Google, Yahoo, Microsoft and Cookies

Today there was an article on ZDNET blog about how Google/Doublelclick, Yahoo/RightMedia and Microsoft/aQuantive deals is about cookies more than anything else.

I agree with the author of this article that these acquisition are not about ad serving technology but about user data and reach. I have written in my past article about how these acquisitions by these three giants were a huge steps towards building behavioral targeting networks.

The rich set of user data that these companies will be able to gather by these acquisitions is very valuable. All of these companies had cash to hire smart people and build the ad serving technology for a fraction of what they paid for acquisitions. So it is not about technology. What they could not have done on their own was the reach and rich user data. The only way to gather that kind of information was to acquire the companies which have those.

So why do they need that user data? One of the issues with advertising is that by placing contextual ads advertisers waste lots of impression because they reach a lot of people who are not even interested in their offers or products. This rich user data (tied via cookie) will provide Google, Microsoft and Yahoo understanding of which users could potentially be interested in offers/products of an advertiser. Historical user data will allow them to understand what kind of users have responded to what kind of offers/products in past. The new acquisition will also allow them to reach all those user which were earlier not in their network plus provide them more data. This will allow them to target the ads to right set of users, users who are most likely to click on an ad and convert (buy, register etc.). By generating higher click-thorough and conversion they can command premium from advertisers. Everybody benefits from this, publishers can sell their inventory for a premium, advertisers will reach right set of customers and consumers will get the offers and products they care about. The three giant (Google, Microsoft and Yahoo) make money by providing this rich data and hence taking their cut from publishers (in many cases they will also act as publishers).

Some might argue that cookie deletion will cause a problem in aggregating the past user histories. I agree that cookie deletion is an issue but all these companies have some way for user to login or provide their real information (gmail, hotmail, yahoo mail, google checkout, toolbars, messengers etc.) which can help them tie all the cookies together. I will blog about this more in my future article.

Another issue raised by this article was privacy. I have written a lot about this in past, here is link to my past post which talks about this issue Behavioral Targeting: Audience Of One.

Behavioral Targeting will become a norm (it already is) and these three giants will own (already do) a significant portion of that user data that will make it possible.

Here are my other articles on Behavioral Targeting

Originally posted at http://webanalysis.blogspot.com/2007/05/google-yahoo-and-microsoft-and-cookies.html

Behavioral Targeting: Audience of One

This morning Washington past had an article titled “Web Ads with An Audience of One” discussing the growing use of Behavioral Targeting.

I have been writing about
Behavioral Targeting since I started this blog and have been predicting growth of behavioral targeting. MSFT/aQuantive deal did not come a s a surprise to me, I expected it. Behavioral Targeting is going to be very prevalent especially now when all three MSFT, Google and Yahoo have built their capabilities are building them.

This article resurfaces the privacy concerns, as I wrote in my article Google Doubleclick Deal concerns Privacy Advocates the best way to deal with privacy is to move from opt-out to opt-in model.

….“I believe that if consumers are provided proper education (I will write about consumer benefits in one of my future posts) than they can infect benefit from Behavioral Targeting. It will be a win-win situation for all the parties involved. Proper education and disclosures by advertisers, publishers and networks will ease the concerns regarding Behavioral Targeting. Consumers have the right to opt out of Behavioral Targeting but what is lacking is proper education on how to do so. The networks currently opt-in users by default; however, in my opinion the proper process should be opt-out by default and opt-in if user chooses to opt-in, just like we do for emails and newsletters. This process will move the burden from users to the advertisers, publishers and networks.

In short run this could result in a lower reach for BT providers. But if the benefits to consumers are properly stated then most of the consumers will be willing to participate. If you (network or advertiser) tell a consumer that he/she does not need to go looking for deals or offers of products/services that he/she is in the market for, these deals/offers will be provided to him/her based on her online behavior no matter where in the network she is in, I think consumer will love it. If a consumer knows the process and she knows that she is willingly participating in the BT, the click-through rate on the ads will be higher too. Why force users into Behavioral Targeting and raise privacy concerns when you can offer them what they want (when they want) and make them your raving fans.

This article gives an example from DrivePM where a user who visits a hotel chain site but does not complete the booking can be reached at later point in time but this time the user gets a 10% off coupon as an incentive to complete the booking. Knowing the benefit won’t users allow networks to track them? I am sure those who see the value in this 10% will surely do. As I said above give users what they want and they will give you what you want. If users know that they can have offers tailored to their needs by just letting a network track them, chances are very good that users will let them do it. Users sign up for grocery card rewards program just to get few cents off then how is it different online? Let users decide what and how they want you to track.

One another note: I am puzzled by the quote from Curt Viebranz of Tacoda “…….. we’re literally collecting 10 Billion behaviors a day”. In my article titled Calculating Behaviors on your Site I questioned a similar quote from Revenue Science. Can somebody from Tacoda or Revenue Science please clarify how you calculate behaviors or quit using such meaningless stats.

