Behavioral Targeting Industry Needs Further Delineation

I received an interesting press release the other day from ValueClick Media that recapped a recent behavioral targeting panel that took the stage at the Hard Rock Hotel in Chicago.

The panel featured an industry analyst (David Hallerman, senior analyst, eMarketer), a behavioral targeting product expert (Joshua Koran, vice president, targeting and optimization, ValueClick, Inc.), a brand marketer (Julian Chu, Director of Acquisition Marketing, Discover) and an interactive agency executive (Sam Wehrs, Digital Activation Director, Starcom).
 

I received an interesting press release the other day from ValueClick Media that recapped a recent behavioral targeting panel that took the stage at the Hard Rock Hotel in Chicago.

The panel featured an industry analyst (David Hallerman, senior analyst, eMarketer), a behavioral targeting product expert (Joshua Koran, vice president, targeting and optimization, ValueClick, Inc.), a brand marketer (Julian Chu, Director of Acquisition Marketing, Discover) and an interactive agency executive (Sam Wehrs, Digital Activation Director, Starcom).

What I found most interesting about the release was that fact the group discussed and agreed on the need for delineation between the different approaches to behavioral targeting.

“While it is important to understand the difference between retargeting – which Hallerman referred to as “reactive” – and the more complex models, the panel agreed it is also critical to understand the differences within the more sophisticated group of behavioral targeting approaches, and Joshua Koran shared three designations: “clustering,” “custom business rules” and “predictive attributes,” the release said.

The “clustering” approach assigns each visitor to one and only one segment while the “custom business rules” approach offers marketers the ability to target visitors who have done X events in Y days, with Boolean operators of “and.” “or,” and “not.” Finally, the “predictive attributes” approach automates the assignment of interest categories based on the visitor activities that best correlate with performance; thus, the system is continuously learning to identify multiple interest attributes per visitor.

Another notable takeaway was the need for a focus on the customer experience and the corresponding importance of demonstrating value to customers when serving behaviorally targeted ads.

According to the release Julian Chu offered three questions marketers must address to make behavioral targeting a valuable experience for customers instead of merely serving the ads, which would unavoidably become customer annoyance: How are you going to do it? Where is it going to happen? What is going to happen at that time?

Presented as part of ValueClick Media’s ongoing Media Lounge education event series, this event – The Changing Behavioral Targeting Landscape – as well as the discussion itself underscored the importance of education relative to this increasingly important online advertising technique.

Food for thought!

DM Hiring Down

Just when you thought it was safe…

While the economy has been a thorn in everyone’s side over the past few weeks, we have heard some encouraging words about the online and digital marketing world. Online sales are up, we’ve heard, and digital marketing may increase in a recession. So all wasn’t so bad.

Just when you thought it was safe…

While the economy has been a thorn in everyone’s side over the past few weeks, we have heard some encouraging words about the online and digital marketing world. Online sales are up, we’ve heard, and digital marketing may increase in a recession. So all wasn’t so bad.

But in my inbox this morning, I was greeted with a real clunker: According to a press release from Berhart Associates Executive Search, continued layoffs and more hiring freezes appear to be on the horizon for direct marketers this spring.

According to the latest Bernhart Associates employment survey, 54 percent of the companies responding said they will be filling new positions during the current spring quarter, down from 58 percent last quarter. The percentage of companies that have imposed a hiring freeze jumped to 19 percent, compared with 13 percent last quarter and more than double the rate just six months ago. Planned layoffs remained unchanged at 12 percent.

A total of 129 companies responded to the random survey that waa e-mailed the week of April 1.

Jerry Bernhart, owner of the Owatonna, Minn.-based search firm that conducted the survey insists, however, that there is some good news in all of this.

“If you look at what’s going on now and compare it with what happened during the last downturn in 2001-2002, things are still holding up better on the jobs front,” said Bernhart, in the release. “All of our indicators were weaker back then. Direct marketers this time around are turning more to hiring freezes and doing what they can to avoid significant cutbacks in staff. They know that when things turn around, talent will be more difficult to come-by.”

Even in the current environment, said Bernhart, many companies are still having a
challenging time finding qualified candidates for certain positions. “Nearly
three-quarters of those responding said they are having some degree of difficulty filling
openings,” said Bernhart. “For the most part, these jobs are more specialized lower to mid-level positions, or they are in geographic locations where the available direct marketing labor pool is relatively small.”

