• by Kate Kaye , February 3, 2006

Are Americans too concerned with Web privacy issues? Could the virtual world of games be a testing territory for emerging advertising techniques and technologies? Ilya Vedrashko thinks so. The Massachusetts Institute of Technology graduate student moved here from Russia to study all things media and advertising at MIT's Comparative Media Studies Program. Behavioral Insider chatted with Vedrashko about improvements he'd like to see in ad targeting, and other issues affecting behavioral marketers and advertisers in general.

Behavioral Insider: What online technology related concepts are you studying right now?

Vedrashko: My thesis is on advertising in computer games. And it's a really broad topic because it includes everything from advergaming, online gaming, to the dynamic serving of advertising in already-existing properties. I think there is a lot of room for improvement because it's a very new area.

 BI: Do you have ideas for behavioral targeting that you're not seeing implemented?

Vedrashko: One thing I don't see anybody looking at is so-called "cluster visits." I'm sure somebody has built this out, but I haven't seen a discussion [about this] yet. When you go online each morning, how many Web sites do you visit consistently? It's probably no more than a dozen. So, for me it would probably be CNN, The Drudge Report, the news sites I visit every day. The way to serve advertising would be to look at these clusters and serve advertising on Drudge Report, after [I] visit CNN, that would enhance the experience that [I] got from CNN's advertising. So, for example, if CNN serves an ad for a car, then The Drudge Report would know [I've] already seen this ad and they would serve the ad for the same car but with a different twist, knowing my prior behavior.

BI: How do you foresee companies enabling that, without having, say, those two Web sites--The Drudge Report and CNN--within the same ad network?

Vedrashko: Every Webmaster already has all the information necessary to make some sort of decision. The problem is this information is not being shared across the board. So, The Drudge Report knows its own statistics but it doesn't know CNN's.

BI: But what's the incentive for Drudge Report to share their information? Most of these sites are really proprietary and they don't want to share their information with anybody, and that's definitely something that behavioral targeting technology companies have been up against.

Vedrashko: Maybe the pricing model changes, and advertisers realize they don't have to pay for meaningless, wasted impressions; they really want to pay for targeted impressions. That would put pressure on the publishers to start cooperating.

BI: When you talk about online advertising-related issues or things related to behavioral targeting [with other students], what kinds of things come up? Are you talking about privacy issues?

Vedrashko: The privacy concern is one of the biggest issues that's being discussed, not only in our department, but in the academic community. The general take is that privacy should be respected and you shouldn't really spy on people. My personal opinion would be probably different. I come from a different culture. I'm not terribly concerned about people looking at what I do online because it's not terribly interesting to anybody else but me.

BI: Do you think attitudes are different around the world when it comes to these sorts of privacy issues?

Vedrashko: I think so, definitely.

BI: And it's a cultural thing, what people are used to in their society? Obviously, Russia has a history of not necessarily allowing too much privacy.

Vedrashko: I think that's definitely a factor. Maybe the world is moving to the lowest common denominator - or the highest common denominator in terms of privacy as democracy marches on. But I'd be surprised if privacy concerns in Russiawould have the same kind of priority that they have here.

BI: In an e-mail to me, you wrote that "behavioral and contextual marketing are the future of advertising not only online, but in all other media where technology permits advertisers to collect and analyze user data and adjust the campaign according to the results." Can you elaborate on that?

Vedrashko: The general feeling is that advertising is a necessary evil, but I think advertising serves a very important purpose. In many cases people like advertising and people rely on advertising; the most obvious example is the yellow pages....The problem with advertising is that it is served in such a way that it doesn't deliver the value that the user expects it to deliver. If advertising could be served in the right fashion at the right time, many of the problems that we're experiencing would be solved, including ad skipping.

BI: What are you working on right now that you think is the next trend or an important development?

Vedrashko: Game advertising is a very new approach. Most of the companies that serve the market have appeared in the last two years. So now they're standing in front of this world; it really mirrors our own, only it doesn't have any advertising. So, advertisers right now have this clean slate. The biggest concern right now is that we're given a second chance to do things right. So, what I'm concerned with is for advertisers to do things right--that they don't ruin this next world with advertising that just sits there and does nothing.

The real world has so many imperfections, and the virtual world gives many more opportunities for doing things right, and the costs are much lower for doing things right. They should really be examining the mistakes that have been done here and make sure they don't happen [in the virtual world].

Contextual and behavioral advertising would be much easier to do in the virtual world than it is here in the real world....Even if you place a billboard in the real world, it's really expensive to measure how many people see it and how many people act on it. In the virtual world, you can also place a billboard which would look exactly like it would here on Massachusetts Avenue here in Boston. But in the virtual world there are many more, much cheaper techniques to measure the exposure.

I think in this sense, the virtual world can also be a great testing ground for the new advertising approach that then can be imported into the real world.