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At last, the era of
behavioral targeting


Study reports more advertisers are trying it

Jun 27, 2006

It's one of those smart internet ideas that's been surprisingly slow to catch on: behavioral targeting. It's where the advertiser places the message in the path of the user, based on the user's past behavior. That's opposed to traditional targeting, where the ad is placed against content the advertiser assumes the user will be interested in.

But at last behavioral targeting is showing real acceptance among advertisers. A new study reports that nearly one in four online advertisers, 23 percent, plan to use behavior targeting in 2007, up from 14 percent this past year.

"Advertisers are starting to embrace behavioral targeting," says Emily Riley, advertising and marketing analyst at JupiterResearch, which conducted the study. "For some it is just another tool in the tool box. But for others, particularly advertisers with long purchase cycles, it can really be an important tool."

That may well be because of the results it delivers. Jupiter's researchers found that 88 percent of agencies that used behavioral targeting in the last 12 months were somewhat to very satisfied with the effectiveness of the campaigns. That's compared to 56 percent of agencies that relied on traditional targeting methods.

Behavioral targeting, which relies on sophisticated tracking technology, is still only offered by a handful of companies. Among those offering the service are Tacoda Systems and Revenue Science. There are also companies, such as Yahoo, that offer aspects of the service across their own properties.

In effect, there are two basic types of behavioral targeting, known as extended-content targeting and purchase-intent targeting.

Extended content targets users who have shown an interest in a subject, say flyfishing or golf, by placing the advertiser's message, say for a new, light-weight reel or a putter, when the user has moved on to new content, even unrelated content, as Riley explains.

So, for example, through the behavior software we know that someone has read at least three golf articles in the last month. The putter-maker can then arrange to place his or her ad against whatever new content our golf fan pulls up, whether it be about golf or investment banking or the weather, for that matter.

The advantages are pretty obvious. The advertiser is reaching consumers known to be interested as opposed to consumers who he has reason to think may be interested, which should produce higher results at less cost. Extended content is generally used for branding.

The other form of behavioral targeting, purchase-intent targeting, allows advertisers to direct their messages at users who are about to make a purchase. For instance, someone that has been researching convertibles on an auto site could be targeted with relevant advertising when they are elsewhere on the internet.

"Purchase-intent targeting pinpoints someone that is about to buy something, not just someone that is interested in a particular subject matter. So for advertisers that is like magic," says Riley.

Jupiter's study found that in 2007 behavioral targeting will close in on content targeting and demographic targeting, the two traditional targeting methods. Content targeting will be used by 25 percent of advertisers next year, while 28 percent will target by demographic. That’s not far ahead of the 23 percent of advertisers that intend to use behavioral targeting.

Riley credits the change to the increasing sophistication of the tracking technologies and advertisers' increasing faith in their reliability. Behavioral targeting is expected to see its biggest gains among advertisers of products with long purchase cycles, such as cars, supplanting traditional content targeting in the next 12 months.

Meanwhile, in online ratings for the week ended June 18, Microsoft was the top parent company, followed by Yahoo, Time Warner, Google and News Corp., according to Nielsen//NetRatings. Top brands were Yahoo, Google, Microsoft, MSN and AOL.

GUS Plc once again retained the top spot among advertisers, delivering 5.27 million impressions to No. 2 Vonage’s 3.74 million. Yahoo served up the most ads, 18.96 million, followed by MySpace at 7.37 million.

Sessions per person averaged 16, and domains visited per person were at 37, with the average PC time per person at 16 hours, 5 minutes and 5 seconds for the week.

 

Top 25 parent companies
Through June 18

#

Parent

Unique Audience (000)

Reach %

Time spent per person (hh:mm:ss)

1

Microsoft

81,122

61.0

0:41:06

2

Yahoo!

74,056

55.7

1:09:34

3

Time Warner

69,521

52.3

1:38:13

4

Google

63,333

47.6

0:20:10

5

News Corp. Online

33,621

25.3

0:43:59

6

eBay

32,539

24.5

0:42:20

7

InterActiveCorp

27,684

20.8

0:13:20

8

Amazon

20,629

15.5

0:11:49

9

RealNetworks, Inc.

19,850

14.9

0:21:08

10

Landmark Communications

19,224

14.5

0:23:44

11

Walt Disney Internet Group

17,742

13.3

0:25:36

12

Apple Computer

17,625

13.3

0:30:40

13

New York Times Company

15,357

11.5

0:07:31

14

United Online

13,938

10.5

0:28:55

15

Verizon Communications

12,490

9.4

0:14:35

16

Bank of America

11,800

8.9

0:24:22

17

AT&T Inc.