When asked what positions will be in greatest demand during the coming three months,
Bernhart said sales dominated the list. “This is similar to what we saw during the last downturn. Many companies apparently believe that a good way to weather an economic downturn is to increase the effectiveness of their sales force, and that’s exactly what
many of them are doing.” Bernhart said analytics was a close second, followed by account managers.

So, I guess there is still some hope, I guess.

Are You Attending the DMCNY Luncheon on Thursday?

If you are interested in youth marketing and based in New York, why not check it out? (I’ll be there!) The luncheon speaker is Sara Laor, a youth industry analyst. According to literature from the Direct Marketing Club of New York, Laor will discuss how e-mail, video, social networking and the mobile Web are important in reaching this group.

If you are interested in youth marketing and based in New York, why not check it out? (I’ll be there!) The luncheon speaker is Sara Laor, a youth industry analyst. According to literature from the Direct Marketing Club of New York, Laor will discuss how e-mail, video, social networking and the mobile Web are important in reaching this group.

The discussion will touch on “The Gift Economy”; the emerging tradeoff between privacy and consumers wanting to be targeted for their particular needs and wants; the new trend of young moms staying at home; and what it all means to you and your direct marketing efforts

Read more and register at www.dmcny.org

Online Sales Continue to Climb, Despite Struggling Economy, Study Finds

Want to her some good news amdist all of the bad news surrounding the economy?

According to The State of Retailing Online 2008: Marketing Report–the 11th annual Shop.org report based on a study conducted by Forrester Research of 125 retailers–online retail will continue to be a bright spot in the industry with retail sales rising 17 percent this year to $204 billion.

Want to her some good news amdist all of the bad news surrounding the economy?

According to The State of Retailing Online 2008: Marketing Report–the 11th annual Shop.org report based on a study conducted by Forrester Research of 125 retailers–online retail will continue to be a bright spot in the industry with retail sales rising 17 percent this year to $204 billion.

Apparel ($26.6 billion), computers ($23.9 billion), and autos ($19.3 billion) will be the largest three sales categories.

According to the report, online retailers allocate 53 percent of their marketing budgets to online customer acquisition and 21 percent of marketing dollars to online customer retention. However, retailers are finding that traditional acquisition programs such as search engine or affiliate marketing may also serve as retention tools that attract existing customers as well as new shoppers.

Retailers report that search engine marketing continues to be the most effective way to reach new customers, citing 35 percent of sales coming from that initiative. As a result, nearly all online retailers surveyed (90 percent) use pay-for-performance search placement, and 79 percent said they will make this tactic an even greater priority this year. Companies are also using offline marketing tactics to drive customers to the web, with catalogs and other direct mail pieces taking priority over methods like television and newspaper advertising.

Though free shipping offers have proven to get some consumers over the obstacle of shopping online in the past, the study showed that retailers’ are less interested in promoting free shipping options this year. While 85 percent of online retailers said they used some shipping with conditions promotions in the past, just 35 percent said that they would focus more on these types of promotions in 2008. Instead, retailers are eager to experiment with Social Computing initiatives to attract customers – 65 percent and 55 percent of retailers respectively said that social network advertisements and widgets would be categories of increased focus this year. However, Social Computing efforts to this point have been considered more effective for brand-building and less proven for driving revenue or sales conversion. Therefore, the report advises retailers to continue investments in proven techniques like email marketing and free shipping promotions to drive sales.

The State of Retailing Online 2008: Marketing Report is currently available to Shop.org members and can also be purchased directly at www.shop.org/soro08.

LeadsCon: Everything You Want To Know About Online Lead Gen

Had a great time at LeadsCon this week.

I was invited to serve on an expert panel of judges for LeadsCon’s “In the Spotlight’ Company Showcase.” The showcase, which took place on April 3, the first day of the first LeadsCon, provided a stage for some companies that may not be well known to a general audience, but had something truly unique to talk about.

Had a great time at LeadsCon this week.

I was invited to serve on an expert panel of judges for LeadsCon’s “In the Spotlight’ Company Showcase.” The showcase, which took place on April 3, the first day of the first LeadsCon, provided a stage for some companies that may not be well known to a general audience, but had something truly unique to talk about.

