• by Michelle , Saar Safra , June 20, 2005

I usually like to concentrate on rich media (RM) in my articles, but in this one I will focus on something completely new that, next to RM, looks passé. There are a lot of Web advertising formats, a lot of different and diverse media, and most of all, a lot of different ways to achieve the same goal. A marketer can chose from a wide spectrum of advertising possibilities, especially on the Web where creativity is, in essence, unlimited.

To build my case, I will approach Web advertising from a different angle and demonstrate how one can take today's high interaction and conversion rates and multiply them, without adding much, if any, incremental cost. All advertisers need to do is simply better utilize existing tools and use them in the right order. In order to help better visualize my thoughts, I will describe advertising in layers, and the more layers we have, the higher the pile goes, the better it is for us, and the more we get for (and from) our advertising dollars.

The first layer is obviously the media. At this stage, we usually pick relevant media, publishers who have sold us the dream of the "targeted media." This sometimes works, especially in niche sites and portals with dedicated niche areas; sometimes it is just a dream. Targeting the right audience in these cases is vague, but still exists.

The next layer is the ad. Up to this point, we can get to a certain level of conversion rates, but if we hit a click-through rate of 0.5 percent or a conversion rate of 0.1 percent, we should feel as though we screwed the system, and it would be true. To bump the numbers a notch, we can start going wild and add the RM layer. Just by adding interactive Flash (forms, sound, motion) to the ads, we substantially increase the interactivity of the ad, the conversion rates jump, and the general level of interest by surfers is raised. Take that and add expanding or floating ads, and you are on the edge of Web advertising. This type of advertising will yield the best results by all means and is the most cost-effective, result-driven way of advertising online today. There are other features that can be added to that mélange, but they all revolve around the same ideas: increase the interactivity of ads to capture attention. We tend to think we really can't get the pile any taller, but there are still ways to "raise" the ceiling.

I am talking about the explosive cocktail of scalability and user targeting, and how we can benefit from it. Not too long ago I had a nice meeting with a sharp colleague and I have to admit, he left me stunned. Let me share with you some of the secrets he shared with me.

Believe it or not, there are companies out there that serve 3 to 4 billion ads a day (on average) and with such amazing amounts of information gathered every day, users can be targeted by advertisers almost surgically. There are different methodologies to target users, but to simplify things, I will only mention the two most interesting ones: situational targeting and behavioral targeting.

Situational targeting can include parameters from geographical information, through time of day and up to the users' screen resolution. Anything that does not relate to the user's previous behavior can be categorized as situational targeting, and users can be targeted respectively. However, the thing that made me choke on my lunch was when I began learning about the behavioral targeting piece.

To summarize it, I will give a short self-explanatory example that says it all. Imagine a brand name company that has substantial Web presence. This brand name company can track any user activity within their Web properties -- from the minute a user logs in, through the user's interests and up to the user's activities (acquisitions, questions, shopping carts etc.). Once that happens, by using common Web technologies, that brand name company can actually track their users until they return to any of the company's sites. So far, so good. But, the real deal is if that company could have targeted their users through their Web ads, not necessarily on their site, but all around the Web. So, if one of their users bumps into one of their ads anywhere on the Web, that ad would recognize the user and present it a different, targeted, almost personalized message from that brand name company.

This would obviously increase a user's interest level and substantially increase conversions. It is even more relevant when it comes to expensive media (such as RM and video) because just by targeting the right ad to the right user, it could increase conversion rates for the same media costs, and like I always say, get more for their advertising dollars.

This is the unique and sacred juncture between scale, formats (RM, video, etc.), and targeting capabilities. There are some companies, such as EyeBlaster and TangoZebra that already deploy situational targeting, but the bar should be higher: behavioral targeting on a large-scale. That's the challenge, and from what I hear, there are several initiatives in the market around this. More to come....