DaxThink: Digital life

Money may be flowing into online advertising, but website owners are often slow to adopt the necessary tools to bolster visitor profiling, says David Reed.

When everybody talked "about the Internet years ago, they said it would identify people and talk to them in a different tone of voice depending on who they were and what they were interested in. Then nothing happened."

For many online advertisers, still nothing is happening when it comes to targeted ad serving. The above complaint raised by Donald Hamilton, managing director of behavioural profiling service Wunderloop, is a common one. Practices among media owners which would not be tolerated in the offline world are accepted - whether willingly or through lack of choice - in digital advertising.

Take the anecdotal evidence of one advertiser that was looking to generate traffic from consumers in the North of England and Scotland, only to find it was getting hits from the whole of the UK, Hong Kong and Asia. Media plans always include some element of geographical targeting - aligning to TV regions is a typical technique.

But despite the extensive technology and rich clickstream data available to website publishers, they can often not even offer the same level of targeting as a national newspaper. Regardless of such problems, 2007 looks set to be the year when geodemographic targeting finally starts to take hold of digital media, delivering to advertisers the level of audience refinement they take for granted offline.

Lucy Stafford, media director at Tri-Direct, believes growing advertiser investment will inevitably drive better targeting. "Online media have proved that they can deliver results efficiently, even if the sophistication of targeting options is still at a fairly low level. Advertisers and media owners are finally opening up to using more pinpoint targeting options," she says. She notes that much of the attention on targeting has so far focused on time factors, such as day-part, rather than socio- and geodemographic information.

The low levels of targeting are down to three factors: media owners which do not offer the full range of options, advertisers that are not motivated to use them, and advertisers which misunderstand their capabilities.

Of these, the first is the most glaring omission, since many publishers require site users to register and log in, and therefore hold considerable personal data on visitors. "This may be due to technical inadequacies or simply the business being unsure of how to sell these targeting options. In some cases, they are priced out of consideration," adds Stafford.

Deal chasing is common with online advertising, as media buyers seek to achieve the lowest cost per acquisition. The main targeting tools have tended to be conventional media practices, such as capping the frequency of ad serving to unique visitors, or buying inventory more cheaply by accepting broader coverage.

"Part of the problem stems from advertisers' reluctance to test new targeting methodologies, and the ability to accurately assess their performance against standard methods," she says. Geographical targeting suffers from this in particular - the reliance on an IP address as an indicator of location is dangerous because it can make it appear that the right profile has been reached.

But, as Mike Teasdale, partner in agency Harvest Digital, says: "IP address is unreliable because of examples like Siemens, which uses one server to provide Internet access for the whole of its staff in Germany, so they always look like they are in Frankfurt; or Internet service providers like AOL, where all of the traffic goes through West Virginia into Europe." Any ad serving report which shows massive concentrations of traffic from such clusters needs to be treated with a great deal of caution. But with some of the most important sites on the Internet, such as Google, not requiring users to sign in at all, analogues for targeting like IP address are all there is.

But even registration sites need to be scrutinised carefully, since there is little validation of the data provided against offline reference sets. On some of the hottest Web properties, such as Facebook or MySpace, the nature of social networking means there is an inhibition against outright lying.

These sites are making it possible to undertake some remarkably precise marketing. According to Teasdale: "The police have approached one social network to target campaigns at specific gangs. They are hoping to persuade young people in certain areas to grass them up. That is micro-targeting."

For many media planners, the main profiling tool is derived from the comScore Media Metrix panel of Internet users, which gives a broad demographic indication. AOL subscribers are more likely to be over 35, whereas users of Lonely Planet are generally under 25, for example. Teasdale also believes that, with rising investment in online ads, efficiency naturally falls, which will create a push for tighter targeting.

One of the challenges around improving online ad targeting is the infrastructure involved. Virtually all ad content served via leading sites is stored on a third-party system, usually Double-Click or Atlas. For targeting to work, data needs to be associated with this content in realtime.

"MSN uses our Atlas Publisher, but not for behavioural targeting. Generally, what the technology is used for is optimisation towards cost per acquisition," says Damien Healy, operations director at Atlas Solutions.

Where behavioural targeting is applied, it is usually to target responders to ads who did not convert, so that they can be re-served with a promotional message once they return to a relevant website.

"That way, there is absolutely no wastage. You know they have previously been interested, they clicked through but didn't purchase. Perhaps they needed time to consider the offer, but they have shown interest, so it's important to target them again," says Healy.

The ability to track online behaviour in this way has been one of the most appealing aspects of digital advertising. It moves even pure brand awareness work towards the efficiencies of the direct response model. But behavioural targeting in the absence of geo- or sociodemographic targeting is still only relatively effective.

Online advertisers, publishers and media buyers conform to the Internet Advertising Bureau's code of practice on data privacy. While it is critical to establishing confidence around e-commerce and online media, it limits the ability to target. Significantly, Google has publicly stated that it will not use individual-level data for targeting, although MSN and Yahoo! have yet to make similar commitments.

