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B2B Display Advertising How-To Guide

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Executive Summary

Business marketers have always advertised in specialized media such as trade magazines, but their audiences have traditionally been too narrow to use television, radio, and similar mass outlets. This limitation has carried over into the digital world, where business marketers could target ads on search terms and industry Web sites but not buy display ads that reach broad audiences. This has become an increasing problem as buyers do more research anonymously on the Web, making them harder to identify and nurture. Tools such as content marketing and social media have filled some of the gap by offering alternative methods of acquiring new names. But those methods are labor and content- intensive, making them difficult to scale. As a result, business marketers have longingly eyed the “insert coin here” efficiency that lets consumer advertisers reliably increase results by raising their display ad spend.

Happily, new methods have now made online display advertising a more effective, higher volume option for business marketers. Improved audience targeting expands the number of prospects marketers can reach and how frequently they can be contacted. Business marketers must learn a few new tricks to take advantage of this opportunity. But in return they gain a greater control over the flow of new names and more precise targeting of the messages for each individual. This Guide will ease your entry to the new world of effective B2B display advertising. Let the journey begin.

This brief 11-page How-To Guide is designed to provide practical advice for B2B Display Advertising and outlines the following:

What is Display Advertising?
Display Advertising For Marketers
Challenges
Resources
Action Plan
Bottom Line


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B2B Display Advertising How-To Guide

