TruEffect Blog

Go ahead, put all those eggs in one basket

Now that advertisers are opening their pocketbooks more, it’s a great time to take a comprehensive look at how your online advertising dollars are working across all efforts. eMarketer recently reported some statistics from “2010 Lead Generation Optimization Key Trends Analysis” from CSO Insights revealing that most marketers are increasing their budgets for lead generation and new customer acquisition.

It’s interesting to note that the largest increases reported are on web design/content, email marketing, social media, and SEO.  But how many advertisers are working to ensure that all their channels work together?  How are online display advertising dollars impacting both natural and paid search campaigns? And what about those email campaigns?

In another article by Bob Rose, "Do You Have A Marketing Credit Crisis?", he cites various multi-channel attribution models and says, “But really all of them have interesting solutions to creating a matrixed framework of conversion events, assigning values to engagement, and other values to metrics such as time-on-site, pages viewed, tracking through the funnel the percentage of credit that each tactic should get – and aaaaaah my head just exploded.” Sound familiar?

A while back, TruEffect published a paper on The Impact of Display on Search and concluded that a first-party solution helps with the exploding heads by allowing advertisers to control online campaign data from one central point – theirs. What would it be like to see into the various measurement methodologies of your media and technology partners, and understand who, and what, actually attributed to the success of your efforts? First party ad technology can provide a centralized way to look at campaign performance across channels. It gives a whole new meaning to putting all your eggs in one basket. Seriously. More, better, actionable data – less exploding heads. Everyone's happy.

– Layne Salter

OMB unleashes new privacy guidelines for Government

Two weeks ago the Government Office of Management and Budget (OMB) issued two new memoranda, M 10-22 and M 10-23, regarding web measurement and the utilization for 3rd party technology for government websites. The new guidelines are part of the OMB’s “Open Government Directive” and seek to promote transparency, participation, and collaboration while protecting individual privacy.

Although the new memoranda reverse a number of previous mandates, what bears scrutiny is that while there appears to be some easing of restrictions around 3rd party technology use on government sites, most current 3rd party ad tracking serving and measurement technologies still cannot comply with the new requirements. For instance, new guidelines allow for retention of data for only as long as deemed necessary, but not to exceed 12 months. Most ad server cookies are set for a minimum of 24 months, while others range up to 10 years. And data is commonly retained for more than 18 months.

Last summer, the Future of Privacy Forum, in their reply comments to the Federal Government Websites cookie policy, recommended that “Only ‘first party’ domains should be used, rather than ‘third party’ domains, to avoid potential for unwanted correlation across unrelated Web sites.” Likewise the Center for Democracy and Technology recommended that Federal Government Agencies serve and measure advertising from their own first-party Web domain. We agree. That’s why “first-party” solutions, like our own TruConnect technology, are still the safest bets going forward in an industry whose privacy practices are increasingly being called into question.

– Martin Smith

What women want

In a recent iMediaConnection article, Emily Girolamo makes some interesting observations about Relationship Advertising and women.  Girolamo states that 53% of women feel they form “relationships with brands online,” and that nearly “90 percent of women studied ‘wish’ they were sent more tailored offers from trusted brands.”  I concur.

Traditional advertising, like television, has long revered the female buying audience. Apparently we control the purse strings which I guess makes total sense because we’re the ones with the actual purses.  So, it’s not surprising that women are anxious to receive more relevant ads. As a female, with a purse, who also works in the online ad biz, I’m always gratified, if not amazed, when I receive an ad that actually hits the mark.  With interactive direct response technology maturing, I guess the question is – why doesn’t this happen more often?

Is it so hard for advertisers to market to me directly on the internet?  Every time I visit a website, Yahoo! mistakenly thinks I’m a good candidate for its products. What they don’t take into consideration is that I’m already a Verizon customer.  And I was looking at those schools for someone else.  And I only Googled Toyota to find the local dealer so I could make an appointment for my recalled gas pedal.  Is this retargeting technology at its finest?

So, while every targeting company out there claims to find the advertiser the “right customer, in the right place, at the right time” – they fail.  Sometimes miserably.  Tell me there’s a technology out there that knows whether I’m already a customer. That knows if I’ve already purchased. That actually knows something about what I want.  Oh, you mean like TruConnect? Shameless plug, I know. But seriously – online ad industry, please stop serving me irrelevant ads. 

– Layne Salter

A newer, sexier version of P3P?

