In 2006, Greg Stuart, Interactive Advertising Bureau CEO, estimated
that advertisers’ waste, that is, impressions reaching the wrong
audience or none at all, was $112 billion a year in America and $220
billion worldwide, or just over half of their total spending. Wanamaker
was remarkably accurate.
In 2009, we have made little progress. A recent research from
ComScore indicates that only a small minority of campaigns reach their
intended audience with the desired frequency. Of eight U.S. brand
campaigns with budgets between $400,000 and $2 million, ComScore said
none reached more than 20 percent of their target with a frequency of
four impressions or less. Up to 80 percent of the impressions were
delivered either to the wrong segments in the U.S., or to consumers
outside the U.S.
A number of factors are to blame for this situation:
1. Reaching audiences based on context is expensive and not
particularly effective. Yet, media planners and media buyers are only
trained to buy audiences based on the media they consume. It takes a
fair amount of interpretation and mapping to turn the target audience
defined in a creative brief into a robust media plan. Emerging
technologies enabling multi-party cookie synching, real-time
decisioning, real-time bidders, and media de-risking with new classes
of publishers and ad networks, provide effective means to buy the right
audiences directly instead of guessing the web properties they might
visit.
2. A lack of standards in audience
targeting creates a real challenge for media planners when it comes to
selecting ad networks or data exchanges to work with. At the surface,
they all sell the same segments, but they all have access to different
data, at different scale, and follow different approaches to aggregate
or compute segments. Testing audience segments across many inventory
and data providers can be overwhelming and media buyers end-up buying
from the same sources they always buy from.
3. Many media agencies are still in the Stone Age when it comes to
digital media execution. They are not to blame as much of the
technology innovation of the past five years was focused on the
publishers. The lack of automated tools makes it hard for media
planners to create many mini-media buys optimized for a more granular
and more precise set of audience segments. As a result, media planners
will typically focus on larger, less accurate media buys that can be
executed quickly and with no hassle from a limited, but known, set of
inventory providers.
4. A campaign is often like a house of cards relying on proprietary
code to synchronize message passing between all parties involved. The
lack of standards in ad operations makes it hard to coordinate data
collection and media buying flows across the complex network of
publishers, networks, exchanges, and data providers. The proper
orchestration between retargeting pixels, ad tags, user pixels,
third-party tracking beacons, and click redirects can be daunting. A
single error can have dramatic implications on the ability for a
campaign to reach its desired audience.
5. Trafficking errors are introduced throughout the value chain,
either advertently or inadvertently, especially when ad networks sub
out media buys to other ad networks, a common practice. In such cases,
even when a problem is fixed somewhere, the fix is not passed along to
downstream networks and publishers. Campaigns explicitly targeting
users in the U.S. may see 5 to 20% of their impressions outside the
U.S.
6. Many data providers only offer a limited view of the user. In a
recent campaign targeting home-based business users with children, we
had to combine micro-business users, home-based users, and households
with children from three separate data providers. Scaling audiences can
be particularly difficult without the proper infrastructure to
normalize, aggregate, and store audience profiles across providers.
7. User cookies are misleading. A cookie is unique to a computer,
not a person. The information stored in a cookie typically aggregates
behavioral clues from multiple users of different gender, age, and
interests. Some data providers claim to support cookie-level targeting
when, in fact, the data stored in the cookie relies on, sometimes
dubious, transformations such as IP-to-zip code mapping or mass
inferences from small panels. The key to this challenge is to
triangulate and leverage data across multiple sources, in near
real-time.
8. Hitting the same user 20 times in the same week is like hitting the wrong user. In his recent post on iMedia Connection,
Michael Estrin quotes Guy Schueller, media director for Organic saying
“The sheer number of networks and subsequent overlap of inventory has
created frequency issues and, at times, confusion.” Many campaigns end
up recycling the same pool of targeted users across their data and
inventory providers. Without real-time visibility on users reached and
inventory overlap, agencies are unable to manage frequency capping
waste and prioritize spend toward the most efficient providers.
9. On target audience does not mean the right audience. Most
publishers and ad networks provide little visibility over data and
optimization techniques, making it difficult for media buyers to
understand the hidden characteristics of performing audiences that
offer new branding opportunities or better direct response performance.
10. Little control to optimize in real time. The media mix of most
campaigns is only optimized once or twice through their flight, at best
weekly. Advertisers have little control to optimize the audience
reached by their campaign. As media buying becomes more transparent,
more efficient and real time, it will be possible to modify media
buying and audience targeting strategies dynamically, optimizing not
just against a set of audience segments, but against frequency, day
parts, context, and messaging.
The real-time media buying, audience management and campaign
optimization capabilities of emerging demand platforms finally give a
voice to the advertiser where previously the whole ecosystem was
dominated by ad networks and publishers. Those platforms promise
greater accuracy, scale, and efficiency to reach the right audience
with enough transparency and control to let the buyer decide when, how,
and at what price to do it.
Article originally posted on AdExchanger.com.
