The State of Behavioral Targeting

The Path to One-to-One Marketing: The State of Behavioral Targeting • Tuesday, July 31, 2:30-3:30 PANELISTS: Brent Hieggelke, VP of Strategic Marketing, Omniture Philippe Suchet, General Manager, Kefta/Acxiom Digital Geoff Atkinson, Marketing Chief of Staff, Overstock.com Tim Mahlman, Chief Revenue Officer, BlueLithium MODERATOR: Mary E. Morrison, Contributing Editor, BtoB

Behavioral Targeting: What is it?
Observing customer or prospect’s online behavior and using that data to deliver relevant ads or Web site content
Identifying data such as: Web sites and pages visited; tools used; time, length, frequency of visit
Merging behavioral data with visitor data such as age, gender or ZIP code

Behavioral Targeting in the news
Google-DoubleClick
Yahoo!-Right Media
WPP Group-24/7 Real Media
Microsoft-aQuantive
AOL-Tacoda

BlueLithium + Hyatt Hotels and Resorts Case Study

Hyatt Hotels and Resorts
Situation:
Hyatt, a leading hotel and resort destination, wanted to increase visits to their resort/spas.
Their target resort/spa visitor is a female professional with a family, looking for a quick weekend getaway, usually at the last minute.
Different from luxury resort/spa visitors who book in advance, have longer stays and are less price sensitive.
Behavioral Targeting was chosen to find this very specific audience segment

Audience:
Target :
1) Moms
2) Females, ages 25-54
For both groups, HHI of $150,00+ and history of researching travel in past 30 days
Challenge:
Locate this very specific audience, while in market for resort/spa getaway.
Decision-making time often two weeks or less.

What we did:
Started with demographic targeting of Females 25-54 and Mom’s, with high HHI.
Overlaid AdPath Audience Targeting (“recent travel research segment”) to create a tight focus.
Scaled the segment using Selective Inventory Partnership (SIP).
Added AdPath Site Remarketing.
In parallel, we tested other audience segments:
Found that Female HHI $40K+ outperformed higher HHI, added to campaign to boost performance.

Hyatt Hotels and Resorts Results: BlueLithium beat Hyatt’s targeted cost per customer by 74%

Kefta Dynamic Targeting & Overstock.com Case Study Philippe Suchet - Acxiom Digital, Kefta GM Geoff Atkinson - Overstock.com, Marketing Chief of Staff

Why are we talking about behavioral targeting?
Acquisition costs rising and conversion rates decreasing
Power switch from marketers to users: Push to pull
Key is put customers at the center of your marketing strategy, and move from mass market to behavioral targeting

Key learnings
All about targeting and not just behavioral targeting
The Google lesson: Art and Science is key to success
Experience is far more important than the placement

Overstock.com Case Study
Geoff Atkinson, Marketing Chief of Staff
Issues we faced:
Difficulty in fully realizing customer lifetime value:
Complexity of matching customers to constantly changing offers
Difficulty in creating an experience that can leverage differences between behavior and attributes of site visitors
Solution: Leverage power of behavioral targeting:
Provide value to prospects, customers, and bottom line
Provide organizational learning to feed back into marketing processes and shape future strategies
Provide consistent brand message between key online channels

Overstock.com Case Study Website personalization Unified visitor profile Example programs 1-to-1 triggered email

Overstock.com Case Study
Quantitative results
Double digit conversion lift for campaign
Increased efficiency of acquisition efforts

Qualitative results
Visitor centric learning we can apply to other marketing efforts
Minimal requirements on internal resources
Put power of marketing back into the hands of marketers

On-site Behavioral Targeting Brent Hieggelke VP Strategic Marketing Omniture

Large gap in off-site and on-site spending… Off-site Resources Email marketing Affiliate programs Behavioral Targeting Paid search management Banner advertising Call center referrals Search Engine Optimization Offline marketing to web In-store Web promotion $ $ $ $ $ $ $ $ $ $ $ $ On-site Resources On-site Resources Registration optimization Site testing Web analytics Usability testing Off-site Resources On-site Resources Large Investment Gap

But the on-site engagement determines conversion success Off-site Marketing Spending On-site Experience Determines Conversion Rate Critical Engagement Layer Campaign Traffic Email marketing Affiliate programs Behavioral Targeting Referred Traffic Paid search management Banner advertising Call center referrals Direct Traffic Search Engine Optimization Offline marketing to web In-store Web promotion Campaign Landing Pages Home Page Successful conversion $$$ Conversion Process Product Category Pages Attrition losses Attrition losses

How automated 1 to 1 targeting works: Visitor arrives at your website Visitor Profile Repository Call goes out to Visitor Profile Repository CMS (Serves content) build profile First-time visitor retrieve profile Repeat visitor Self-learning Predictive Modeling Engine Optimal content decision sent to CMS Content library

What data is used to select the relevant offer? Offline Customer Variables Referring domain Campaign ID Affiliate PPC Natural search Search keywords (“loans”) Direct/bookmark Referrer Variables Customer/prospect New/return visitor Online banking login Tools usage Previous Product interests – low level Searches Previous online purchases Previous Campaign exposure Previous Campaign responses Site Behavior Variables IP address Country of origin Time zone Operating system Browser type Screen resolution Environment Variables Temporal Variables Time of day Day of week Recency Frequency Highly predictive anonymous visitor profile

On-site Behavioral Targeting was implemented with the specific goal of increasing conversion and sales across products
Other reasons:
Creative testing and optimization
Sales target management
Managing homepage politics
Real-time reporting
Easy to use automated system
Excellent customer service
Sophisticated targeting system
Reports that can prove the uplift in revenue each month
Lloyds TSB Initial Goals

Profile A

Profile B

Profile C

Profile D

Targeting on the secure logoff page

Lloyds TSB Targeting Report

Thanks.
Brent Hieggelke
[email_address]

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The State of Behavioral Targeting

by Marco Derksen on Sep 17, 2007

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