Other judges on the panel included Jodi Harris, managing editor, iMediaConnection; Mike Kelly, media advisor, investor and chairman, Eyeblaster; and Jay Webster, general manager, lead generation, Yahoo.

Each company presented for seven minutes. Us judges then had two to three minutes during which to share our impressions with moderator Saar Gur (Partner, Charles River Ventures). The companies represented a broad mix, and each were selected for bringing something slightly different to the table. They were all really neat.

Two companies aid in the acquisition of customers (MarketingAnd and Creative Calls), while another was one of the pioneers in the new era of ad networks (SocialMedia Networks). Others were AdReady, which makes display advertising as accessible as search; GLAM Interactive Group, a women’s-only business networking group; and Mint.com, a consumer-oriented Web site that shows what happens when you focus on the consumer and build something they can’t live without. And, one company was well established (TARGUSinfo) but presented a new product helped make quality a focus in this space.

The winner? SocialMedia Networks, because they have built an innovative platform for publishers of social media applications to monetize their traffic.

I thought they were all great, though!

The conference in general has been great as well. LeadsCon was created and produed by well-know online lead generation guy Jay Weintraub. It is a conference and expo expressly designed for companies and individuals in the online lead generation and customer acquisition industry.

Many conferences address online advertising and marketing, and some vertical confercne address online lead generation in their industry, but LeadsCon is the only event I know of to focus entirely on the challenges, issues and opportunities that are unique to the fast-growing, sometimes controversial and ever-changing online lead generation and customer acquisition segment.

The conference was targeted, well attended (over 600 total attendees, according to Jay) and interesting. It also had a warm, family feeling to it. In fact, Jay’s mom helped out with registration! And most speakers were fiends with Jay from his background –he worked at Advertising.com and Oversee.net—and all commented on what a great guy he is.

Congratulations, Jay!

Ed Ojdana at LeadsCon

If there truly is a rock star in the world of online lead generation, it is Ed Ojdana.

If there truly is a rock star in the world of online lead generation, it is Ed Ojdana.

Ojdana recently retired as global president of Experian Consumer Direct, a division that was created in 2002 to focus on the consumer credit management market. Experian Consumer Direct combined the operations of CreditExpert, Experian’s consumer credit management group, and ConsumerInfo.com (also known as FreeCreditReport.com), the largest provider of online credit reports and other credit-related information to consumers. Ojdana founded ConsumerInfo in 1995.

At LeadsCon, Ojdana spoke with Jordan Rohan, founder of Clearmeadow Partners, an investment firm that focuses on the Internet space. Previous to founding Clearmeadow, Rohan served as managing director and Internet analyst for RBC Capital Markets.

The two discussed trends in lead generation.

“Going forward, we are going to have to start tying more content to lead generation,” said Ojdana. “The landing page will have to have something more there than just an offer to buy a product or service. People today are looking for information.”

While Rohan thought Ojdana’s point was a good one, he wondered aloud whether or not there is a need for a “full-frontal” approach, where visitors click on a landing page with an offer they can buy immediately.

While Ojdana said there is a time and place for that kind of lead generation, the content play usually leads to better leads.

“If you’d like to just have folks buy an item on a one-time basis, that would work,” he said. “But the key to content is [how it can help build] lifetime value with the consumer, as opposed to the consumer signing up for something on an impulse.”

Rohan asked Ojdana to discuss other things a lead generator should do to generate quality leads.

Ojdana spoke of the importance of good segmentation.

“To do a good job of that, go back to your advertisers and really find out who their customers are,” he said. “ If you are [targeting ads to] a school, and 90 percent of the people who are converting are Hispanic, that means you have to get up there on some Hispanic sites, as opposed to blasting [ads] all over the place.”

He also said that lead generators should “live and die for analytics.”

All true words, indeed.

Consumers Know They Are Being Tracked

According to a recently released study by consumer privacy organization TRUSTe and global market insight
and information group TNS, consumers generally know that their internet activities are being tracked for purposes of targeting
advertising.

Are they OK with it? Not really. They study also revealed a high level of concern associated with that tracking,
even when it isn’t associated with personally identifiable information.

According to a recently released study by consumer privacy organization TRUSTe and global market insight
and information group TNS, consumers generally know that their internet activities are being tracked for purposes of targeting
advertising.

