Let’s begin with a profile of a customer who received an email from a large retailer.

Name: John S
Gender: Male
Age Range: 40 -50
Relationship: Married
Location: Seattle, WA
Profession: Executive in an Interactive and Technology Company
Hobbies: Golf, Madden 09,
Shopping Habits: Shops at Nordstorms.com, mostly interested in shoes and have borught a lot of them from Nordstorm.com. Also buys shirts, trousers and other male clothing items. Loyal customer at Nordstrom.com and Nordstrom for many years. Has an account online and login quite often when browsing.

From what it sounds like he is a perfect customer for any male clsothing items that Nordstorm wants to sell. He will be very keen to look at Nordstrom promotions. He has opted-in for an email from Nordstrom.

Last week, John and I were talking about e-retailers, targeting (in particular Behavioral Targeting), personalization and product recommendations online. During our discussion he said “you have to see an email that I received from Nordstorm”. He forwarded me the email which is shown below

Now my questions to Nordstrom or other etailers who are sending similar emails is, “Why would you do that?” You have so much information on your customers (John in this case) why not use that information to power your emails?

John was not annoyed with Nordstrom for this email(he is a huge fan of Nordstrom. Good for the Brand) but he was disappointed. He would probably have bought something if Nordstrom had sent something relevant to him in that email.

Here is a customer waiting to convert and you are disappointing him with irrelevant emails? Why?

Don’t you want happy customers who are ready to open their wallet and give you money? Don’t waste your and his time with irrelevant emails send them relevant emails.

Here are few ways to create relevancy in emails

1. Use his browsing history to look at what has been looking at but has not bought yet – Target the correct promotion
2. Use his past email click-though behavior to determine what might interest him
3. Use his checkout funnel abandonment history to determine what to send in an email
4. Use his past purchase history and make proper recommendations
5. Use the frequency and recency of his visits to the site to determine when to send him a coupon and type of promotion
6. If you do feel you have to send something unrelated to persons interest (e.g. provide him an opportunity to see what else you sell maybe lure him into buying something he might not have considered) then send it along with something relevant to him. E.g. send discount on women apparel along with some discount for men stuff
7. If you don’t have anything relevant to send then don’t send an email. Consumers are bombarded with irrelevant emails every day, you need to stand out and make your email count so don’t send anything irrelevant

Sending relevant emails is not rocket science. Most of the email tools/services have a way to send highly customized emails. You just have to explore them.

Do you have examples of irrelevant emails or relevant emails that you would like to share? Send them to me.

Comments? Questions?

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Site: AnilBatra.com

Twitter: http://www.twitter.com/anilbatra

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]]> http://behavioraltargeting.wordpress.com/2008/10/31/relevancy-matters-in-email-marketing/feed/ 0 akbatra http://behavioraltargeting.wordpress.com/2008/10/07/behavioral-targeting-resources-ask-anil-batra/ http://behavioraltargeting.wordpress.com/2008/10/07/behavioral-targeting-resources-ask-anil-batra/#comments Tue, 07 Oct 2008 01:07:16 +0000 akbatra http://behavioraltargeting.wordpress.com/?p=79 ]]> A friend of mine and a regular reader of my blog asked me about the resources that are available for someone to learn about Behavioral Targeting. Since I get a lot of questions via emails, I thought that I should answer it via a blog post so that others, who might be interested in the same topic, can benefit from it as well.

With this post I am also officially starting a column called “Ask Anil Batra”. Please send me your question on Web Analytics and Behavioral Targeting and I will try to answer them in my blog posts.

Now back to answering the question. Here is a list of Behavioral Targeting Resources that I know of:

• Media Post’s Behavioral Insider – great articles. I read it regularly
• ClickZ – Behavioral Marketing Articles – Another great resource that I read.
• Behavioral Targeting – Specific Media Site
• How To Target – A Revenue Science Site
• Fishing From Barrel: Only Book on Behavioral Targeting
• My Blog – I write extensively about Behavioral Targeting on this blog

Behavioral Targeting vendors have a lot of information and whitepapers on their own sites. I will do repost in future with a list of vendors and any whitepapers that might be of value. If you are a Behavioral Targeting vendor and would like to be included in this list then please contact me.

If you know of a resource on Behavioral Targeting then please leave me a comment or email it to me and I will add it in my future post.