 Originally posted at http://webanalysis.blogspot.com/2007/05/behavioral-targeting-audience-of-one.html

Future of small Behavioral Targeting Networks is grim

With Google, MSFT and Yahoo buying Doubleclick, Aquantive and RightMedia receptively and more acquisitions coming in near future, seems like these giants will own the online advertising space. Most of the acquired or acquirers have behavioral targeting capabilities and together they broaden their reach and strengthen their capabilities. (Check out my other posts on the same subject
Behavioral Targeting Moves by Yahoo and Google and Google and Behavioral Targeting) With such large networks in the market does it make sense to have standalone behavioral ad networks such as Revenue Science Tacoda? These networks don’t even have their own ad serving system they just provide the technology to identify segments and then rely on other ad servers like double click or atlas to serve behaviorally targeted ads. Google/Docublick, Yahoo/RightMedia and Microsoft/Aquantive all have or are building behavioral targeting capabilities (technology) plus they have the reach.

I believe Behavioral Targeting will become important but advertisers are long ways out from just relying on behavioral targeting. Behavioral Targeting is one part of the whole targeting mix. With Google, Yahoo and MSFT with their vast reach further strengthened by these acquisition do not need smaller behavioral targeting networks (with limited reach) when they can do it own their own. Advertisers/Agencies also don’t need to worry about several smaller networks when they can use one of the exiting ones such as Google, Yahoo or Microsoft.

What do you think?

Originally posted on : http://webanalysis.blogspot.com/2007/05/future-of-small-behavioral-targeting.html

Behavioral Targeting Moves by Yahoo and Google

A recent article by Brandweek, talks about how Yahoo is betting big on Behavioral Targeting.
Yahoo has been testing its BT like targeting since 2003 or so. I am from India but has been living in US for years, I signed up for my yahoo account in US. Sometime around 2003 when I logged out of my yahoo email, yahoo served me an ad related to an Indian company. I don’t remember explicitly telling yahoo that I was from India. I asked my co-worker (sitting next to me and who was not of Indian origin) to browse to the same location but she did not get the same ad. My thinking at that time was that that they were somehow reading the content of my emails (just like gmail), since I didn’t remember using yahoo search engine to find that content related to India, but I am not 100% sure though) and serving ads based on it.

According to this Brandweek article, critics say behavioral targeting is an invasion of privacy. Jeffrey Chester, CDD founder and executive director said he has no problem with behavioral targeting if advertisers disclose to consumers that they are tracking information. “They need to fully disclose and get permission, but they’re afraid to do it,” Chester said. I am not a critic of BT but I agree with Chester as I wrote in my posting on Google and Doubleclick privacy concerns.
Yahoo! rep Dina Freeman said the company protects its users’ privacy. “It’s anonymous. It’s never tied to your name,” she said. “Consumers in general are coming around to the fact that they like the relevancy.”

I agree with the above statement but let’s disclose this to consumers so that everybody can feel comfortable.

Google on the other hand has been saying that it won’t consider behavioral targeting. Even though Google is resisting Behavioral Targeting so far but a lot of people (including me) are predicting that Google will soon get into Behavioral Targeting. According to Brandweek article, however, now Google is saying they won’t consider behavioral targeting without getting consumers’ approval. So they are thinking about it too if they get consumer approval. Richard Holden, director of product management at Google says “We’re not opposed to it in principle, if it means showing fewer ads but ones that are more relevant.” Yes, Behavioral Targeting is about showing relevant ads, so when can we expect first BT Targeted ads on Google network?

Originally posted at http://webanalysis.blogspot.com/2007/04/behavioral-targeting-moves-by-yahoo-and.html

Google Web History: Google and Behavioral Targeting – The Beginning

Google launched a new service called
Google Web History This service will allow users to keep an archive of their web browsing history. The service will also allow integrated web and search history to personalize results based on previous search and viewing patterns.
This service requires a Google account and the Google Toolbar, and users will be able to access their histories from any computer with the service enabled.
As I have been talking about Google and Behavioral Targeting, this is one of the steps towards that goal. Google will track everything you do (of course with your consent) and then in near future will show you targeting ads based on this information.
Side Note: The most interesting thing to watch will be the effect on organic search listings. This is the free source of traffic (sort of free) that a lot of sites have become dependent on but with all the personalization they are bound to get hit.
To ease the privacy, this service is not enabled by default. It also requires PageRank feature in Google Toolbar to be manually enabled. Also, there is an easy way to remove items from you history, however not sure if Google will still keep those in their logs to understand a users behavior.
Giving user an option to opt-in instead of opt-out is the right approach to Personalization and Behavioral Targeting. I believe if you show the users the value and benefits for targeting and let them make the choice then you will create loyal customers and won’t have to deal with privacy backlash.
Stay tuned for more data integration news from Google, this is just the beginning.
I just enabled this services so am going to take it for test drive.

Originally posted on http://webanalysis.blogspot.com/2007/04/google-web-history-google-and.html