Are they OK with it? Not really. They study also revealed a high level of concern associated with that tracking,
even when it isn’t associated with personally identifiable information.

Behavioral targeting, which enables marketers to deliver customized experiences and improved marketing
metrics, also runs up against consumer privacy concerns and calls for greater
transparency around emerging tracking and targeting techniques.

Based on
the results of the survey, lack of transparency may factor into privacy
concerns. In fact, 71 percent of online consumers are aware that their browsing
information may be collected by a third party for advertising purposes, but
only 40 percent are familiar with the term “behavioral targeting.” In addition, 57
percent of respondents said they are not comfortable with advertisers using
that browsing history to serve relevant ads, even when that information
cannot be tied to their names or any other personal information.

Meanwhile, a majority (91 percent) of respondents expressed willingness
to take necessary steps to assure increased privacy online when presented
with the tools to control their internet tracking and advertising
experience, and this, accoridng to TRUSTe and TNS, suggests a need for added education, transparency and choices
for behavioral targeting. Nearly two-thirds (64 percent) would choose to
see online ads only from online stores and brands that they know and trust
and 44 percent of respondents would click buttons or icons to make that
happen.

To the contrary, a similar proportion of consumers (42 percent) said they
would sign up for an online registry to ensure that advertisers are not
able to track browsing behaviors, even if it meant that they would receive
more ads that are less relevant to their interests.

What these results boil down to is that consumers say they want more relevant advertising, but don’t want
to be tracked in order to get it.

What is the key takeaway here? Transparency, transparency, transparency. Consumers today are more sophisticated and educated than ever before. They understand advertising, and in many cases, respond to it and even enjoy it. So don’t take chances–be a trustworthy and transparent company.

Opening Up a Dialogue About Spam

I learned about an interesting survey yesterday.

It basically was focused on the fact that many legitimate advertisers following the e-mail industry’s best practices still find themselves not connecting with consumers due to the spam button.

I learned about an interesting survey yesterday.

It basically was focused on the fact that many legitimate advertisers following the e-mail industry’s best practices still find themselves not connecting with consumers due to the spam button.

As a result, online marketing services provider Q Interactive and marketing research firm Marketing Sherpa conducted a survey to look into consumers’ definition of spam. What did they find? For starters, that there is a big disconnect between what consumers see as spam and what is considered to be spam by the interactive community.

According to the two firms’ “Spam Complainers Survey,” the definition of spam has changed from the permission-based regulatory definition of “unsolicited commercial e-mail” to a perception-based definition centered on consumer dissatisfaction.

In fact, according to the survey, more than half of the participants–56 percent–consider marketing messages from known senders to be spam if the message is “just not interesting to me”. In addition, 50 percent of respondents consider “too frequent e-mails from companies I know” to be spam and 31 percent cite “e-mails that were once useful but aren’t relevant anymore”. (Respondents could select more than one answer for multiple questions in the survey.)

When it comes to using the “report spam” button—the primary tool Internet Service Providers (ISPs) provide consumers to counter the problem—nearly half of respondents (48 percent) provided a reason other than “did not sign up for e-mail” for why they reported an e-mail as spam. In fact, underscoring consumers’ varying definitions of spam, respondents cited a variety of non-permission-based reasons for hitting the spam button, including “the e-mail was not of interest to me” (41 percent); “I receive too much e-mail from the sender” (25 percent); and “I receive too much e-mail from all senders” (20 percent).

The surey also found that there is a pervasive confusion among consumers regarding what they believe will happen as a result of clicking the “report spam” button. Over half of respondents, 56 percent, for example, reported it will “filter all e-mail from that sender” while 21 percent believe it will notify the sender that the recipient did not find that specific e-mail useful so the sender will “do a better job of mailing me” in the future. Even more indicative of the lack of understanding, 47 percent believe they will be unsubscribed from the list by clicking “report spam” while 53 percent do not believe the button it is a method to unsubscribe.

Not surprisingly, accompanying this confusion is the frequent misuse of the “report spam” button. The survey found a large number of consumers, 43 percent, forgo advertiser-supplied unsubscribe links in email and simply use the ISP’s “report spam” button to unsubscribe from an advertiser’s list—regardless of whether or not the email fits the consumer’s definition of spam. Moreover, a full one in five consumers (21 percent) use the “report spam” button to unsubscribe from e-mail they specifically do not consider spam.

