Big-Ticket advertisers like Nokia, Colgate Palmolive, Tata Housing, Reliance, Airtel and Hutch seem to be warming up to online advertising. Even though ad spend today is relatively modest, several advertising agencies seem to be pushing their clients hard to what is expected to grow to a Rs 1,100-crore market by 2011. Insiders attribute the rush to higher commissions (online ads can fetch up to 10-11%) and the superior ability to track the return on spending.
Commissions, however, are only a part of the story. Internet advertising is not merely about commissions, says Ayan Chakraborty, associate vice-president, Bates 141, Kolkata. ?Online media?s popularity as an ad medium is more to do with its strength of being highly focussed and interactive. More importantly, the ad impact is measurable up to a level that is not possible in television and print,? he adds.
As with many other success stories in the digital world, technology has helped them to log in to their biggest achievement. The analytical tools or the ad serving tools help advertisers, as well as publishers to target internet users in terms of demographics, geography, behaviour and context. What started as a keyword search, with Google dishing out ads related to the content visitors searched for, is now taking the next step with the latest tool?behavioural targeting. Globally, around 22% of corporate internet ad spending goes to behavioural targeting, while contextual targeting gets 28%. Corporate spending based on demography and geography account for 19% and 20% respectively, according to Forrester Research.
Along with contextual advertising, which is core to Google?s value proposition, behavioural targeting (BT) is promising to reshape the internet advertising landscape. Having created a stir in the US, these tools are now gaining acceptance in the Indian market too. Most publishers use specialised delivery software, which ensure deep level targeting, according to Arvind
Kajaria, founder of 123 greetings.com. His company uses 24×7 Real Media tools to target its users.
?They are very effective as one can target very conveniently for country, state or city along with demographic segmentation such as male, female or age,? Kajaria says.
Consider Australia-based ZaaBiz, for instance. The business networking site is getting ready to launch it services in the Indian market. It is now looking for tools, which will deliver messages of advertisers to a very specific audience. ?ZaaBiz hosts micro communities on the platform that focus content around a specific subject,? says Michael Brecht, chief executive officer of ZaaBiz. The tools will help corporate advertisers to target micro community users participating in content specific programmes.
An ad serving tool allows a website to decide which ads serve where and how many, explains Roy de Souza, founder & CEO of Zedo, the US-based digital marketing and services company. Zedo offers BT ads and specialises in new internet sites. The other major players who are here with their tools are Double Click, a Google company and 24/7 Real Media, which belongs to the ad giant WPP group. ?So if you have a website like Indiannews.com, you can use an ad server to show an ad for a new flight from Bangalore to San Francisco. This can be restricted to visitors based in Bangalore,? says de Souza. Also Indiannews.com can use the ad server to show each user only two ads a day and none after midnight. ?All these make the ad serving tools unique in internet advertising,? says de Souza.
Internet marketing technology like Zedo does BT while Double Click goes for page text targeting, which is contextual in nature. If a user goes to Makemytrip.com and searches for a flight from Mumbai to Goa, but does not buy any ticket and then goes to the Shaadi.com. site, the latter will show all wedding-related ads. However, Zedo BT technology would find this user and show him ads that says, ?Come back to Make My Trip and buy your ticket today?. In a mad scramble to achieve better clickthroughs in the near-limitless inventory of ad space, many other portals are trying out similar engines.
Subharangsu Neogi, who heads brands and corporate communications in Religare Enterprises, a financial company feels that internet ad tools are making all the difference between the classical media and new media. ?Advertisement in internet comes with immense flexibility in terms of focusing particular target group and the way ads are to be placed. This is not possible in traditional media. Moreover, it is much more a transparent and credible system which can measure the impact of our spending,? says Neogi.
His company spent around 7% of its ad spending on the internet in 2007-08, and plans to increase it by 10-15% this year. ?For us, the ads on the internet are not only for branding, but also for creating right leads. We use our CRM solution to analyse the leads that are generated and subsequently target the clients,? says Neogi.
India is clearly emerging as a key market for BT engines as online ads are beginning to grow. ?BT engines are hitting the Indian digital ad space, said Prashanth Mehta, vice-president emerging markets of Yahoo India, while announcing its foray into BT technology in India early this year. India was the first emerging market where Yahoo launched its BT engine and it is expecting 30-125% improvement in clickthroughs and 5-40% CPM (cost per thousand impressions) improvement, depending on the industry.
Yahoo India started BT technology platform for select verticals?auto, retail, entertainment, finance, travel, telco and technology. It tracks a web visitors? browser clickstreams in these sectors to predict what the visitor may want in future, and target ads, content or products based on the past behaviour.
Rediff is also learnt to have conducted pilots to test BT technologies this year. Search advertisements are today estimated to account for about a quarter of the Rs 450-crore online ad market, thanks to contextual ads. And BT pioneers are eyeing the rest of the digital ad market. Many expect it could corner up to 20-40% of the non-search ad market in a couple of years.
They are not way off the mark. BT seems to be the next big thing globally, if you look at the amount (more than $10 billion) internet biggies like Microsoft, Google, Yahoo and AOL shelled out last year to swallow online advertising pioneers like DoubleClick, Tacoda and Blue Lithium.
To begin with, a BT engine on a portal like Yahoo monitors a number of user actions such as search items entered, content consumed, ads or banners clicked on and micro sites visited. All this information is then compiled over a period of time. The underlying technique is based on segmentation after observing user?s behavioural patterns on its network.
Since most of the targeting uses tools like cookies, it is bound to raise privacy concerns. None of us wants to be monitored as we surf the web in the privacy of our homes, offices or even cyber cafes. BT advocates, however, insist that all such data is anonymous and they don?t target individuals but simply find patterns in their likes, dislikes, shopping history and viewing.
?We don?t store or know any personal information. We know, for instance, that a group of 2,00,000 users visited the Kingfisher site, but we don?t know who they are or anything more about them. There is no personal data. It is all in aggregate about large groups of users,? says Roy De Souza.
As of now, it seems to be the hottest and latest way for content firms to connect buyers and sellers in a relevant way and make money.
How targeting works
Assume that Kingfisher is an advertiser and buying behavioural targeting tools from an ad network company like Zedo. Most of the users who come to KingfisherAirways.com look at prices of tickets but don?t buy. They then look at other airline sites and at travel agent?s sites to compare prices. Kingfisher wants to advertise to those users so that they come back and buy the ticket from Kingfisher and not from someone else. Kingfisher pays Zedo to advertise to users who have previously visited the Kingfisher website
* A user visits KingfisherAirways.com website
* Kingfisher writes a cookie saying this user visited the Kingfisher website
* Zedo is the ad server for say Indianews.com
* Every time Zedo sees a new user on Indianews.com, it checks that user?s cookies
* If Zedo sees that Kingfisher has written a cookie on that user, then it serves that user an ad saying ?Come back to Kingfisher.com? great prices available on all flights in August?
* If Zedo sees that Kingfisher has not written a cookie on that user than it does not serve a Kingfisher ad
* Kingfisher then pays Zedo for the ads shown and Zedo then pays 60% of what Kingfisher paid to the website (IndiaNews.com)
* Ad rates vary between Rs 10 CPM (cost per miles) for low quality inventory to Rs 150 for good- targeted inventory
