Five facts about online behavioural or interest-based advertising

Here are five facts about online behavioural or interest based advertising:

FACT 1:

Advertising helps fund a wide range of the content, services and applications online (often overlooked or not understood by policy makers and / or regulators). For example: search engines, helping us to navigate and explore a world of information online (and all at the click of a button), are advertising funded. Customised advertising (for example behavioural or interest based display advertising) seeks to make this more relevant to our interests, helping us to find what we are looking for.

FACT 2:

People prefer this - particularly if it gives them the content and services they want at little or no cost. IAB research found that over half the online UK population would prefer to see more relevant online advertising and an even higher proportion would prefer this if it allows them to enjoy this for little or no cost.

FACT 3:

The advertiser (or its contracted partner) does not know who you are or where you live. Interest based advertising is non-identifiable. If information collected is used with data that can identify you (eg registration data) the user is informed as required by strict data protection law. Good practice requires the provider to make the user aware of any data collection and use for this purpose and also make available ways for users to control this.

FACT 4:

There is no commercially live business in the UK practising behavioural or interest based advertising via (what is known as) deep packet inspection techniques. The Office of Fair Trading (OFT) recently concluded that "in the case of behavioural advertising based on deep packet inspection techniques...the Information Commissioner's Office (ICO) considers that active opt-in is required to indicate consent".

FACT 5:

You can also tailor privacy (and other) preferences via the web browser used to access the internet. Here are some helpful user tips.



And if you want to know more please visit http://www.youronlinechoices.com/ or download the IAB's own guide at www.iabuk.net/behaviouraladvertising.html.

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Experience Paradox

There has been a surge of industry commentary recently encouraging people to share case studies and research in areas like search, video and social media marketing – I’m guilty of pestering hundreds of marketers myself. The reason is because those of us asking know that we only improve in one of two ways: 1) personal experience 2) shared experience. When we ask for case studies and research in marketing the point is to speed experience across the whole market by sharing.

Frustratingly, very few people want to share what they’ve learnt openly, restricting overall market knowledge and in the long term, potentially their own knowledge as a result. An individual withholding lessons learnt maintains a competitive advantage initially but limits an overall community’s progress, slowing the community’s learning, and in turn slowing the further learning of the individual. This is the experience paradox. Often the result is slow growth or a single market leading monopoly.

To give away your experience is to give away your business. Or is it? The instant after you share, you personally are always worse off while the people you shared with are better off. This is clear-cut if you only think about the present and you ignore the nature of humans. By sharing with a community it's more likely others will share too - particularly if you agree beforehand - and suddenly that particular community, and its members, is in a much stronger position.

Apply this to marketing and the bigger picture is that the discipline that shares the most experience becomes stronger overall. Ultimately the majority of individuals in that sector will increase their own share of experience.

If one person doesn’t pull their weight, it falls apart. Clay Shirky calls this dilemma ‘the tragedy of the commons’, first described by Garrett Hardin. Whereby those in a community whom all contribute equally benefit, but when one person doesn’t contribute that individual becomes better off to the detriment of the wider group. The end result is that no one contributes. In this situation, the sectors that don't share are worse off – a major failing of that community and a competitive disadvantage for everyone in that sector.

So, which marketing disciplines are suffering from the tragedy of the commons? Probably the ones that need to share the most like video, social media etc. Other disciplines like traditional marketing and even online search and display have had decades to tease experience out of the market to piece together a solid business case from various scraps. If the emerging marketing disciplines want to compete with the established disciplines, they need to collectively become equally as proven extremely quickly. A feat only possible through sharing, which is arguably easier now we have the internet.

To break the experience paradox and to prevent the tragedy of the commons in marketing, people tend to need incentives like awards or press coverage to share what they’ve learnt. The real incentive should surely be growth, at least until a discipline is fully established. Share within your particular marketing discipline and that community will grow, growing your share in turn.

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Are traditional marketers ignoring online?

In answer to my own question, no. It’s fairly patronising to think traditional marketers don’t get or don’t want to have anything to do with online marketing when of course they do. They just aren’t as manically obsessed with / immersed as online specific marketers. However, in the IAB’s National Search Marketing Barometer 2010, I have noticed two stats that indicate a need for traditional marketers to act.

