I like recessions because they sharpen the focus of what’s in front of us and demand that we look at business in new ways. I’m also a big fan of data-driven advertising. I believe, in my delusions, that I’m actually one of its earliest and best practitioners, having been one of the few database directors to ever share an office with a creative director and live to tell the tale. The results we achieved were the ability to improve yield by 100%-200% by applying what now seem to be relatively rudimentary techniques to improve circulation.
So, I enjoyed reading Ashu Garg’s blog on Data-Driven Display Media (Display 3.0). However, the real data I’m seeing through our Trueffect ad platform challenges at its core some of the established folklore of online media. It turns on its side some of the metrics the industry uses, and creates through its disruption, a new set of standards. To understand this, the first thing I need you to do is put aside the fixation with trash-to-treasure stories of taking some inventory or data, fusing it together and voila – you now have inventory that matches high quality contextual media. As the head of Procter and Gamble recently said, "what makes you think this is media?" The second fixation I would lay to rest is that display is a broadcast medium. Again, we’ve nurtured a generation of interactive media personnel who think ‘reach’ not ‘relationship,’ ’impressions’ not ‘circulation.’ To paraphrase Ogilvy, they’re dependent upon data "Like drunks to a lamppost, for support not illumination."
What’s being measured in the current model is flawed because it doesn’t comprehend the number one driver of response – relationship. That's why I think Ashu has it half right. Advertisers need to use their data, but it’s the way they’re using it that needs tuning. Current industry practices associate pixels across domains, which is not only counter to the spirit of the domain security policies, but also being lambasted by the FTC in their Self-regulatory Principles. Any good circ planner knows that to do data-driven advertising, you need to stratify circulation across 5 key dimensions – audience, timing, offer, creative, and context. When you do this, it lays out perfectly to revenue. Fourteen percent of users generate 63% of sales.
Display 3.0 can do this, not by increasing the media vendor pool, but by changing the way the advertiser engages with the consumer at the time an ad is being served. The only way to do this is to alter the characteristics of the ad server, which neither Google, Microsoft, nor emerging vendors have chosen to do. In an environment where the pendulum has moved to the publisher side, why should they support the advertiser in a model with a proven 200% - 300% lift? Because maybe the pendulum will move back again. Gravity and 80 years of advertising history suggests it will – it's only a matter of when. What’s needed is not new technology; TruEffect has already developed and implemented this on a very scalable basis, but some new vision on the client and agency side. At that point, Data-Driven Display 3.0 will not just drive improved media performance; it will completely recalibrate the metrics and the investments of online advertising.
We’ve seen a major advertiser reduce or reallocate media spend by 50%, without the need for new budget or the expense of being held hostage by non-value add players in the eco-system. This is based on reviewing the actual results when you apply a stratified circulation methodology, and knowing how to control 50% of the traffic quality. It's just a matter of adoption. Unreasonable advertisers wanted!
– Martin Smith
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