"There is a clash between targeting and privacy," says Healy. "From the advertisers' point of view, they want to be as targeted as possible, and want to know that the person they are serving an ad to is exactly who they say they are. From the consumer side, it could be considered that their privacy is being compromised."

The recent furore over the release of a set of AOL subscriber data for research purposes is a case in point. Despite only providing IP addresses, inferred data from the searches being carried out allowed some individuals to be specifically identified. While the ad industry might well carry out such analyses behind the scenes, the public is not yet ready to accept the fact.

"A good example is MSN Messenger. At the foot, there is space for a button-sized ad. But some users have been complaining about the network selling their profile data," says Dax Hamman, international operations manager at Bluestreak, which provides an ad-serving platform to both advertisers, media buyers and publishers.

"The point at issue is whether publisher-side ad serving tools will be integrated with log-in to their websites. Third-party tools like ours purely track anonymous data. We know where somebody has clicked - the publisher knows their demographics," he says.

Auditing the way inventory has been delivered via a third-party service is an important check on just what publishers are doing with ad content. It is all too easy for an agreed volume of 100,000 ads to be served up without the right filters having been applied, meaning that 30,000 could have been seen by the wrong profile entirely. "The media owner will try to optimise inventory towards cost per 1,000. The media buyer is trying to optimise towards cost per acquisition. There is a middle ground between the two," argues Hamman. In the right context, geographical targeting is not only possible but acceptable to website users. A prime example is UpMyStreet.com, which over 1 million people visit every month to get information on their local or target area, using postcode or town name.

"We do match ads to profiles, and have done so for the last five years. We are probably the only website that can do very accurate geo-targeting campaigns," claims Mark Haupt, head of sales. He estimates that up to 20 per cent of advertisers are asking for some form of socio- or geographical targeting in this way.

One reason why UpMyStreet can apply targeting without a consumer backlash is that 70 per cent of users only enter geographical information to determine content, without formally registering. The site can then pull in Acorn profiles associated with the postcode. "Increasingly, advertisers have started to buy using Acorn groups. You would expect with the amount of information available that it would happen more often. But planning/buying online is at an early stage. It is up to us as media owners to promote it and tell people what to do," says Haupt. Until this happens, a gap is being left which some third-party service providers are looking to fill. Wunderloop has been set up to carry out exactly this kind of data matching to online behavioural profiles.

"At the moment, advertisers are still buying by type of site. For example, a car company will buy Topgear, AutoTrader and Parkes because that is where the buyers are. For me, that's not enough. If you find the clicking path and demographic of a potential buyer, once he comes back elsewhere on the network, you can serve him a car ad there," says Hamilton.

The wider adoption of tools that allow clickstream data to be associated with socio- and geodemographics is only a matter of time. The amount of money being spent through online advertising is simply too large, and growing too fast, to accept inefficiency. It is time for the talking about data to stop and the online action to start.

The Royal Society for the Protection of Birds is launching an email marketing campaign in a bid to recruit new members. The RSPB, Europe’s largest wildlife conservation charity, has selected online marketing agency Harvest Digital to manage the campaign following a three -way pitch, and appointed Bluestreak as the email marketing platform.

Harvest Digital has produced topical copy and engaging creative featuring stunning images of wild birds. With the strap line of ‘Saving birds, wildlife and the environment’, the first email emphasizes the effect of global warming on birds and wildlife and has a click through to the RSPB to join. The mailing also has news, including articles about RSPB reserves and helping garden birds to survive the winter, and an offer of fifteen months membership for the price of twelve.

Jo Coker, Direct Marketing Co-ordinator at the RSPB explains, “Signs the climate is changing are all around us - this year we have had one of the hottest summers on record. Erratic weather makes it even harder for many wild birds to survive. Birds are an important part of our ecosystem and a great indicator of the health of our planet so we need more supporting members to enable us to help them and their habitat. Email is an efficient way to reach potential supporters with a wealth of supporting information and a good offer. We selected Harvest Digital to manage the marketing because of their strategic direction and experience in the charity sector and Bluestreak because of their guidance on best practice, metrics and analysis.” Harvest Digital produced creative options, which were then split-tested by sending them to small segments of the database. Bluestreak monitored their performance for clicks, opens and the number of new members joining, and produced a custom report to decide on the most effective option. The email will be sent to the RSPB’s in-house database on the Bluestreak ionMX platform.

Mike Teasdale, Planning Director at Harvest Digital, comments, “We worked through a lot of potential email layouts as we wanted to maximize the amount of readable content that would display in the auto-preview pane. The test showed that the version with more content and a newsletter style generated more click-throughs, which validates our view of best practice of email design.”

Dax Hamman, International Operations Manager at Bluestreak comments, “We have tested the copy for spam-filtering and used our integrated ReturnPath tools to check the layout against 18 major email applications and ISPs to ensure the email is optimized for deliverability. Combined with the best creative from Harvest this will ensure higher open rates and click-throughs to sign ups.”

The roll out of email activity will commence this week.

Source: nma.co.uk Published: 11 January 2007 00:00

Full-service agency Harvest Digital and marketing technology company Bluestreak have jointly won the email advertising account for the Royal Society for the Protection of Birds. The win comes as the companies revealed they will work more closely in the future.

