Less Is Enough

by Steve Smith, Oct 19, 2007, 1:30 PM

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How many behavioral segments can most publishers really service with any reasonable scale? That is the question Advertising.com subsidiary ADTECH US tries to answer with its upcoming release of behavioral targeting capabilities for ad service partners. Serving most of AOL's non-U.S. ads, Sky TV, the FOTOLOG photo blogging community and many others, ADTECH just opened its U.S. offices a year ago. This week, the company announced it was adding video and mobile ad serving as well as behavioral tracking and segmentation to its mix of offerings to publishers. Nils Winkler, managing director, senior vice president of sales, U.S., estimates that if a PC is active online, the odds are it has an ADTECH cookie on board that the company can leverage for BT profiling. Still, as he tells us this week, most publishers he services simply do not have the traffic scale or the sales infrastructure to support the kind of granular segmentation that tracking technology makes possible.

Behavioral Insider: As an ad serving solution you are not selling ad space yourself.

Nils Winkler: Our customers could be networks, they could be publishers or media buyers -- and we provide the technology solutions of them to enable them to get most of their money.

Behavioral Insider: What is ADTECH's reach and audience size?

Winkler: We don't really know our audience size because we're split into our various customer networks. We think that on every computer with an active Internet user we have an active cookie.

Behavioral Insider: How was your behavioral solution developed and differentiated from the pack?

Winkler: Most solutions today that are purely behavioral solutions are very much content driven, and the seller segments everything too much. If you segment too much you don't have anything left you can sell. So what we do is segment in standard categories like sports and baseball, which can be easily used across all the Web sites, publishers, and networks we are serving. And we apply our category to the appropriate campaign.

Behavioral Insider: What is different about this from the others in the market?

Winkler: It's much easier to use. It's more straightforward. No technical setup is necessary because it is part of our ad serving solution and our customers can just activate it. For the media seller, it is by far powerful enough. We don't need to have 1,500 different categories, because nobody can sell that.

Behavioral Insider: How many categories will you have?

Winkler: In the region of 50. We have standard categories. If our customers want to have individual ones, they can extend it.

Behavioral Insider: How would they do that if the system is based on a general set of categories? How would a publisher go more granular than baseball into a Yankees reader segment?

Winkler: Then they would need to know which tag to use. They use us for ad serving already and they have all our tags on their Web sites already. They need to go in and say, this page is directed toward Yankees fans. That is the only thing they need to do, which can be done easily and can be uploaded. IT departments are at no point involved, which for media companies makes things a little bit smoother.

Behavioral Insider: Why are 50 categories the right limit?

Winkler: There are very few organizations with enough inventory to justify having more categories. If you look how the sales teams are set up, there are not enough resources to handle those tiny bits and pieces, and the CPMs in many cases are not high enough to justify selling less. People want to have behavioral capabilities, but it needs to make economic sense. We have the feeling that what we offer is exactly what the market needs, not too little, not too much. There is of course more we can add, like making it more precise if we find out in half a year's time that we need to extend it to 100 categories. But we do not want to go into something that is far beyond what people actually use.

Behavioral Insider: Who manages individual publishers' data?  

Winkler: Every publisher is responsible for his own network for many, many reason. We don't interfere with that or get involved with media sales at all. But if the publisher opts to share anonymous data we gather from their Web site with other publisher customers of ours, they utilize that enormous reach across all the customer networks. This basically means that we could utilize every single cookie we have out there, and that means theoretically we have the biggest behavioral network in the world. That is, of course, dependent on how many publishers take that option.

Behavioral Insider: What do the publishers have to gain by sharing the data?

Winkler: We charge a little bit lower price to make it more attractive for more people.

Behavioral Insider: And they would gain the insight on incoming users from other publishers of yours.

Winkler: Correct. They wouldn't know that a user has been on a specific Web site, but they would know it is a user who has a high score of being, say, baseball-interested.

Behavioral Insider: Is this technology applicable to the video and mobile capabilities you also are adding?

Winkler: As soon as the integration for those portions is completed, I would say for the video definitely right from the beginning. For the mobile I would be more careful because that technology is slightly different and more dependent on network providers than display ad serving. But, yes the goal is to have the same functionality of display ads also for other media channels.

Behavioral Insider: How does this technology work with and compare to other BT networks?

Winkler: If you compare it to Revenue Science or Tacoda, for instance, what we do doesn't go as far. With those companies you can also use it to analyze your content. The biggest benefit, because you can drill so deep into data, is as much on the analysis side as the media sales side. What we have is more dedicated solution for the online media sales team and the ad serving tied together. If our customers choose to work with any other BT system out there we have no problem. We do that today. There is no limitation at all.

Behavioral Insider: When do you expect it to be rolled out?

Winkler: In Europe it is being launched already. In the U.S. it will be in the next update within the next few weeks.

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