Behavioural targeting has always been a hot topic as marketers constantly strive to understand exactly who’s interested in their product and exactly when they’re ready to buy.

Innovations in technology and onsite analytics allow marketers to tailor their online ads based on consumers’ behaviour. However, critics of behavioral advertising believe it is invasive and unethical and can become quite worrying for consumers who believe advertisers have their personal data.

However, if privacy issues can be addressed correctly, targeting provides benefits for consumers, advertisers, and publishers.

According to the Office of Fair Trading, revenue from online behavioral advertising is currently between £64m and £95m, and it looks to rise significantly in the future. However, as consumer information is collected through ‘cookie’ files, it is a topic of much debate and regulatory conversation.

I would like to take a minute to break it down a little, simplify it, and highlight the benefits to all: 

Marketers benefit from knowing the buying propensity of each consumer and being able to retarget based on:

• Pages visited.
• Time spent on site.
• Recent visits.
• Frequency of visits.
• Products purchased/preference.

Through segmenting interest into groups based on information gathered from activity and search data over a specific time frame (recent = 30-45 days), behavioural targeting offers a great way of qualifying interest and ensuring relevant ad placement, and some say it can increase conversion rates by up to 500%.

If a consumer is interested in cars , then you will be more inclined to click on an advert that offers you something about cars than on one promising you discounted tickets for the theatre. Surely the consumer would want to see this?

Behavioral targeting can deliver as many impressions as possible directly to the advertisers target audience, thereby reducing campaign wastage. It can also help build brand awareness and allow more relevant ‘one to one’ messaging and engagement

For the publisher, behavioural advertising allows them to offer an enhanced offering that can provide their advertisers with far greater ROI, while the consumer benefits since the advertising is more relevant to their interests and need with advertising served via anonymous cookie-based and not personal data. 

Key to sector growth

Recently, Jim Sterne wrote a great article about personalisation v privacy which shows how useful targeted advertising can be to consumers. The key to future success of behavioural advertising really starts with the consumer. Marketers and advertisers need to ensure;

  • The consumer feels comfortable and is offered an opt-out. Advertisers need to ensure consumers are educated on all aspects of cookie tracking and privacy settings and that all advertisers follow good practice guidelines. 
  • The consumer also needs to see the benefit of relevant advertising based on their interests and needs, and that advertising is purely served via anonymous cookie-based, rather than personal, data.

Given the media hype and threat of regulation, advertisers are now beginning to engage more with consumers. The reality is that if advertising didn’t exist, many websites would not exist. Advertisers ask: is that good for the consumer? 

Many advertisers are testing new systems that enable consumers to opt out of targeting advertising. For example -The New York Times reported that Power I is designed to make targeted advertising more transparent and allows consumers to see more information about the ad they have been served. It tells the consumer why they have being targeted and the data used. It then gives consumers an option to opt out of future ads(note – from that advertiser only).

Don’t believe all the media hype, if privacy concerns are addressed correctly and the consumer can see the benefit of relevant advertising then this market is set to soar.