Got a question on Web Analytics, Optimization or Behavioral Targeting? Send it to me at batraonline (at) gmail.com.

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Site: AnilBatra.com
Twitter: http://www.twitter.com/anilbatra
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New Position
(Web Sales) Conversion Marketing Manager at Hewlett Packard (American Fork, UT)

Now, it’s Gmail’s turn.

Users of Gmail are used to seeing text ads on the side and top of their Gmail mailbox. These text ads are based on the content of the email that a user is reading or gets. I was surprised when I recently saw an ad that was neither relevant to the emails I get nor relevant to my Gmail profile. It was however relevant to some of the search made in past by me on Google and relevant to me (maybe), which Google could have guessed from my name (maybe).

The ad I saw was from a Travel Company that specializes in tickets to India, and interestingly the ad was in my native language “Hindi”. Yes that’s right, the ad was in “Hindi”. My Gmail account, on which I got this ad, is for my semi-business use and never get any personal emails other than from my wife, who uses SeattleIndian.com email address. But I have never got an email in “Hindi” in this account. My conclusion is that Google pulled my name, Web history from Google Account (that includes Google Searches, none of which resulted in me viewing “Hindi” pages) and SeattleIndian.com email address to conclude that I might be interested in an ad from an Indian Travel Agency. None of my searches or my emails will indicate that I know Hindi so it was purely a speculation by the Google Advertiser or Google to think that I knew Hindi.

Here is the ad that I saw

Have you seen something similar? Comments? Questions?

Today visitors, when they visit a site participating in a behavioral targeting network, are automatically opted-in to Behavioral Targeting. The consent to participate in Behavioral Targeting is mentioned in privacy policy of the site, which most of the people don’t read (when was the last time you read privacy policy of a site), and also visitors do not have choice if they want to use the site.
Even though most of the time tracking is done anonymously, using a third party anonymous cookie, Behavioral Targeting has raised privacy concerns. Most of the time these privacy concerns are unfound but still there are chances when it they can become an issue.

To ease consumers concerns and give them control over their tracking, Network Advertising Initiate (NAI) has developed an Opt-out Tool. This tool allows consumers to see what Advertising networks have dropped cookie on their computer and hence are tracking their behavior. If a person does not want any network(s) to track his/her behavior the visitor can “opt out” of the network using this tool.
Opting out of a network does not mean a visitor will no longer receive online advertising. It does mean that the network from which a visitor opted out will no longer deliver ads based on the visitor’s behavior and/or preferences.
One caveat is that opt-out (using this tool) is based on third party cookies. What that means is that third party cookies are dropped on a visitor’s computer from the networks that he/she opt-outs from. When the visitor visits a site that is part of the network, network code reads the cookies and if it finds an opt-out cookie on the computer then if does not track or show targeted (behavioral) ads. If the visitor deletes the cookie or uses a software which deletes the cookies then visitor will be automatically opted-in again and he/she will have to repeat the process of opting out.
I believe that NAI should push this initiative even further and allow consumers to opt-out directly from the ads that are being served based on behavioral data or from the sites where the data is being collected. I am predicting that this year we might see a push in that direction. I also believe there will be opt-in networks instead of opt-outs (I wrote about my proposed solution when discussingGoogle DoubleClick privacy concerns, networks that will allow more control to visitors and reward users for participating in these networks (something similar to MyPoints, which asked for your preferences and then emailed you offers or ads based on those preferences and then rewarded you for clicking on those email offers).
Here are the networks that are part of NAI (I will write about these networks in future articles).

aCerno
Advertising.com
AlmondNet
Atlas
DoubleClick
Revenue Science
Safecount
SpecificMEDIA
24/7 Real Media
[x+1] (formerly Poindexter Systems)
Yahoo! Ad Network
TACODA Audience Networks

Here is the screenshot of the tool.
To use the tool visit NAI Website.

I tested it on two computers and was surprised to find out that I did not have network cookies from DoubleClick and Yahoo ad networks on either of the computers. I don’t believe that. So I don’t think the tool is fully functional, I will test various network in few days and report back if I find anything odd. For now, I have left all my cookies as it is because I find the value in behaviorally targeted ads, I will only opt-out for testing purposes. When you guys try can you let me know if you are seeing the same thing?

