Big Data will Change Advertising Forever

bigdataI had several meetings today with friends from “traditional digital agencies”. [Aside] That sounds so oxymoronic! The reality is that this new course of big data, gleaned from a wealth of unstructured information on the web, has the ability to turn advertising on its head–– at least enough to make media people rethink algorithms for maximizing performance.

Coming from the ad world, I have seen the banner ad rise and fall in a span of 7 years. The value of search marketing (PPC) has had its heyday and now even some of the search pundits are realizing an eventual downturn. Consider this quote from Adam Torkildson, one of the top SEO Consultants in the country who was quoted in this Forbes Article, “The Death Of SEO: The Rise of Social, PR, And Real Content” who said,

“Google is in the process of making the SEO industry obsolete, SEO will be dead in 2 years.”

A large part of this statement lies in the the fact that expectations of consumers have changed. In advertising. In content. In brand engagement. Social content is what largely makes up Google’s search algorithm: relevance, recency. What this entails? Shares, comments and reviews.

I would argue that another factor will unseed Paid Search as providing a more relevant prospect framework: social data insights.

The Traditional Ad Model: User profiles

Think back. Acquisition targeting parameters were dictated by marketers. Marketers did the consumer research, mainly expensive focus group testing with questions that largely served to benefit the “business”, structured and moderated by the “business” and highly subject to group-think. To top it off, this “focus” group would provide the basis of “representation” of the target customer, so the results of the research were leveraged to inform the targeting strategy. So… my point: the research conducted was subject to false assumptions, questionable methodology and a strong reliance on the outcomes.

Now, these outcomes provided the demographic profile of the target customer, which was fed into the media buy. User profiles dictated where, when and the type of offer or content was served. At that time there were mediocre optimization opportunities.

The More Sophisticated Ad Model: Behavioural targeting

I was fortunate enough to work for Hunter Madsen, the Yahoo! guru who led the team that developed Behavioural Targeting for our company back in early-to-mid 2005. We were in awe as Hunter explained the mechanics of targeting users within the network, based on where they’d been, what content they consumed, what they searched for… also taking into consideration their geography, demographics and alignment with the target profile. Aileen Hernandez Halpenny, a friend who heads up Rocket Fuel in Canada, reminded me of the “smart ads” — the dynamic ad units that would be served up to you based on geography, profile, search propensity etc. These were seemingly intuitive ads that knew the right offer for you at the right time. Simply put, “Optimize each ad for each user — right down to hyper-targeted local offers — so that you can drive your objectives, from awareness to conversion.”

Now, combine that with ad retargeting that cookies a user and serves up a similar ad when they show up elsewhere in the network. Now we’re talking relevance. No longer do we have to rely on latent conversion and assume that an ad I saw 10 days ago contributed to my online purchase of that same product. Retargeting takes out that guesswork.

The Future Ad Model: Enter Social Data

Now imagine if you had the best of both worlds: behavioural data AND conversation data. Case in point: So Mary Brown searches for information about a future trip to Halifax, NS. She also goes to travel sites, reads hotel reviews and has excitedly spoken to close friends on Twitter and Facebook about her plans and preparations. Now we have not only recent behavioural activity where she’s been on the internet, but we also are aware of her conversations that validate her behaviour. It is safe to assume that Mary will “definitely” be going to Halifax. Imagine what this information does for a travel company? They now have MORE information on that user that will allow them to not only serve an ad, or respond to that user with relevant offers, but DO so with a certain degree of confidence that Mary, will, at the very least click on the ad.

What excites me about social data is that it does the job of the marketer, for the marketer. No longer do we have to guess about “who” is right for our product. The conversation data alone is enough to verify the right target audience. But, coupled with recent/past web behaviour, the two variables will increase response lift significantly.

Caution: this may be a game changer but the way the advertiser needs to treat the user must also change. Ads, for the most part, have becomes irrelevant. Even Facebook is realizing that low Click-throughs (CTRs) on sponsored stories is not enough to drive conversion. They are now relying on “impression-based” ads ie “I saw the ad” vs. “I clicked on the ad” to determine whether this can be attribution factor with conversion.

How do traditional media people feel about this? An ad ops person put it this way: “Conversation data may yield us potentially top 20 people who have a higher propensity to buy. Is this enough? The client wants more volume.”
…to which I responded,

“Social data allows you to target to very niche groups — the tighter the targeting the better. After all would you rather have a much higher response rate, spending less on advertising, targeting a more finite group than doing a blanket campaign across a larger volume with a standard .15% CTR? ”

The value of social data is the amplification value and allowing social strategies for outreach to augment the ad performance. This results in BOTH a higher response rate as well as word-of-mouth effects. It also allows the marketer to spend more wisely and opens the door to developing sustaining relationships with the consumer.

