• by Will Margiloff , May 3, 2007

The main theme of the recent AAAA CEO Conference was clear: “Digitize or die.”  For an Internet-only guy in a room full of traditional agency folks, this was a thunderous validation for all who have stayed the course.  With so much to choose from and consumers now controlling what they want and when they want it, how do we continue to build upon the foundation that has grown faster than any other media to date? What will the future look like as we move into the second era of Web marketing?

Auction-based media.  More publishers and advertisers are placing their trust in a system that matches inventory with advertisers and yields the best results for both -- extending well beyond text-based search.  With the rise of Right Media, Google Display, and the recently announced but yet to be launched DoubleClick exchange, it is apparent that we will someday see a fair majority of non-homepage, nonsponsorship inventory delivered by systems that operate under this principle.  While this isn’t going to happen this year, over time auction-based display will be a reality that will help marry the most appropriate ads with the most effective inventory on high-quality as well as niche community sites.  Yet we still have a long way to go to improve the quality available and to be able to effectively buy across multiple networks in a centralized location. 

Behavioral targeting/remarketing. BT and remarketing are also exciting new developments that combine technology and marketing knowledge to deliver more relevant advertisements based on the surfing behavior of a user.  Users can be remarketed to at a future date after they have visited a site either from a display or text-based ad.  Cookies allow you to see the user at a later time and deliver an advertisement based on previous behavior, whether the profile was based on surfing or on a previous individual act like a missed sale opportunity.  Tacoda and Revenue Science provide services that focus on both and have built a quality publisher network to leverage.

In-text contextual advertising. One of the most interesting developments involves contextually relevant text ads.  Paid search is already a proven effective marketing tool, so advertisers should focus a good percentage of their spend on search on the big engines.  Another natural extension of search is in-text ads that allow you to buy keywords phrases that are imbedded within contextually relevant content.  These highlighted and clickable links allow for the delivery of highly contextual opportunities that include video and rich media, which are proving to be very successful complements to paid search.  Players in this vertical include Miva, Vibrant Media, and Kontera. 

It requires a little guesswork to tell  what’s next. What is clear is that we need to innovate.  Digitize or die; innovate or be ignored.