A start-up called Better Advertising kicks off its public campaign this week to become the reference standard technology for online advertising industry self-regulation.  The technology manifests itself as an icon (the “Power I”) located in the upper-right corner of a participating advertiser’s display ad.  When a consumer mouses over the icon, they're presented with the data being used to perform behavioral targeting in the delivery of the ad, and have the option to opt out of future targeting.  The company says they enable advertisers to be more accountable to consumers.  Basically, it’s a way to expose what data is being used by what advertisers to force some restraint through transparency.

Previous attempts to disclose the use of consumer data for targeting haven’t fared too well.  For example, the Platform for Privacy Preferences project was a noble attempt to force advertisers to state in unequivocal terms how they used consumer data.  Those terms were actually embedded in a “compact policy” facility built into web browsers since 2002.  The organization supporting P3P was not a commercial entity like Better Advertising, and it's been dormant for three years. 

Another attempt, the Network Advertising Initiative, has been more successful, but today's regulatory and legislative circles that work on privacy matters suggest it's insufficient. The NAI is the organization behind the cookie-based opt out, long established as the vehicle for consumers to exert preferences over how their data is used.  But unlike the NAI, Better Advertising will actually provide details about how data is used before providing the opt out choice.

Draft legislation from Congressman Rick Boucher (D-VA), has thrown down the gauntlet to the industry, and FTC Chairman Jon Leibowitz has been rattling his sword at the industry for a year now.  If we collectively fail to act, swift and significant restrictions will be placed on advertisers' ability to leverage consumer information to improve media performance and deliver the most relevant advertising available.  Will the "Power I" get the job done?  A lot of media heavyweights support the effort, so it has as good a chance as any.  Transparency will be key, and the belief within legislative and regulatory circles that consumers will be satisfied with the options available to them. 

– Scott Nelson

Dead internet ideas

Doug Weaver, founder and CEO of Upstream, and frequent speaker at iMedia Summit series gives a great, uncensored look at the truths we tell ourselves in the online ad biz in his presentation on “12 Dead Internet Ideas.” We talk a lot about consumer privacy and "relationship advertising" here at TruEffect, and how internet advertising hasn’t really changed much in 10 years. We should know – we were there in late 20th century, developing technology to serve the first ad. But Weaver, in Steve Jobs keynote fashion, puts it ever so much more eloquently than a PowerPoint ever could.

Weaver’s dead internet idea called "The Right to Target" calls into question the industry’s never ending quest to pull out all the stops on targeting technology, while lulling consumers into complacency around their privacy concerns by ensuring them that they are exchanging their data for really cool candy – like better and more relevant ads that keep the internet free. Weaver says "We think because we can, we assume that we may."

But by downplaying the relevance of context, we just provide more of the same –thousands of meaningless impressions that nobody is clicking on. To understand what will actually reach, and impact, the consumer has been the illusive grail of advertising since Madmen wrote the Brylcreem jingle.

But Weaver cautions that "the landscape we're destroying is the one we'll need to live in, and profit from, for years to come."  Even though it looks as if the "cookie opt-in" clause will not make it into the Boucher bill - for us to "celebrate dodging that bullet is like whistling past the graveyard."  He reminds us that if we think that consumers and government don't decide how it goes, one only has to take a look at how the "Do Not Call Legislation" put phone marketing out of business in 48 hours. 

But, it’s just a presentation, right?

– Layne Salter

Display still healthy - but old approach needs to die

We’ve all seen a trend of positive indicators for the health of online display advertising over the last several months.Kantar Media predicts it will grow 5.0% in 2010, a number which normally would underwhelm, except that it follows a year in which display grew 7.3% while the industry saw overall ad spend drop a whopping 12.3%. Meanwhile, Yahoo! paid $100 million for media newbie Associated Content to bolster its inventory of traffic-generating material, and Facebook surpassed perennial leader Yahoo! to become the top US publisher of display ads on the web. And finally, this morning brought the announcement that GSI Commerce is acquiring specialty retargeting network Fetchback.com.

Display is not only alive and well, but it’s growing.But if display is going to continue to gain share of wallet from other channels, it’s entirely too inefficient. For what they’re worth, click through rates continue to remain below 1.0%. And while view-through has given display a tad more credit for performance, it fails to remove the waste. Digital display advertising is not like print or broadcast – so it’s time to stop simply throwing it out there to see what sticks (clicks).

At TruEffect, we work very hard to identify why our clients’ display campaigns deliver results, or not. If we focused only on the typical dimensions of performance like creative design, audience demographics, page position, interactivity or even copy, we’d miss the biggest part of the story.