The first is that 99% of senior traditional and online marketers from the top 100 brands believe there is a greater opportunity to integrate search into wider media campaigns. The second is that only 30% of those surveyed believe people outside of online teams fully understand search marketing. Given that search marketing is a form of marketing that connects, flows and is directly influenced by other media (and indeed our lives outside of media), this is a problem.

Clearly there is still a need for traditional marketers to understand how search can work with, extend and improve the likes of print, radio, outdoor and direct mail campaigns. There’s plenty of helpful info floating around at the moment from the likes of the RAB and the search engines, but it’s up to those of you in traditional media to spend a few minutes reading it.

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Search marketers hooked on traffic but demand attribution metrics

Search marketers are currently using traffic volumes to judge the success of their campaigns, but need more conversion attribution data to fully understand the effectiveness of their activities.

The IAB's 2010 National Search Marketing Barometer, completed by 144 search marketing professionals, highlights the data needs and frustrations of the search marketing community. The results of the research show that traffic levels are the most popular way of assessing activities - followed by sales and conversions, cost per engagement, visit duration and bounce rates.

The research also shows the data points that search marketers don't have access to, but feel would be most useful for their businesses. The most desired additional metric is competitor data / benchmarking, followed by conversion attribution data, advanced SEO information, cross media influence and vertical specific information. 

Conversion / Value attribution models are also highlighted as the areas of information that search marketing professionals have the least data on when planning campaigns. Only 19% of those surveyed felt that had enough data in this space, while 64% said that they needed more information on conversion attribution.

The continuing fragmentation of online business models and the multiple touchpoints that consumers have with digital marketing messages makes understanding conversion attribution increasingly complicated. The IAB's Customer Conversion Journey research further highlights the way that consumers interact with different online channels and shows that when buying flights online a user can be exposed to up to nine display ads, two emails, three natural search click throughs and two sponsored click throughs over a period of up to seven days.

With so much influencing a consumer's journey, the last click attribution model seems to be overly simplistic, but any model that takes into account the influence of different online touchpoints is difficult to construct - especially taking into account the variation in contribution of different channels from sector to sector and client to client. Despite that, as the National Search Marketing Barometer illustrates, a more complex attribution model is definitely demanded and would help search marketers plan and assess their activity more effectively.

Search specialists - where are you?

The IAB’s National Search Marketing Barometer 2010 revealed that 36% of brands struggle to find skilled search staff; does this feel high to you?

With search marketing increasingly being used for brand building (78% said search can build brand either directly or as part of the full user journey) and with budgets set to stay the same or increase over the next year  it is vital for every marketer - not just specialists - to understand the importance of search.

What was once a specialist subject is becoming a fundamental part of any marketer’s armoury and it’s vitally important for all marketers to understand how it fits into the media landscape. This can be quite difficult - and I say this with personal experience. Without actually practising the art of search it can be quite a daunting area to understand and even harder to master.

So what resources are out there to help?

36% of respondents saw a search qualification as unimportant when they were looking for potential employees, echoed in an article by Will Cooper in September 2009 hinting that advertiser and agencies found it hard to differentiate between accreditation schemes, so their importance becomes diluted.  However these are a solid initial check for good, basic search knowledge. There are a number of search qualifications available in the market which are mainly provided by the search engines (Yahoo’s Network Certified Agency scheme, Google Conversion Programme, Google Advertising Professional, Google Analytics IQ and Microsoft AdExcellence). 

Although accreditation may be seen as a ‘nice to have’, practical hands-on experience and understanding how search works – especially with other channels – is essential. “A good way to spot a good search marketer is to look for a digital native,” states Andrew Girdwood, Head of Strategy at Bigmouthmedia, “Do they blog, are they on Twitter and is their own site well optimised?”. 

The IAB’s National Search Marketing Barometer 2010 also revealed another interesting fact which brings me back to my original point. Only 38.6% of respondent felt that their whole organisation understood the important of search and 60.5% said that search is specifically left to the digital teams and search specialists. At the IAB we strongly believe in education, and feel it is now essential for marketers to not only be channel specialist but understand the entire landscape.

With search now worth £2.15 billion in 2009 it not only shows its strength but that it is no longer something that should no longer be isolated in brand specialist teams. There is an increasing need for marketers to understand search and particularly its value when used in collaboration with other marketing channels.