1. Offsite Analytics – With proliferation of Widgets and Rich Media ads a need to measure, understand and optimize the user interaction with widgets and Rich Media ads will become important. Web Analytics will include offsite measurements i.e. user interactions with widgets and Rich Media Ads
2. Google Analytics – Google Analytics will mature further and start taking customers from other analytics tools like Omniture, WebTrends, Clicktracks etc. The configuration will become little complicated (and hence need for Google Analytics Expertise will grow) and Google will also expose more APIs to allow companies to pull and merge different kinds of data with Web Analytics Data.
3. Mobile Analytics – Mobile sites and mobile advertisings gains momentum. Mobile Analytics will be become a requirement to understand how the sites and advertising is performing. Currently you can either use log files, WAP gateway logs if you are one of the mobile carriers (this is what I did back in 2001 -2002) or use services from Amethon. This year we will see more players in mobile Analytics. The reporting will become better than what has been offered to date.
4. Online and Offline Data Integration – A need for integrating offline data and web analytics data will become a priority. ZeroDash1 founders saw this need in the market and hence started this company. More companies will push in this direction including web analytics vendors. Oracle bought a Web Analytics companies (I predicted this also). I can see them integrating CRM and Web Analytics into one package.
5. Behavioral Targeting – Behavioral Targeting will continue to grow this year, however, there will be greater push for protecting consumer privacy. The privacy concerns will result in two things:
   1. Clear instructions (or links) on Behaviorally Targeted Ads that will allow behaviorally targeted visitors to opt-out of Behaviorally Targeted advertising
   2. Opt-in system – Some networks (maybe new ones) will move towards opt-in rather than opt-out (I favor opt-in over opt-out as I wrote in past. So I am making this prediction that this year networks will pay attention to it). A new types of networks or services might come up which will allow users to be an active participant in BT and control who can use their online behavioral data and how they can use it.

What do you think?

What is Affiliate Marketing?

Affiliate Marketing is way for advertisers to reach potential customers and only pay when a visitor takes some predefined action. Predefined actions range from a sale to registration. Recently Pay Per Click has also been added to affiliate programs. Generally, the website (publisher) places an advertisements on their site and when a predefined action results by a visitors referred (clicked) by that ad, the advertiser pays the publisher a % or a fixed amount. I won’t go into further details of affiliate marketing but you get the idea.

As you know now that one of the major benefits of Affiliate programs is that an advertiser gets an inventory on publisher’s site without paying anything. Advertiser only pays when a visitor becomes a lead or a customer. This is like sales people on commission only program.

However there is even bigger benefit than just getting free inventory. The ability to put an ad serving (and tracking) code on these affiliate sites (publishers). Just think about how many sites Amazon, eBay, commission junction, linkshare etc. have their codes on. Amazon was the one of the early advertiser who realized the power of Affiliate programs. Google, not matter how you look at it is also a type of affiliate program, in most case advertisers get free inventory and only pay when a click happens (and now Google has pay-per-action program which is true affiliate program).

The widespread tracking code on the internet provides a huge opportunity for affiliate networks and advertisers (like eBay, Amazon) to engage in behavioral targeting and reach potential customer with the right message at the right time.
Let’s take a look at a scenario to further understand how this can work.
A user visits eBay and looks at certain products and bids on a camera but lost the bid. Next day eBay gets another seller who is selling the same camera. How can eBay reach the user who lost the bid? Well one way is they can send her an email (She might not be actively checking my email). Second is tell the about that camera when she come back to eBay (that might be too late). Third is they can use their affiliate site to put that camera offer right in front of her if she happens to visit any of the affiliate site (and there are a lot of them). She has shown interest in the camera so why not use your affiliate code to put the right offer in front of her. The code is right there make use of it. Some might argue this is crossing the privacy line but that is whole another issue to discuss.
Amazon already does similar targeting by its Omakase links but it is not true behavioral targeting. They use the keywords or browsing history which goes back since they day they were born. I see offers from Amazon that are not even relevant to me anymore, they were at one time but Amazon still thinks I am interested even though I have not clicked on those products in years.