11,145

8.4

0:17:50

18

CNET Networks

10,393

7.8

0:07:24

19

E.W. Scripps Company

10,109

7.6

0:07:42

20

Wikipedia

10,001

7.5

0:09:33

21

Gannett

9,675

7.3

0:08:53

22

Viacom

9,129

6.9

0:31:36

23

Comcast Corp.

8,404

6.3

0:25:16

24

EarthLink

8,376

6.3

0:32:52

25

Wal-Mart Stores

7,875

5.9

0:07:56

Source: Nielsen//NetRatings

 

Top 25 brands
Through June 18

 

Parent

Unique Audience (000)

Reach %

Time spent per person (hh:mm:ss)

1

Yahoo!

73,342

55.1

1:10:00

2

Google

62,068

46.7

0:19:40

3

MSN

62,063

46.7

0:37:50

4

Microsoft

60,899

45.8

0:16:09

5

AOL

48,777

36.7

2:07:23

6

eBay

28,616

21.5

0:43:06

7

MySpace

24,166

18.2

0:53:45

8

Real Network

19,812

14.9

0:21:11

9

Weather Channel

18,382

13.8

0:24:35

10

Apple

17,625

13.3

0:30:40

11

MapQuest

17,319

13.0

0:07:04

12

Ask Search Network

16,766

12.6

0:14:23

13

Amazon

16,678

12.5

0:11:22

14

About.com

10,390

7.8

0:03:11

15

CNN

9,993

7.5

0:18:48

16

Wikipedia

9,913

7.5

0:09:21

17

Bank of America

9,590

7.2

0:27:37

18

Blogger

7,611

5.7

0:07:24

19

ESPN

7,488

5.6

0:27:02

20

Comcast

7,353

5.5

0:27:42

21

Disney Online

7,332

5.5

0:30:38

22

Lycos Network

7,159

5.4

0:03:06

23

EarthLink

7,041

5.3

0:34:36

24

PayPal

6,947

5.2

0:11:53

25

IMDb - Internet Movie Database

6,940

5.2

0:07:45

Source: Nielsen//NetRatings

 

Top 25 advertisers 
(excludes house ads)
Through June 18

#

Company

Impressions (000)

1

GUS Plc

5,273,916

2

Vonage Holdings Corp

3,740,748

3

NexTag, Inc.

2,476,671

4

Reunion.com L.L.C.

1,421,792

5

Netflix, Inc.

1,394,841

6

United Online, Inc.

1,294,741

7

Verizon Communications, Inc.

1,109,417

8

Time Warner Inc.

1,060,487

9

Echostar Communications Corporation

1,025,934

10

YourGiftCards.com

996,545

11

HSBC Holdings plc

817,498

12

Skype Technologies S.A.

659,383

13

E*TRADE FINANCIAL Corp.

653,990

14

Monster Worldwide, Inc.

584,485

15

Low Rate Source

571,124

16

Bank of America Corporation

477,800

17

Providian Financial Corporation

451,856

18

eBay, Inc.

443,042

19

OnlineRewardCenter

442,066

20

Microsoft Corporation

354,159

21

Scottrade, Inc.

339,595

22

InterActiveCorp

321,600

23

TD Ameritrade Holding Corporation

321,104

24

American InterContinental University

304,696

25

General Motors Corporation

303,416

Source: Nielsen//NetRatings AdRelevance

 

Top 25 advertising sites
(excludes house ads)
Through June 18

 

Company

Impressions (000)

1

Yahoo!

18,955,938

2

MySpace

7,371,082

3

MSN

4,734,094

4

eBay

1,018,062

5

Juno

638,113

6

AOL.com

569,170

7

NetZero

400,249

8

The Weather Channel

399,680

9

iWon

343,267

10

Excite

277,116

11

New York Times

266,207

12

CNN

262,136

13

MSNBC

230,691

14

Pogo

229,372

15

IMDb

211,323

16

EarthLink

195,905

17

FOXNEWS.COM

190,804

18

About.com

185,595

19

Realtor.com

173,855

20

ESPN.com

164,802

21

Drudge Report

163,168

22

MarketWatch

143,838

23

Forbes

141,441

24

SmartMoney

141,145

25

FOX Sports on MSN

137,532

Source: Nielsen//NetRatings AdRelevance

 

Average use
Through June 18

 

 

Current Week

Last Week

% Change

 

Sessions/Visits per Person

16

n/a

n/a

 

Domains Visited per Person

37

n/a

n/a

 

PC Time per Person

16:05:05

n/a

n/a

 

Active Digital Media Universe

133,022,074

133,579,420

-0.42

 

Current Digital Media Universe Estimate

208,156,713

208,194,530

-0.02

Source: Nielsen//Net Ratings AdRelevance

 



Heidi Dawley is a staff writer for Media Life.




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