To learn more about search marketing visit the IAB Search Help Centre. www.iabuk.net/search

From Kraftwerk to craft work – it’s more fun to compute

At last week's Guardian Activate summit, the UK’s Digital Champion Martha Lane Fox outlined her reasons for attempting to get 100% of the UK population online by the time of the London Olympics. Lane Fox used a number of examples from her recent travels round Britain to explain why her current crusade is so important for the UK – and in particular for some of the most excluded sections of the population.

One anecdote in particular helps to highlight how far we've come – but also how far we still have to go.

Lane Fox explained that she had been invited to demonstrate the internet to an elderly lady live on Radio 4. When she asked the woman what she was interested in, the response "craft work" came as something of a surprise. "All I could think of was the German techno band" said Lane Fox.

The accidental comparison is useful. If we look at this video taken from Kraftwerk's visionary 1981 album Computer World, and consider this week's news from the Joseph Rowntree Foundation that home internet is now seen as an 'essential', we can see that what seemed like a distant dream back in 1981 is now a reality. But crucially, access to this dream is currently not open to everyone in the UK.

Getting back to Lane Fox’s example, the internet has the power to transform lives and improve the quality of life for millions in the UK – even in the seemingly mundane example of an elderly lady with an interest in craft work. As Kraftwerk would have it, it’s more fun to compute.

This is one of the reasons why the IAB is supporting Race Online 2012 - and why we would also urge our member companies to get involved.

According to Race Online figures, more than 10 million adults across the UK have never used the internet, and worryingly 4 million of this group are also socially excluded.  All of them are missing out on the opportunities and cost efficiencies that the web has to offer.

What’s more, PwC figures show that if everyone in the country was online, total benefits to the UK will be in excess of £22bn and households will save £560 a year. With increased numbers of people online, media owners and brands alike will also have the opportunity to extend their customer bases and grow the increasingly vital digital economy.

We believe Race Online 2012 is a vital initiative which will not only bring huge social benefits, but will help in the development of a crucial area of growth for this country.

For more information about getting involved in Race Online 2012, visit the website.

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Perils of search complacency

The IAB’s National Search Marketing Barometer 2010 (4MB) is a ‘state of the market’ survey based on responses from the majority of the top 100 brands in the UK conducted by the IAB Search Council. There are many positive insights in this report, such as budgets continuing to grow, but the biggest trend seems to be a sense of complacency – search works, so let’s stick with what we know.

Will Cooper, the search commentator at NMA said in an article back in May that “while nowhere near close to decline, [search] doesn’t seem to have the verve it once had.” He highlighted a number of reasons for this and even stated that the sector felt “a bit boring”. For people immersed in search, it’s easy to look at this opinion aghast because search and consumer search behaviour has changed so much. It is, however true if we read between the lines of the barometer’s findings and look beyond search specialists to marketing seniors, directors and heads.

Commenting on a Marketing Magazine article about the IAB Search Council’s study, Martin Thomas, author of Crowd Surfing, hits the nail on the head, “Ironically the emergence of search specialists within client organisations has simply encouraged senior marketers to abdicate any involvement in the discipline.” Search marketing isn’t really a difficult subject to understand, but it does require everyone to allocate time to learn and want to be educated.

Highlighted in the National Search Marketing Barometer 2010 is a significant knowledge gap for the majority of senior marketers in brands on new technologies and techniques like mobile, video and social search and for advanced data and testing. Alarmingly, 54% of brands don’t know who owns their search campaign intellectual property, when in fact brands themselves should own it! It’s one of the most valuable assets a brand owns, as highlighted in our intellectual property best practice paper released two years ago.

Educational material is made freely available on the IAB website’s search section, and from agencies and the search engines themselves. There’s a wealth of creativity and opportunities to be had during this time of search evolution as new types of content emerge across the internet. Perhaps we in the search industry assume other people find search boring – perhaps they do - but it's an incredible, dynamic, innovative space that should excite and involve all marketers.
 
With 99% of brands believing their search marketing could be better integrated with the rest of their marketing mix, now isn’t the time to be complacent, it’s time to dive back in.

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BP search strategy spills over

What do you do when you're rapidly becoming the most reviled company in the world and are the focus for intense international criticism for your response to an enormous ecological disaster?