Affiliate networks like Commission Junction and Link Share are in great position (eBay uses Commission Junction). They know what kind of sites a visitor (or customer) visits, what kind of products/offers he/she is interested in by looking at their click or purchase behavior. Can’t they just automatically put offer s/products in front of customers?

The way most of the affiliate networks work today is not very efficient for any of the parties involved. They need to step it up a bit. Here are my thoughts on all parties involved how Behavioral Targeting (BT) can help them.

Publishers: A publisher has to decide what advertisers they want to sign up for, this is their guess on what will work. I have spent months trying to figure out what will work for my customers. Also then the link generation process is so difficult. Say a publishers sign up as an affiliate for Resaturant.com (check out SeattleIndian.com, it has restaurant.com banner), now the publisher has to go find the products that are relevant to their customers if they want to target with right banners. In this case maybe it is restaurants in Seattle. It is such a pain that majority of publishers don’t want to deal with it and just put a generic banner. Won’t it be nice if CJ or Restaurant.com in this case was able to put the right offer based on Geography and other browsing behaviors on either CJ network or Restaurant.com site itself?

Customers (visitors): Customers (Visitors) don’t have time, they will only click on ad which will be relevant to them. A generic message from Resturant.com or eBay or Amazon is not enough. Show them a message which will make them click right away. If a customer has already been to Restaurant.com and looked for Indian Restaurants in Seattle and now when the customer is in Seattle (Geo location) surfing on this affiliate site, why show her a generic message? Why not show her offers for Indian Restaurants?

Advertisers: Even if advertisers are getting free inventory now, it is not going to last. Inventory is limited, publishers are going to replace their banner with something that will make them money (AdSense has replaced several affiliates). So grab this opportunity. Put relevant message, gone are the days when generic message would have worked (did they ever worked though). Use the browsing behavior on your site (or a behavioral ad network, your affiliate network will have to offer behavioral targeting soon) to target the right messages.

Affiliate Networks: Why are they still operating using the old model where they make the publisher s guess what products or offers will work for them (Google is following this model too with their pay-per-action model). Why can’t you let publisher put some generic code on their site and then serve ads based on user behaviors? I have seen a lot ads sitting on a publisher site not generating any sales, few clicks, who is benefitting from all this? Not the affiliate network. Not the publisher. Advertiser? May be. Visitor? May be. Now if you had placed a right message (determined from user past behavior) then chances are that all of the parties involved will benefit. It is worth trying. Test it. Use the data you collect, the data from advertisers’ site, the data from publishers’ site. It is not going to be easy but it is doable. Acquire a behavioral targeting company, use their technology and network too.

Affiliate marketers and networks have a huge opportunity to cash in using Behavioral Targeting. They just have to move fast.

Comments, Questions?

Here are some more posts on Behavioral Targeting.

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According to the article:

“Demands of these groups would Hinder Marketers’ Behavioral-Targeting Practices Online.

…However, consumer-privacy advocates charge that collecting such information in order to target ads creates “a privacy imbalance that has deprived Americans of the right to control their personal information.”

So my questions to these groups are:

1. If consumer don’t like the irrelevant ads but still prefer free ad-supported content to paid ad-free content, how are these groups going to provide that?
2. How are they going to create Do Not Target list without (Personally Identifiable Information) PII information?
   1. One solution is used by NAI, that is to drop a cookie to indicate that user should not be tracked. But if a user deletes NAI cookie then the user is back in “Do-Track” list since most of the targeting solutions are “Opt-Out’ systems (user is opted-in by default).
   2. Another solution is to create a universal cookie that might be able to get by without any PII information but who is going to maintain that? Google? Microsoft? Yahoo?(Just Kidding)
3. Is anonymous tracking really a privacy concern? Do consumers really care about Privacy? Or is this mostly a concern of these groups? Anonymous cookie tracking is still better than what these users provide online to the social networking sites. Look at facebook.com, myspace.com where users voluntarily provide information everyday about their whereabouts, likes, dislikes, friends etc.

In my previous posts concerning privacy I proposed that Behavioral Targeting should be “Opt-In” instead of “Opt-out”, let the users make a call if they would like to be tracked to see more relevant ads.

Here is what wrote
“I believe that if consumers are provided proper education (I will write about consumer benefits in one of my future posts) than they can in fact 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.”