Last week, TRA, a research firm devoted primarily to the cable set-top box, underscored our argument. According to President Bill Harvey, the gender and age of viewers has little correlation with the way they respond to ads. Yes, you may have a brand that is skewed heavily towards males with $100K+ incomes, but if the next affluent male you see in your campaign just bought your product, or a competitive product, that inventory is completely wasted. Some data we have assembled from recent campaigns tells the story better than words:

-A recent Telco client conducted an aggressive acquisition display campaign wherein 20% of the media was consumed by existing customers that could not make use of the offer and 42% was consumed by customers that were out-of-market and not eligible to buy.

-Despite frequency capping instructions provided to the publishers, a large direct response advertiser saw 42% of their display inventory consumed by 11.7% of their audience.

-And a large retail client saw 29% of all impressions consumed by users seeing a frequency of 30 ads or more!  (IOW – non-responders.)

These are just examples of why the industry feels that a 1% click-through rate and search-like CPCs are stretch goals. Display ads reach more consumers than any other online channel. If you can find out how to carve away even a small portion of the waste with a few simple techniques, it will easily become your most efficient channel.

– Scott Nelson

But, what do you really think social media is?

In an article today in iMedia Connection, with the provocative title (hey, it got me to click) “Why we need to kill social media”, Rob Key, CEO of Converseon, makes a well thought out argument that “the term 'social media’ itself is stunting the potential of the very force it is trying to describe and, hence, has outlived its usefulness.” Of course, Converseon is a “social media consultancy" so one can infer that the topic is near and dear to their hearts after years of trying to explain the so-called medium to clients.

But what entertained me were the comments. Apparently between the hours of 12:38 pm ET and 5:31 pm ET two warring factions managed to articulately (and somewhat diplomatically) duke it out. Shel Holtz, a consultant who develops social media strategies for companies, innocently started it all with his comment disagreeing with Rob’s point of view. Then Jeff Molander, professor of digital direct marketing at Loyola University’s school of business disagreed with Shel, siding with Rob and claiming that “all digital media is now social.”

Both camps made eloquent arguments. And, they are both right – depending upon the looking glass with which you happen to be currently viewing this complex topic. Is it really “media” from a marketing perspective, or a newly entrenched model so widespread it encompasses all modes of human communication? Like others in the online advertising biz, we at TruEffect have been watching as long held beliefs about consumer awareness are dispelled. Turns out, it's not a commodity to be understood and packaged within any one particular channel.  Those “eyeballs” do not live and function in a vacuum, and cannot be defined solely by their proclivity to type a keyword into Google, visit a particular website, Tweet about tomatoes, or leave lamps in their Overstock shopping cart.

Billions of words have been written on social media in the past few years. And, here I am – adding another 400 or so. But in the words of William Gibson, “The future is not Google-able.”

So, as of 5:31 pm ET, Jeff has had the last word.  I wonder if they left their computer screens and went out to “socialize.” All I know for sure, is that all three gentlemen in question, today, found an appropriate use of social media to further their individual causes. And now, I've done the same.

– Layne Salter

Ten years after

Instead of writing the typical January “how did I do with my predictions” post, I’ve waited until we’re back in the here and now.  Looking ahead, within the context of the progress we’ve made in the first decade of this medium, what we can expect?

February, 2000: Breathing a sigh of relief that we survived the Y2K conversion; a small group of men held a planning summit in Kuala Lumpur for a largely unknown consortium called al-Qaeda; Internet titan AOL had just entered into an agreement to “merge” with Time Warner and redefine the media landscape.  Internet advertising never heard of Google or Facebook, expandables and page peels were percolating in a lab, and the CPM was still king.

February, 2010: Breathing a sigh of relief that we’ve largely avoided a Swine Flu epidemic; airline travel is more time consuming than ever; and Time Warner just completed its spin-off of AOL after a painful marriage. 

A LOT has changed. But unfortunately, not enough.  We’re spending more than ever on interactive media, but the efficiency simply hasn’t scaled with that growth.  And when you look at the technology used today vs. ten years ago, very little has changed.  Sure, we’ve figured out some new economic models to buy and sell consumers’ attention, but the methods of delivery, measurement and targeting are basically the same as they were in 1997. 

Today, when we meet with clients and prospects, the triad of impression-click-conversion still rules decision-making.  Interactive advertisers have very few options other than massaging the same data with techniques such as path-to-conversion and weighted attribution.  The problem isn’t the math, it’s the data.

Ad serving, and soon thereafter bid-optimization, were both successful technologies because of the ability to consolidate both data and workflow.  Consolidating the data was thought to be the only way to effectively deliver meaningful performance.  But as the industry has matured, that couldn’t be further from the truth. 