…. after all, why should our work as marketers get any harder!

Personal Branding comes to Infographics: Introducing @Piktochart

So, it was time to update the CV and I passed on my mundane 8-page resume to a recruiter. It read like a book, and anyone even wanting to know about me would not even get passed the first page. The recruiter was blunt and told me I was in dire need of a major clean-up on my resume. I would have to hire a professional resume builder or somehow figure out how to maximize my profile–on my own.

Then I ran into a friend, @carmineporco who directed me to a site called Piktochart. So, I thought especially for those archaic recruiters who don’t go to LinkedIn, and still need to see the standard CV, this is a great way to spice up your profile: your CV in pictures.

Piktochart is a really simple interface: It’s all drag and drop. You can upload images, choose from many different templates that include cool charts and graphics. It’s perfect for people, like me, who have no real design experience. Edit and save your work online and download it as a .PNG file. Try it out for free.  You get 5 different templates to choose from and are only limited to 5 image uploads. Plus, you’re mandated to include the Pictochart watermark. But for $29 per month, you get 80+ themes, unlimited image uploads, better customization and the option to exclude the watermark.

Take a look at my CV below. This one took me about 8 hours – only because I was picky about the colours and how I wanted to present the information. Try it out! It’s awesome!

What happens on the Internet in 60 Seconds? [Infographic]

Thanks @suzemuse for this. I’m gonna add it to my collection of cool infographics.  Here’s a link to the original post: Here’s the link to the original post: http://t.co/bvD0m31

What_happens_on_the_internet_in_60_seconds

The Internet Economy will only Survive with Proper Privacy Disclosure

I recently wrote a post in What’s Your Tech entitled: Google vs. Facebook: It’s all about Privacy.

My background is in database marketing and I am a firm believer in full disclosure to the consumer. This has been the practice for any one-to-one communication regardless of channel. It’s the reason why loyalty programs, direct mail even telemarketing have been strong purveyors of communication and insight.  Transitioning this principle to the internet should not change the principles. In fact, given the amount of information that people are creating and sharing on these social platforms should leave all of us to question how some of this information will be used.

Two additional news items came to light in the last few days:

Given the amount of media scrutiny on this issue, Twitter is actually taking a proactive step in identifying apps that may have access to user information, specifically DM, and taking steps to properly inform users within the OAuth session. At the same time they are mitigating any future access from apps by eliminating the DM data. Smart move and good for Twitter for staying under the radar on this one!

The bill (SB 242) would prohibit Facebook and other social networking sites from publicizing users’ addresses or phone numbers without their explicit consent.” Not surprisingly , Facebook, Google, Twitter, Skype, and Yahoo, among others have banded together and denounced the bill calling it unconstitutional and hurting tech companies and negatively impacting the internet economy .

I don’t buy it. In fact I think the more these platforms keep from the consumer, the harder it will be to garner performance from advertising.  I also disagree with the argument that the common user does NOT understand how they’re data is being used, nor do they care.  The amount of media attention to this topic has certainly been enough to convince the people around me that they have to really manage what they share and don’t share. Why not give the users the benefit of the doubt? Are companies afraid that “consumer knowledge” will render their platforms less attractive to marketers?

Coming from the banking industry and from a country that is relentless in protecting user information, while there are limitations there’s an even larger negative impact on the business: reputation and eventually…. churn. From a customer viewpoint, “If you protect my information and you are up front with me about how you use it, I will trust you more”. I’ll take it one step further….”I will tell you about the things I like, don’t like, when I want to hear from you and in what channels”.  “If you go behind my back and you use my information that I haven’t given you permission to use, then our trust is broken and I will have one foot out that door”.

I worked for Yahoo! and I know the billions of ad dollars to be made is in tracking user behaviour: what they search for, where they spend their time, how recently … all this in order to offer targeted ad messages that provide real relevance for the user. To do this, cookies were absolutely essential. But Yahoo! was also adamant that external networks didn’t infringe their own cookies on the Y! user base so from that perspective they were “protecting” their users. Yahoo! openly disclosed this in their Terms of Service.

But Yahoo! and many of the Internet giants need to be more transparent in their disclosure and more user friendly.  Do-not-call List or Permission Marketing has NOT killed Telemarketing, Direct Mail or Email marketing. In fact the opposite is true: The final opt-in base may be smaller but the performance will be better. This will also hold true for the web.

What’s your opinion on this?

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