Customers Getting Comfy With Targeting

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Business looks bright for Criteo, which provides personalized ad retargeting for brands like Zappos and B & H in the U.S. and Boden in Europe. The company announced Wednesday U.S. e-commerce sales increased tenfold in Q2 2010, sequentially. JB Rudelle, the company's chief executive officer and co-founder, attributes the growth to relocating the headquarters from Paris to Palo Alto, Calif., an increase in clients, and impressive click-through rates.

In Q2 2010, Criteo's U.S. client base doubled, ad impressions rose more than 230%, clicks resulting from its platform increased nearly 400%, and number of sales generated post-click increased more than 600%.

Criteo works with 500 brands worldwide, providing personalized retargeting technology on a pay-per-click (PPC) basis to drive consumers from destinations across the Web back to advertisers' sites.

Fashion retailer Boden partnered with Criteo to support its search engine marketing campaigns and boost sales through retargeting display ads. The messages personalized for each Web site visitor on-the-fly feature up to 10 product images based on what the consumer previously browsed on Boden's site. It took two days to implement the technology and, according to Criteo, immediately begin delivering relevant ads to pre-qualified online shoppers.

The results produced a 9% conversion rate, more than triple the fashion industry average, according to Criteo. The personalized display banner ads generated nearly a quarter of a million clicks in 10 months. It also produced a cost-of-sale less than 5%, which is one-third the industry benchmark, says Criteo. Since then, Boden rolled out Criteo across international Web sites.

Companies have begun to add retargeting to their media ad budget because consumers are becoming more comfortable with targeted ads, Rudelle says. "Some retailers are spending up to 80% of their budget on search," he says. "They see that adding a CPC retargeting model helps bring consumers back to their Web sites, as customer feel more comfortable about seeing personalized targeted and retargeted ads."

Acceptance of retargeting from brands and consumers should continue to fuel Criteo's business. Released last week, a study from PreferenceCentral suggests the consumer attitude toward targeted ads continues to change. The study finds consumers are more likely to prefer targeted online ads when they are asked to make value-for-value trade-offs such as free access to Internet content. The research also shows attitudes and preferences significantly shift when consumers are provided with education about behavioral targeting or when they are offered the ability to control targeted ad exposure.

Certain factors play a role in comfort levels. Twenty-nine percent of respondents were less comfortable with the trade-off of free content for targeted ads until they were told the data remains anonymous and non-personally identifiable. Then 35% of consumers became more comfortable.

When consumers were presented with an option giving them more control of exposure to targeted ads and transparency into the data used by advertisers, 70% expressed interest in using the tools, 33% indicated they were interested, 41% became more comfortable and 27% were more willing to receive targeted ads.

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