Are Signs of Behavioral Network Growth Real or Mere Illusion?

by , Aug 26, 2005, 1:30 PM
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The behavioral targeting network concept is gaining ground. Well, maybe. From the network side it looks that way, anyway. Announcements this week from Claria and Tacoda, at least, indicate that they see growth in their respective behavioral targeting (BT) ad network offerings.

Tacoda, what you might call a BT-veteran, unveiled new partnerships with Burst Media and Akamai. Burst will be providing customized ad serving and inventory management technology for use in a large-scale network environment. And Akamai's EdgeSuite technology will apparently bolster Tacoda's network response time capabilities and broaden its geographic reach. From the looks of it, Tacoda's getting a system tune-up in preparation for its race down the road to network success. Or could that be wishful thinking? Claria, too, appears to be making or at least anticipating strides in the BT arena. The firm, which has been touting its new Internet-wide BehaviorLink behaviorally-targeted ad network for months, has done some exec shifting of late. Not only has Claria taken on a new president and CEO, it's hired on ex-Overture sales exec, Jason Fairchild, as its new vice president of business development. These are moves obviously intended to facilitate the company's new focus on BT and content personalization. Who knows? They just might indicate that this whole behavioral network thing is taking off for Claria, too.

But I wouldn't be so quick to judge. As even online ad industry newcomers know, Claria has long been the bête noire of online publishers that don't especially appreciate the company's habit of serving pop-up ads over their own site content and ads. Could the fact that a former Overture exec has aligned with Claria indicate that the ol' Gator bite wounds are healing? (Yahoo!, after all, which offers behavioral targeting, owns Overture.) We shall see....

The fact is, while advertisers have complained that publisher-side BT products don't offer enough reach to make them truly worthwhile as a full-scale online ad strategy, advertisers haven't exactly embraced the network solution, either. For one thing, advertisers are leery of blindly placing their precious brand images alongside just any old content. They're used to choosing which ads go where, and the promise of targeting ads based on users' online interactions, while enticing, doesn't necessarily make up for the fact that they have less or no control over what sites their ads run on. However, the drudgery of buying BT ads on a site-by-site basis, and the lack of reach enabled by going that publisher-side route, makes for a media-buying catch-22.

And let's not forget the publishers. Don't be so sure they're chomping at the BT bit either. Not only do many still feel the Claria/Gator sting, the whole BT network notion, while helping them profit from otherwise less-desirable inventory, has its downsides. The fact is, publishers have their own brands to protect. By plunging into a sea of nameless network sites, they lose the valuable cachet of their unique content, as well as the ability to segment audiences in a distinctive manner. Privacy concerns, especially in this era of increasing anti-cookie hype, are another deterrent. And the potential for compounding their already unpredictable inventory management messes isn't attractive, either.

Of course, it's easy for publishers to say they'll steer clear of Claria's network -- or Tacoda's, or any other behavioral network for that matter - without easily being found out, since these networks keep the names of their publisher partners very close to the virtual vest. Claria's BehaviorLink site, for instance, merely states that its "network is made up of quality publisher Web sites." This allows "quality publishers" to earn more for their otherwise bargain basement-priced remnant inventory while maintaining their prestige as sites that would never hobnob with the riffraff (that is, unworthy partner sites or advertisers), as it might lower their status as premium media.

So, advertisers may be getting their reach and publishers may be getting their higher CPMs. The question is, will they want what they asked for?

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