Originally posted at http://webanalysis.blogspot.com/2007/10/do-not-track-list-attempt-to-kill.html

Well, since then we have seen consolidation in this market earlier this year, Google-Doubleclick, MSN-Aquantive, Yahoo-Rightmedia now the latest is AOL-Tacoda.
According to NYPost’s article Aol has an Eye on Your Business, AOL is moving into the behavorial-targeting ad market with a deal to purchase Behavioral Targeting Firm Tacoda.

“Tacoda, which will operate as a wholly owned AOL subsidiary, is one of several online ad firms that use “behavioral targeting” techniques to track Web surfers’ habits. Through its so-called “Audience Network,” Tacoda helps marketers tailor ads to individual users for such things as cars or computer equipment. “
“…While not referring to any company in particular, [Andy] Falco did concede to The Post that Tacoda “did have other choices, but they choose to come to AOL.”

I am sure this puts Revenue Science (Tacoda’s biggest rival) in sort of an odd position because AOL was one of their biggest customers and were probably competing with Tocoda to be acquired by AOL.

Next acquisition target: Revenue Science. We will have to wait and see who buys them? Any takers? Valueclick?

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 Originally posted at http://webanalysis.blogspot.com/2007/07/consolidation-in-behavioral-targeting.html

According to NYtimes, this is how Yahoo’s new system works: the advertiser (or its agency) would provide Yahoo with the components of its display ads — including the logos, tag lines and images. The retailer would share information from its inventory databases that track the items on the shelves in each of its stores. Next, Yahoo would combine that data with the information it has about its users’ demographics and actions online to create a product-specific advertisement.

According to the article: “For airlines, SmartAds uses Yahoo’s information about its Web surfers to create display advertisements for each person that feature ticket offers with actual prices listed. In time, Yahoo plans to offer rich media advertisements where users can buy the ticket at that price right within the ad unit, rather than having to click through to another Web site.”

Web Analysts, here is something to start thinking about – offsite transactions. User will never come to you site (your web analytics tools, omniture or webtrends won’t even see the visitor), any web analytics tracking embedded within Rich Media will possibly be Yahoo’s.

Dear Publishers, this will allow yahoo to build richer set of data, advertisers make sure you own that information and not used by yahoo to empower your competitors or against you e.g. raise the CMP or CPC for you because you have higher conversion. I don’t think that should be the case but there is always a possibility.

Side Note: According to Reuters “SmartAds will operate on Yahoo’s network of Web sites as well as in its advertising partnerships with eBay Inc., major U.S. newspaper publishers and cable operator Comcast Corp.”. Not sure if eBay, major newspapers and Comcast are just the publishers of advertising or will actually be pooling in user behaviors. If these publishers also allow yahoo to create better understanding of users based on their behavior on their own site, yahoo will have even wider reach and better targets. Example: A user comes to ebay looks at some cars and then browses over to a newspaper site, without even clicking on a single link on the newspaper site, Yahoo (network owner) will know this is somebody who is interested in cars. By pooling in behaviors eBay will be able to generate extra revenue stream and the newspaper will have a better target and hence higher CPM.

Originally posted on http://webanalysis.blogspot.com/2007/07/yahoo-gets-smarter-with-smartads.html

Here is what Bill Said “In terms of working with an advertiser or agency, the method is to start with their conception of what an ideal consumer for their product or brand would be, and then to locate the audience whose patterns of behavior and passions (as identified by their patterns of engagement) most clearly connect to that model. We call it ‘audience discovery.’”

I agree with Bill, the better you understand the consumers behavior (now called passion) the better targets you will you. That’s the whole premise of Behavioral Targeting to begin with. You start with a very basic set of behavior e.g. somebody who visits a “Auto Section” on a site or an “Auto Site” in the network. The refine your segment by adding other criteria such as a user who then visits say “baby cloths” site, now this user might be somebody who is probably expecting a kid etc. So could be a better target for a minivan. The more behavioral criteria you add the better targets you get.

However the more granular you get with your segments the reach becomes a problem. Yes there will be quality but reach might not be enough to justify the cost and efforts of reaching these targets. For publishers this also causes inventory management issues. This is the reasons why BT providers created predefined segments.

Read my previous posts on Behavioral Targeting

Origninally posted on http://webanalysis.blogspot.com/2007/06/audience-discovery-targeting-passions.html