To address this problem, Q Interactive has called for ISPs, marketers, advertisers and publishers to come together with industry associations such as the Interactive Advertising Bureau to agree on a solution that is beneficial to consumers and all interested parties. To begin the dialogue, Q Interactive suggests two points for discussion:

* Replace the broken “report spam” button with buttons that more clearly indicate consumers’ intentions such as an “unsubscribe” button and an “undesired” button.

* ISPs should categorize e-mail senders based on their practices to identify and reward senders who follow best practices in transparency and permission.

For the good of our industry, we should all pay heed.

Social Networking for DMers

Here’s a novel idea.

The National Mail Order Association is launching new direct marketing networking groups in each state of the U.S., and using social media as a component.

The NMOA’s strategy is to incorpate the social networking site Facebook as the first point of contact, and combine it with the all important aspect of “human interaction” that only comes from in person face-to-face networking.

Here’s a novel idea.

The National Mail Order Association is launching new direct marketing networking groups in each state of the U.S., and using social media as a component.

The NMOA’s strategy is to incorpate the social networking site Facebook as the first point of contact, and combine it with the all important aspect of “human interaction” that only comes from in person face-to-face networking.

“Online social networking is all the rage, but business does not live by the net alone,” said NMOA president and chirman John Schulte in a press release. “Face-to-face networking is still vital to business and career success,[and] these new networking groups combine the old with the new for super networking”

The online Facebook groups will be for day-to-day networking and information sharing, and once a month or more, members will coordinate local outings for some face-to-face networking, and have a little fun at the same time.

The best part? It’s all free. The NMOA will not require membership to be part of any of these groups.

“These new networking groups are needed,” says Schulte. “You can’t deny it, direct marketing is the way of the future, almost every business now utilizes at least one direct marketing tactic for creating sales, be it the web, direct mail, catalogs, infomercials, television home shopping or response ads in newspapers and magazines, and people want to learn more, especially the small business and budding entrepreneur.”

So far, direct marketing groups have been set up for 19 states and one main group for international connectivity. New states will be added as people request them. People that want to get involved on a leadership level in their state will be made officers of the group.

Every group is set up so members can start a discussion, ask questions, share links, promote their company, and post videos and pictures. If for no other reason, people should join their state group as part of their overall Web 2.0 strategy.

Links to currently active states can be found here: http://tinyurl.com/2ntwdc

Does Your Web Site Have Performance Issues?

According to just-released data from JupiterResearch (www.jupiterresearch.com), your Web site may not be performing as well as you think it is. And, these performance issues may be causing lost sales.

According to just-released data from JupiterResearch (www.jupiterresearch.com), your Web site may not be performing as well as you think it is. And, these performance issues may be causing lost sales.

According to statistics released by John Lovett, a senior analyst at New York City-based JupiterResearch‑at a panel given at the Internet Retailer Web Design08 conference last week in Miami‑ 48 percent of 121 executive at business-to-consumer companies surveyed by the search firm last October said that their peak traffic and/or unexpected load caused performance problems on their Web sites in the prior 12 months.

In addition, 40 percent experienced an unplanned outage of their primary Web site, and 38 percent said content or images failed to render.

But that’s not all.

According to the research, 29 percent of responders said transactional application experienced problems or downright failed; 25 percent said certain areas around the country did not have access to the Web; and 22 percent said their customer relationship management systems were down during business hours.

Finally, only 14 percent of business-to-consumer decision-makers claimed no performance issues.

Are you having performance problems? Do you know? Its probably a good idea to find out.

To do this, JupiterResearch’s Lovett recommended using performance monitoring options such as Web site and application monitoring tools (from companies such as AlertSite (www.alertsite.com), Gomez (www.gomez.com), or Keynote Systems (www.keynote.com); content delivery networks (from companies such as Akamai (www.akami.com), CDNetworks (www.cdnetworks.com) and EdgeCast (www.edgecast.com); or customer experience management tools (from companies such as Coradiant (www.coradiant.com) and Tealeaf (www.tealeaf.com).

There is a lot to choose from out there, so tread carefully. Do your research, find out which tools are best for your company, and then take the plunge

You’ll never know how much business you may lose from performance issues without them.