One strategy adopted by BP has been to purchase the search term "oil spill" – a decision which has led to widespread criticism within the mainstream media.

Clicking on the sponsored link takes visitors to a "Gulf of Mexico Response" page which offers the latest news on the company's attempts to clean up the mess. 

There's no denying that this is a useful resource for people affected by the crisis, with regularly updated video and audio content - and contact details for all the agencies involved in the clean up process. And of course it's understandable that the company should seek to wrestle some control of the story back from a mainstream media keen to attack at any opportunity. However, the strategy appears to have backfired with the media already attacking a move which suggests that BP is more concerned about its public image than the urgent work it is facing. 

From a PR perspective it's safe to say that the Gulf of Mexico oil spill has presented some major challenges for BP. Tony Hayward certainly hasn't helped with his comments that he wants to get his life back. Equally, the company's decision to spend $50 million on an apologetic TV advertising campaign has been criticised at the highest levels with Barack Obama wading into the argument himself.

So what could BP have done differently? Search is of course a valuable tool in any marketer’s arsenal. Paid search in particular can be hugely useful in times of PR emergencies for quick, immediate, reactionary measures. However this has to be done in an integrated way as part of a reactive online PR programme that reassures groups online that the brand is doing the right thing and engaging directly with the key influencers.

One key error that BP has made is that the Gulf of Mexico Response page that the paid search ad directs users to focuses too strongly on creating the image of BP as the saviour when perhaps adopting the persona of the repentant sinner might have sat easier with the general public. 
 

BA provides a useful case study. In December 2009 the company bought the search term “BA strike” to provide searchers with an accurate, official response after 12,500 cabin crew threatened to go on strike for 12 days – you can read all about this in the “How to manage an online PR crisis” section of the IAB’s recent Search and Social Media report. BP’s case is of course incredibly complex and the battle to protect their reputation is sure to be a long one, but this could at least be a useful place to start.

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Online ads: bigger can be better

There has been much discussion behind-the-scenes of the marketing industry about new larger online display adverts – is bigger better? Not if it jeopardises user experience to SHOUT AT consumers, but yes when they are being used correctly. The Half-page Ad, the newest and largest UK standard, is around the size of two MPU ads stacked on top of each other and is slightly wider than its predecessor the skyscraper. I have a theory that it is the best online display format available today and I’ll explain why.



To me, display advertising should be treated as visual content – it should be relevant and interesting to the person viewing it. Above all it should be beautiful. If we assume that a display ad is actually just paid for visual content, then I want that content to be displayed in the best way possible. The Half-page Ad is better proportioned than most online ads. It’s wider, so you can fit better imagery into it at a size that can do the image justice. There’s a reason why Burberry have been using it to showcase their latest collections. The Half-page Ad represents a fabulously delicious new opportunity for advertisers to display their wares.

In the above Mercedes example the ad is almost exactly the same size as the image at the top of the content. If users expect images of this size in content - which they do these days because the internet is now a far more visual place - then an ad should be able to match it. Here the ad is clean, uses great photography and animation that wouldn’t be possible on a smaller ad. You can even include vertical video in the Half-page Ad with extra messaging around it in exactly the same way as outdoor digital (e.g. the displays on escalators) where both have no audio and both only have a small window of opportunity for people to see it. It would be bad practice to show someone a smaller image with squashed messaging. Out in the real world, agencies I’ve spoken to that have used the ad tell me they show strong uplift for brand campaigns.

So, why do some people have an issue with larger display formats? I don’t know, but my guess is that people still view online display ads as a direct response format like search ads. Online display is not search. Display ads are not always direct response. If you want direct response, it’s true, smaller ads can work – but the greatest use of display advertising is for delivering a brand message without the need for people to click through. I’m never going to click to buy a Mercedes online from seeing an ad, nor would I personally click to view the website immediately. In the same way I wouldn’t rush down to my local dealer from seeing a bus stop poster. The Mercedes ad certainly left an impression on me however by showing the car’s vertical flip doors in action. It is a cool car and something I may consider when I purchase a car one day – and that’s something I would never have seen properly in a smaller ad.

