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It was all about data at the Digiday conference in New York today. Marketers had converged to discuss the future of advertising agencies, behavioral targeting, and ad networks, and were probably relieved to hear reiterations that their collective demise had been overstated.

All three topics are constantly on the precipice of being verbally written off. There's talk of Google and ad networks killing off ad agencies, privacy concerns killing the practice of behavioral targeting, and ad networks cutting off air to one other.

According to the panelists, ad networks are not going to take over the job of ad agencies. But in the future, ad agencies will focus more on creative and less on data mining or the kind of sales that ad networks do better.

"Media agencies are never going to know data the way data companies know data," said Steven Faufman of Media Math.

As for the perils of behavioral targeting, BusinessWeek writer and Numerati author Stephen Baker thinks that many of the fears about data mining are overly exaggerated. "It's all about marketing," he says. "If you start talking about targeting, a lot of people feel violated. If you talk about customized service, they feel rich."

And Mark Zagorski, chief revenue officer at eXelate, is not convinced by predictions of ad network dropoff. There area currently over 600 networks in the space, and he says that he hears an analyst every week claim that there will be a culling of ad networks leaving only 100 the following week. While that shake out has yet to come to fruition, Zagorski notes that the way advertising gets sold will continue to evolve. "As media gets more fragmented, he says, "It becomes more about buying an audience than buying specific media."

For publishers, the value of their audience and their ability to deliver that group to advertisers will become a premium commodity. As inventory grows and demand cannot keep up, publishers will need to focus on delivering users to advertisers and keeping them coming back for more. 

Baker says that the online future really hinges on trusted data relationships. "Companies in the coming years are going to have to promote themselves as trustworthy data partners." The great divide then will be between a few trusted parties and everyone else, who will look like spammers. 

Advertisers and publishers are increasingly dependent on the data that they cull from users and their habits online. But while the way they use that information has been plagued with accusations of privacy violations, behavioral targeting isn't going anywhere. Online habits are simply too important to publishers and advertisers online.

According to Forrester, 50% of online marketers prefer behavioral targeting whenever possible. The trick of course, is how you procure and use that data. Even culling the right data isn't enough. "You've got to give the right data to the right person," says Darren Herman, head of digital media at Media Kitchen.

Where to get user data and how to use it are areas still up for debate, and the space between objective data and how it gets interpreted has left room for many companies to pop up in the ad selling space. Because online advertising is emminently trackable, the problems that lie ahead for publishers selling inventory has more to do with implementing data than culling it.

We need to focus on "mining that data we're already sitting on," says Herman. "Most agencies don't have the infrastructure to do that. But many people are building that now."

Whoever figures out the best ways to sort online user data will be taking that answer to the bank. But Jim Keyt, Digital Marketing Services of Unilever, summed up what advertisers are looking for most succinctly: "Don't give me data, give me answers."

Meghan Keane

Published 8 June, 2009 by Meghan Keane

Based in New York, Meghan Keane is US Editor of Econsultancy. You can follow her on Twitter: @keanesian.

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Comments (2)

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Darren Herman

Thanks for the recap of today's Digiday.

We need to stress that there is an abundance of data and different people look at data differently.  A spreadsheet row/column to you may mean something totally different to me. 

Lastly, The Media Kitchen's website URL is http://www.mediakitchen.tv  (we get that confusion all the time)

Thanks again.

over 7 years ago

Meghan Keane

Meghan Keane, US Editor at Econsultancy

Sorry about that Darren. It's fixed now.

over 7 years ago

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