A consumer’s perception of your brand and the interaction they’ve had with it (and I'm not just talking about purchases or customers – rather, any interaction) drives response more than any other variable.  This is further demonstrated when performing conversion attribution.  A recent study by a leading industry analyst recognized TruEffect™ in a wave study, as providing sophisticated attribution modeling worthy of recognition.  The difference is the data.  Not aggregated or consolidated data.  Discrete data owned and controlled by the advertiser. Data that describes the relationship an individual consumer has with their brand.

It’s this new approach to leveraging consolidated platforms with discrete data sources that will push interactive campaigns to new levels of performance.  Technology won’t be the foil, nor will new forms of content.  Treat each consumer appropriately based on what they’ve told you about themselves and their interest in your products or services.  And do so on an enterprise scale and in real time.  That’s what we can expect to be talking about ten years from now.

– Scott Nelson

Autonomy. Mastery. Purpose.

I just finished watching Daniel Pink’s (@danielpink) lecture on what really motivates people. It’s a packed 18 minutes of YouTube glory, but I want to chat about a few points that really stuck with me.  

•Incentives only work well with mechanical tasks – That’s right, commissions and bonuses mean nothing to people working on abstract tasks and solving problems.  Wow, talk about punching a hole into just about every salesman’s balloon.  When you first think about it, it might seem completely obtuse, flying in the face of our beautiful free-market capitalism.

But after listening to Dan a little longer, it starts to make sense. Adding a little to his lecture, my take is pretty simple.  It’s not just about the money; people need to believe when they spend 8 hours a day, five days a week for decades working on something, that they are working towards a greater cause.  It’s gotta mean something, not just to the worker but to the World. 

• “Management didn’t emanate from nature.  Management is not a tree, it’s a TV… someone invented it, and it doesn’t mean it’s going to work forever.”  This one is sure to make disgruntled employees around the world thrust their fist in the air in defiance of their overlord managers.  But don’t get too carried away because the implications of not being managed may not be evident at first take.

It’s pretty simple – you’re going to have to think for yourself.

Yup, that’s right. No management means you have to figure out the problem, not wait for someone to tell you what to do.  If we’re all honest for a minute, we’ve really gotten comfy with other people making decisions that we are cleared to not care about and f-up. Yikes, a zinger there, but… deep in your soul search, and find it true you will.

•Fedex days – You have 24 hours to work on anything you want.  Only catch, you have to deliver something at the end of those 24 hours and present it to the company.  Maybe a new code, develop a flash game or maybe “get your creative on” a process that sucks right now, it’s totally up to you.  He claims 50% of Google’s innovations come from days like this, where their super geeks are able to let their mind run wild and not be confined by the cage of the everyday.

Next post will be about how this can be applied to a marketing company – agency, technology, advertiser or random guy tweeting allllll the time (uuuhhh… I didn’t mean me!?!?).  Stay tuned, feels like this framework fits well into our industry.  In the meantime, feel free to send across any ideas you may have.

– Brian Murphy

Is the FTC getting superpowers?

I know, I know. At TruEffect we like to talk about online consumer privacy – a LOT. We’ve talked, sometimes ad nauseam, about the Federal Trade Commission’s Staff Report on Behavioral Advertising, and have closely followed the debate on the state of industry self-regulation.  While the FTC’s report is quite clear, the industry has largely disagreed with the positions posited by the FTC, and ignored their not-so-thinly veiled threats of government regulation – believing that the industry can certainly regulate itself long before a need arises for the government to do it for us. Well, it’s not that we take pride in saying, “I told you so,” but……

Yesterday Wendy Davis from MediaPost wrote about the online industry having their panties in a bunch around the new legislation before Congress that will make it much easier for the FTC to create rules and bring civil law suits. She writes “The current House version creates a new consumer protection commission while also beefing up the FTC's power in a few key ways. The bill removes administrative hurdles to the FTC's rulemaking ability, makes it easier for the agency to pursue civil litigation, and allows the FTC to target ad companies that aid and abet unfair practices.”

And if you want to know what the FTC considers unfair practices, you need only to read their aforementioned “Self-regulatory principles on behavioral advertising.”  I keep remembering FTC Chairman Jon Leibowitz’s comment, “A day of reckoning may be fast approaching.” If the IAB feels the need to lobby against this current legislation, does that mean self-regulation has failed? Will third-party data models like those used by behavioral targeting companies and third-party ad servers be at risk?

– Layne Salter