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"It is proportionate to focus on improving and supporting self-regulation"

So concluded the Office of Fair Trading’s market study into online targeted advertising and prices, published on 25 May. The 87 page report set out the OFT’s views on targeted advertising, including behavioural advertising, after a six month consultation with business, industry bodies (such as the IAB), consumer groups and other regulators, such as data protection authority, the Information Commissioner’s Office, and communications regulator Ofcom. The IAB welcomed the market study and there was a fair amount of balanced national media coverage such as in the Independent and the Guardian.

Facts about Advertising Using Games

Last night we held an interactive showcase for advertising using games platforms like consoles, mobiles, iPads and online social games. Plus exclusive hands on time with Sony's 3D gaming and Move motion control.



It was to launch the formation of our Games Steering Group (DoubleFusion, IGA Worldwide, IGN.com, EA, Microsoft, Sony PlayStation) and I created a short factsheet of some available gaming stats to handout. The contents of which are below. Hopefully they will be of use to a few BrandRepublic readers…

• - To date across Europe, there have been sales of 15.49m Microsoft XBox 360, 15.79m Sony PlayStation 3 consoles and 24.24m Sony PlayStation Portable consoles (VGChartz)
  
  
• - 6.9% of time spent online in the UK is spent playing games, surpassed only by social networking and email. An increase of 15% since 2007 (UKOM, 2010)
  
  

If all April 2010 UK Internet Time was condensed into one hour,
how many minutes would be spent on most heavily used sectors

• - Game console usage was up 21% in June 2009 over the previous year with gamers spending an average of 12.8 hours playing games in the month (Nielsen)
  
  
• - The global in-game advertising market is estimated to reach £698.6 million by 2014 (Screen Digest, 2009)
  
  
• - 72% of gamers recall seeing ads for brands in-game. In 2009 there was a 20% increase in average ad recall from the year before and the average brand recommendation lift scores were 29% ahead (Microsoft, 2009)
  
  
• - Percentage of females that have ever played games:
  
  
  • 96% of 8- to 12-year-olds
  • 86% of 13- to 19-year-olds
  • 76% of 20- to 34-year-olds
  • 67% of 35- to 49-year-olds
  • 43% of 50-plus females
    (TNS UK National Gamers Survey, 2009)
    
    
• - Percentage of males that have ever played games:
  
  
  • 100% of 8- to 12-year-olds
  • 97% of 13- to 19-year-olds
  • 83% of 20- to 34-year-olds
  • 77% of 35- to 49-year-olds
  • 41% of 50-plus males
    (TNS UK National Gamers Survey, 2009)
    
    

Time to play

If you don’t play games, you may not know that this week holds the biggest blockbuster release for years – yep, even bigger than Avatar - Red Dead Redemption. It’s a Western for the Playstation 3 and Xbox 360 built by the geniuses at Rockstar Games, responsible for the Grand Theft Auto series.



Whether you like games or not, if you’re an advertiser I would strongly recommend you take note because while you can't advertise in this particular game a huge tidal wave of people are now playing more games more often. According to DoubleFusion, a 2009 survey showed 73% of the UK population has played video games (source: National Gamers Survey, TNS & GameIndustry UK).

With the advent of social, mobile and online gaming EA are reporting that the number of women playing video games in the last 12 months (ages 25-29 yrs) has increased 17%. For 15-19 year olds, this number has increased by 15%. It’s not just big blockbuster games either, it’s the casual ‘dip in and out’ online games like Mini Clip and Playfish that are causing a major shift.

All of these stats have resulted in companies like P&G, T-Mobile, The Discovery Channel, Orange and many more using games for advertising. I was particularly encouraged by the announcement in last week’s NMA by Channel 4 that their education department is investing heavily in online and console gaming.

Increased audience is a compelling story, but what I’d really like everyone to understand is that people enjoy playing games, and when we play our attention is incredibly focussed. If you can get involved in the creation of games yourselves - in the right way - you can help position your brand at the heart of this attention and enjoyment.

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Please try again

As David Cameron stepped inside No 10 last night, the Labour Party website was unable to accept new members - and instead posted a message stating: "A record number of people are trying to join the Labour Party, please try again in five minutes."

Was this actually the case - or was it instead a quiet joke?

If it was a joke, perhaps Labour should have done more work like this in the run up to the Election.

