Digital Advertising Gets Personal

Gaining Mobile Ground

Though retargeting is not a new phenomenon, the approach has been evolving across various channels and has established a notably new presence in mobile technology. According to a Pew Research Center Internet & the American Life Project study, 91 percent of adults in the United States own a cell phone, and 56 percent—a majority for the first time since Pew began tracking the statistic—own and use a smartphone. Americans are accessing the Web from their mobile devices now more than ever, and mobile advertisers are taking notice. Many are anxious to benefit from the ripe market, and are developing new personalization techniques.

AirPush, for one, is bringing CRM retargeting to mobile, and giving its customers an opportunity to harness the power of their CRM data to advertise more effectively.

CRM retargeting relies on an email database that has been collected from customers either at the point of sale or through subscriptions. "With the previous model, the only way for you to reach email subscribers was through email, but technology has emerged recently on the Web that allows companies to take their customers' email addresses and match their encrypted email address with an online user," Delug explains.

"If a brand has the email addresses of 100 people [who] bought big-screen televisions, they can now show display banner ads to those 100 people wherever they may be on the Web. Now companies can use customers' CRM data for this. That's a huge departure from the traditional approach," he adds, "and we're bringing it to mobile."

Personalized advertising is being injected into other channels as well, including cable television. Cable companies are becoming increasingly interested in the trends occurring in the video-on-demand (VOD) field, and are looking to implement similar approaches on live TV. When a viewer watches a program through a VOD provider, the provider knows which ad was displayed to the viewer and who that person is. "This is valuable in tracking exposure to conversion, and also helps to open up the right ad in front of the right person in VOD," Zwelling says.

Personalizing advertisements on cable programming is more challenging, but the practice is slowly becoming more widespread. According to Zwelling, cable television works with 815 regions, with each region made up of 32,500 households, and each household represented by an individual node. These nodes can be broken up into zip codes with high conversion rates and low conversion rates, allowing advertisers to gain a deeper understanding of the consumers living in different neighborhoods.

"When you break down the geographic regions by conversion rate, what you find is that if you want to sell, say, expensive decorative lighting, the conversion rate in Manhattan zip codes is ten times higher than the conversion rate in Toledo," Zwelling says. As a result, advertisers pay a lot more money for customers in the upper-echelon zip codes because they're more likely to buy. "This is becoming really important for cable advertisers, because this means that they don't have to buy all 815 [regions] equally. They can determine which ones convert and perform better, and only choose to pay for those. We're just now seeing this start to happen, and it's really exciting," he adds.

Despite innovations in real-time advertising and retargeting, experts agree: These methods aren't for everyone. Personalization is expensive, and it doesn't work for all brands. For it to be successful, the brand has to not only have a critical mass of potential customers, but also a deep understanding of the most effective ways to reach those customers.

"If you've already captured a respectable amount of email addresses and have a solid email marketing campaign in place, maybe you should focus on using your ad money to reach people whose address[es] you don't have. To get a recovery through email might cost you fifty cents, but to get a recovery through ads might cost you between five and twenty dollars. If you're on the twenty-dollar end, that rules [out] a lot of [companies], because they don't have the money in the budget to make it work," Nicholls says.

Still, it's hard to deny that real-time personalization and retargeting are gaining an incredible amount of traction in the advertising industry. "Up until quite recently, advertisers have had to settle for advertising to types of people. They had to ask themselves, 'What type of consumer is interested in this product?' or 'What type of consumer would purchase this?' But those questions are largely becoming obsolete. We can stop looking at types, segments, and broad audience groups. We now have the technology to look at an individual's real-time behavior, and create a targeted, personalized campaign for that individual," Zwelling says. "Personalized advertising is simply better advertising."

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Associate Editor Maria Minsker can be reached at mminsker@infotoday.com.

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