Harvest Digital won the strategy and creative part of the RSPB business following a three-way pitch, while Bluestreak scooped the technical email marketing side following a recommendation from Harvest Digital.

The first project for the agencies, which kicks off this week, is to create and implement an email marketing campaign to emphasise the effect of global warming on birds' activity.

"We'll be working closer with Harvest Digital this year," Dax Hamman, international operations manager at Bluestreak, said. "Between us, we share best practice on creative and technical techniques."

Mike Teasdale, planning director at Harvest, said, "We'll recommend Bluestreak on certain projects that are suited to it."

Five Must-Have New Year’s Resolutions for Email Marketers

By Dax Hamman, International Operations Manager, Bluestreak

(Technology Weekly - 9th January 2007)

The New Year is here and some of us might be thinking about our personal New Year’s Resolutions - maybe getting back to the gym, paying off our credit cards…But what about your business resolutions? More specifically, what about your digital marketing resolutions? When it comes to email marketing, there are a few clear areas where many marketers have room for improvement. As you develop your 2007 marketing plans, now is the right time to commit to a few important email marketing principles:

Collect and integrate all customer data. The breadth, depth and quality of your data are your largest drivers of success. You need to be on top of your email data collection – for example, are you collecting all your email registrations? Do you know when and where an address was added to your database? Are you capturing customer promotion history? Do you have data quality processes in place?

What about mining your data for relevant and actionable insights? For example, conducting a behavioural analysis of your file will tell you how your customers respond over time. Do you have tools and processes in place to derive such insights?

Finally, is your email database interconnected with other customer data sources like transactional databases, both online and offline, and market research databases? Can you act on insights gained from cross-referencing your integrated databases?

Review your engagement strategy. An effective and timely customer engagement strategy can improve your deliverability. If you wait even one week to engage after a customer subscribes to your email, you risk your customer forgetting their subscription and reporting your message as spam. So it’s important to evaluate whether you’re connecting with your customers at the right time. For example, do you send them an automated welcome message when they sign-up for your emails? Do you follow that message up with tips and recommendations based on their interests?

A strong engagement strategy is a great way to begin a triggered dialogue based on your behavioural analysis. A triggered message is an automatic messages based on customer events or actions. If there’s a significant withdrawal from your customer’s bank account, or unusual account activity, why not send them an account alert email? Better to be safe than sorry. Triggered messages represent a real-time dialogue with your customers based on specific events and can both serve to cement your relationship as well as generate important goodwill.

Try a new segmentation strategy based on customer behaviour. It’s important to classify customers into segments based on their expectations and behaviour, and then tailor your marketing to the different needs of these segments. For your frequent clickers, try offering free gifts with purchases; for the non-responder segment, discounts or free shipping might help lasso them in. What about all those shopping cart abandoners? Send them a timely remarketing message offering free shipping (high shipping charges is one of the most common reasons a shopper abandons their cart).

Run A/B tests to assess your creative. What could be more important than knowing if your email creative is working? Don’t be afraid to make changes; you won’t be tossing out your entire investment. Sometimes, very small adjustments can have a big impact on response rates. Bluestreak research shows that adjusting the delivery rates, subject line and/or from line can improve conversions up to 10 percent. However, adjusting the creative can improve conversions between 10 and 50 percent!

For example, do you know if your creative is optimised for image blocking? Some of the ISPs will block images on emails to protect their customers’ from unwanted large files. There are ways to repurpose the email so it still makes sense and looks attractive to the recipient if you have the right optimisation tools in place.

One client of ours wanted to convert its 30-day trial subscribers into full-time subscribers. Through an A/B test strategy of the creative (comparing performance of one draft creative against another), we introduced a new creative strategy which placed the offer at the top of the email in text format so it appeared in the preview pane and was not blocked by email applications. The results yielded a 41% lift in response rates and a lifetime value of over £150,000. Pretty good results from a relatively minor creative adjustment.

Leverage RSS to fight list fatigue. RSS is a web feed format used to publish frequently updated pages, such as blogs or news feeds, and push them out to users who opt-in for such information. Are your customers adopting this emerging channel? A recent Bluestreak study in the US: Emerging Digital Channels: Consumer Adoption, Attitudes & Behavior, showed that 28 percent of respondents are using RSS (Really Simple Syndication). 28 percent is a fairly healthy number for a relatively new platform. And with email list fatigue a growing problem – or the prevalence of inactive subscribers who no longer click on your emails - ask yourself how RSS can complement your email program. You might be able to reach customers bored with or overwhelmed by email on this exciting new channel.

Don’t listen to the hype, RSS adoption is not having a negative impact on email performance; these channels will co-exist. The question all marketers must ask is, “am I ready to respond to customers who want to connect with RSS?” I predict that 2007 will be a year of rapid adoption for RSS and marketers who have a strategy in place will win.

Overall, if you adopt these five New Year’s resolutions into your 2007 marketing plan, or even any number of them, I can almost guarantee you will make a profound impact on the success of your email marketing program.

Hey, maybe you’ll even have more time to visit the gym.