Our recent report on the Digital Election showed that they lagged behind the other parties in key areas such as social media, search marketing and mobile communications. While it would be naive in the extreme to suggest that if they'd got all this right, Gordon Brown would still be in No 10, getting their online strategy right before the campaign kicked off certainly wouldn't have hurt.

If it wasn't a joke, and in fact the Labour party's site was simply over-capacity and unable to accept new voters at a crucial time...well...they clearly have a lot to learn.

If you'd like to read more about the parties' online performance in the run up to the Election, a free, downloadable copy of the IAB's Digital Election report is available at the IAB's website.

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We’ve no standards these days

Imagine Mrs Kellogg's. She's totally loaded, but remains dedicated to selling her cereals to the people of the world. To do this, she makes cardboard boxes with designs on them to stand out on shop shelves. Now imagine if Mrs Kellogg's went to Miss Tesco, Ms J Sainsbury and Dame Marks & Spencer asking them to stock her latest cereal on their shelves. Miss Tesco would love to stock her new cereal, but only if the box is 2cm shorter. Ms J Sainsbury and Dame Marks & Spencer will also gladly take the cereal, but they also request different sizes of box because they all think their size is the best.

It’s certainly possible for Mrs Kellogg's to do this, but she is rather busy and, quite frankly, has better things to be doing with her time than worrying about the shape of boxes. Particularly as each market across Europe has similar requests and she then has to think about different ways to transport the different size boxes. If she were to produce every different box it would lead to packaging her one cereal in at least 40 or more different boxes – and she has over thirty different types of cereal! Mrs Kellogg's is exasperated.



She thinks about choosing just one shop, but to maximise reach her cereal has to be on the shelves of all of them. In a bid to make her life a lot easier, Mrs Kellogg's hosts an afternoon tea party for all of the ladies and after much discussion, they agree on one size of box for all shops. Mrs Kellogg's is now extremely happy because she can display her new cereal in front of as many people as possible. Miss Tesco, Ms J Sainsbury and Dame Marks & Spencer are particularly happy because they receive money for every box of Mrs Kellogg's popular cereal sold in their store. What a rip roaring success!

Internet advertising in its many forms is exactly the same. There are thousands of different websites that sell advertising on their pages. The most successful websites for online advertising are search engines. They’re successful because: 1) search ads work 2) almost everyone uses search so advertisers can target every audience 3) there is only one ad format, so it’s incredibly easy and time efficient to use. Likewise, online display advertising works and everyone accesses websites with ads on, but I think it is suffering on ease and efficiency because of a lack of advertising standards.

Of course, search has it easy, there are only a tiny handful of search engines. For online display and video advertising there are hundreds of thousands of websites on offer and the types of adverts on each varies enormously. In the US, the market works together to establish standards to make it easier for the Mrs Kellogg's of the world to use the same advert across all of these sites without modifying the box size. The UK does the same, but there doesn’t seem to be the same appetite to develop new standards.

In particular, I believe that online video advertising and new online display formats are being held back significantly by a lack of standards across publishers. I’m ready and willing to help and, indeed, there are some knights in shining armour in the industry who are already helping to fix this problem. However, this is a problem that everyone in the industry needs to understand and help solve. If we can all get this right, we can continue to grow online display advertising and make it better for everyone.

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Broader industry support needed for behavioural advertising

Last week departing New Media Age (NMA) journalist Susie Bearn issued a ‘call to action’ for more players within the digital media sector to sign up to the IAB’s Good Practice Principles on behavioural advertising to give the initiative even greater credibility.

She’s absolutely right and the IAB agrees and supports this call. By getting serious, businesses will demonstrate to all those around them that they are committed to providing internet users with greater transparency as well as offering enhanced choice and control. And the burden should not just fall upon advertising networks and technology companies, who are already stepping up to the challenge. Agencies also need to play their part and it’s not the first time the IAB has advocated this. 

The Good Practice Principles are a stepping stone towards the goal of delivering trust in this practice: amongst internet users, amongst regulators and policy-makers (both in the UK and within the EU) and within the wider digital advertising ecosystem. Only by doing so will business and the broader digital economy realise and reap the benefits of behavioural advertising. So whilst the politicians unravel the indecisiveness of the UK General Election, we have a very clear message: get involved.

www.youronlinechoices.co.uk

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