Alliance (DAA) apply consumer-friendly standards to online advertising that provide book-end transparent solutions that is aimed at giving users clear disclosure at collection, clear in-ad notification and universal opt-out choices. Look for more self-regulatory programs like these to be implemented at a rapid pace in 2011 with a few key players driving the majority of the innovation.

The greatest irony of 2010 was that the government convinced consumers that they should have rights to understand their citizen’s behaviors and businesses are the ones that need to be regulated. In my humble opinion, the answer lies not only in self-regulation but also in an equal attempt by lawmakers and privacy advocates to truly acknowledge the benefits of subsidized content and the trade-offs in a non-advertising world.

Let’s focus on practical solutions that give choice and transparency to consumers over broad opt-out tactics that can negatively impact an otherwise thriving industry.

People Not Proxies. If 2010 was the year that audience targeting went mainstream, 2011 will be the year that data will impact the entire media-buying process. For decades marketers have been used to using rough proxies to tell them where they should spend their marketing dollars.

Surveys and panels have helped marketers find the right zipcodes, TV shows, content sites and newspapers as proxies for where their consumers might be. While marketers spent billions on these gold plated slingshots (the proxy tools) – search came along and empowered marketers with heat seeking missiles.

Search taught us to abandon the proxy and go straight to the people who want to find us. Data targeting, simple retargeting and search finally break our dependence on proxies.

People buy our products and people have passion for our ideals. Marketers will flip their planning paradigm to go straight to these people rather than the poor substitutes we find in proxy-based segmentation.

We will even begin to see online segmentation techniques drive cross channel segmentation. Specifically, this means that new planning tools will give marketers the ability to craft their entire marketing funnel based on all available first and third party data. This will inform who their customers actually are and who should see their next round of ads. Goodbye proxies; hello people.

The Rise of the Quants – While there will always be a need for the Don Drapers of the world, many agencies are trading in their cigarettes and whiskey glasses for complex mathematical formulas and spreadsheets.

I have no prediction on whether or not the quants will be popular dates but they certainly will find jobs. Quantitative analysts are the hot hires at agencies, which increasingly need data jocks who can better understand consumer audiences and their purchasing behaviors to optimize for ideal campaign performance.

The rise of the quants will only intensify in the coming year, as more and more agencies adopt media strategies that rely on in-depth data analysis and audience profiling.

As online media continues to transform Madison Avenue, 2011 will be a pivotal year for the advertising community. It must remain steadfast in its commitment to creating real transparent solutions for consumers while staying laser focus on data.

If we can strike that balance, 2011 may go down in the books as one of the most influential for the industry. Happy 2011!

As Chief Executive Officer at BlueKai, Omar is responsible for the overall management, growth, and vision for the company's groundbreaking exchange business. Prior to founding BlueKai, Omar was the Chief Advertising Officer of Medio Systems, the leading provider of mobile search and advertising solutions for carriers such as Verizon and T‐Mobile. He joined Medio from Revenue Science, where as Chief Marketing Officer and General Manager he was instrumental in founding and growing the company's leading behavioral targeting businesses, which provide services for many of the largest Internet publishers. There he was actively involved with key industry leaders in defining standards for behavioral targeting.

Omar earned Master of Computer Science and Industrial Engineering degrees from Stanford University and a Bachelor of Engineering degree from MIT. While at Stanford, he was a computer science researcher at both the Stanford Logic Group and HP Software Labs. Omar's research on formalizing content was published in the American Association of Artificial Intelligence. Omar is also an active speaker and commentator on topics such as behavioral targeting, mobile advertising, and consumer privacy. He was listed in Media Magazine's Media 100 for 2008.

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