  1. 1. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. B2B Display Advertising By David Raab, Raab Associates June 2014 EXECUTIVE SUMMARY Business marketers have always advertised in specialized media such as trade magazines, but their audiences have traditionally been too narrow to use television, radio, and similar mass outlets. This limitation has carried over into the digital world, where business marketers could target ads on search terms and industry Web sites but not buy display ads that reach broad audiences. This has become an increasing problem as buyers do more research anonymously on the Web, making them harder to identify and nurture. Tools such as content marketing and social media have filled some of the gap by offering alternative methods of acquiring new names. But those methods are labor and content- intensive, making them difficult to scale. As a result, business marketers have longingly eyed the “insert coin here” efficiency that lets consumer advertisers reliably increase results by raising their display ad spend. Happily, new methods have now made online display advertising a more effective, higher volume option for business marketers. Improved audience targeting expands the number of prospects marketers can reach and how frequently they can be contacted. Business marketers must learn a few new tricks to take advantage of this opportunity. But in return they gain a greater control over the flow of new names and more precise targeting of the messages for each individual. This Guide will ease your entry to the new world of effective B2B display advertising. Let the journey begin.
  2. 2. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. DISPLAY ADVERTISING BASIC Web display advertising includes any kind of advertising presented on a Web site other than a search engine. (Search advertising, such as Google AdWords, is different enough that it’s best treated as a separate topic. Search advertising is much simpler to manage than display advertising, so most business marketers are already familiar with how to use it.) Site-based vs. Visitor-based Targeting The fundamental benefit of display advertising is that it takes advantage of audiences assembled by Web site owners. Usually the audience will be attracted by the content of the Web site and thus share a common interest related to the advertiser’s product: corporate travelers will go to a corporate travel Web site, steam turbine buyers will go to a steam turbine Web site, and so on. For this reason, marketers are often content to show their advertisements to everyone who visits a site, without knowing anything else about them. Ads may also be targeted at specific visitors based on information such as past behaviors or known interests. This requires technology to identify those visitors. In this case, the contents of the Web site where the ad appears are largely irrelevant. (Exception: marketers often avoid ads on Web sites whose content they consider objectionable.) Visitor- based targeting usually relies on Web browser cookies that associate a computer with behaviors or interests, even though they may not be linked to a specific person. Visitor-based targeting is increasingly available for business marketers. It can be more effective than site-based targeting and greatly expands the number of opportunities to deliver targeted advertisements. Targeting may also be based on other attributes such as the user’s physical location, their employer, search terms, previously visited Web sites, or the type of device they are using. This information is derived from technical data provided during Web interactions. Employer-based targeting is especially relevant to business marketers. Purchase Models Display ads may be sold on basis of cost per impression (cost per thousand or CPM), cost per click (CPC), or cost per action (CPA), depending on the publisher and the situation. Most ads are sold at a fixed price, typically as part of a negotiated contract for large number of impressions. Others are sold on ad exchanges through real time bidding on individual impressions. Different approaches serve different needs.
  3. 3. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. Many marketers use several methods to provide the most effective results. For example, they might make a bulk purchase of site-based ads and supplement this with visitor-based ads targeted at high value individuals. Process Flow The actual mechanics of Web display advertising can be surprisingly complex. Indeed, the advertising technology industry sometimes seems to take a perverse pride in the obscurity of its processes. Still, the basic steps and related systems can be summarized as follows. See the Glossary for definitions of boldface terms.  Advertisers create their messages (banner ads, videos, etc.) and store them in an ad server where they can later be fed onto actual Web pages.  Publishers create Web pages with tags that will display advertisements when the pages are delivered. The tags may call the publisher’s own ad server directly or they may call an ad network which controls what is displayed. The tags can also set and read browser cookies to identify the user to the publisher.  Advertisers place orders that determine who will see their advertisements. They can either purchase ads based on where they will appear (site- and page-based targeting) or who will see them (visitor-based targeting). The advertiser can buy directly from publishers or ad networks, purchase through an agency trading desk, or enter orders into a demand side platform that coordinates purchases from multiple sources. When purchases are based on visitor characteristics, a list of cookies to target is loaded into the demand side platform from a data management platform, which in turn gets cookies with the desired characteristics from data brokers.  When an individual visits a Web page, the ad tag within the page either loads a page-based advertisement or sends cookie information to the publisher or ad network, which may serve an ad based on the visitor characteristics or let an ad exchange offer the impression to multiple buyers via real time bidding. Bidders use cookie data and other considerations to decide what the impression is worth.  Once an ad is selected, it is loaded from the ad server and rendered on the Web page. Tags on the Web page or within the
  4. 4. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. advertisement may later send the publisher or advertiser additional information used to measure results and optimize future selections, such as whether the ad is viewed or clicked on, location of the viewer, and time of day. Social media networks such as Facebook, Google+, and LinkedIn use different technical mechanisms but can also deliver targeted advertising based on either the contents being viewed or characteristics of the viewers. DISPLAY ADVERTISING FOR MARKETERS The main factor limiting business marketers’ use of Web display advertising has been the relatively small number of impressions available on business Web sites. This has led to high prices and limited the volume of business that marketers could generate. Visitor-based targeting has greatly expanded the inventory of available impressions by enabling marketers to reach their target audiences on non-business Web sites. Although marketers are sometimes concerned about the context of these advertisements, they can be more effective than content-based ads if the targeting is based on sufficiently precise information. One powerful example of visitor-based advertising is retargeting, which shows ads on other Web sites to people who have visited a company’s own site. Because the retargeting can be based on browser cookies placed during the original site visit, the ads can be served even if the visitor did not identify herself by filling out a form or taking some other action. This greatly expands the reach available to company marketers. Other techniques to improve display advertising results include:  Frequency caps that limit the number of times an individual is shown an advertisement. This ensures that ad spending is not concentrated on a small number of frequent site visitors. It depends on cookies or other methods of identifying individuals.  Personalization that tailors ad messages to individual interests or characteristics, such as company, location, industry, or title. This information may be inferred from behaviors, provided by visitors when they fill out forms, or purchased from third parties and linked to the visitor via cookies, IP address, or other identifiers.
  5. 5. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved.  Content testing that automatically delivers different advertisements to similar viewers to see which performs best. Such testing can usually be built into the ad serving process so the human effort is minimal. Some systems can automatically construct different ads by combining alternative headlines, photos, and offers to find which combination performs the best. This allows marketers to test more options than they could manage manually.  Other testing of such variables as audience segments, frequency, time of day, and placement on the Web page to find the best performers. Systems can often automatically monitor results and remove the losing options to improve results over time. Users select the metric used to define good performance, which may be page views, clicks on links within the ad, or subsequent conversions such as filling out a form or making a purchase.  Budget limits that ensure advertisements are spread over time by capping the number of ads or amount spent per day. Similar constraints may limit the cost per impression or cost per action. Such limits can usually be defined as part of the campaign set-up and enforced automatically.  Alternative formats, such as video, animation, or in-ad surveys. These often attract more attention than static standard advertisements. They may cost more but marketers can easily measure performance to determine whether they are worth the added expense. CHALLENGES Some of the challenges that display advertising presents to business marketers include:  Visitor tracking – Many audience tracking techniques are based on browser cookies, which are far from perfect. Privacy- conscious users often block their browsers from accepting cookies or periodically delete cookies they have previously accepted. Many people browse on multiple devices, such as home and office computers, smart phones, and tablets, which have separate sets of cookies that are not easily linked to provide a complete customer view. Some mobile devices will not accept cookies at all, although advertisers have developed some ways to at least partially compensate for this.
  6. 6. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved.  Privacy – Marketers must limit the data they collect from visitors and how they use what they gather, both to comply with legal restrictions and to avoid making visitors uncomfortable. It’s important to be aware of the rules that govern the use of individual data, to recognize that these differ in different countries, and to keep an eye on new regulations and evolving industry best practices.  Measurement – Display advertising generates plenty of data, including impressions, cost per impression, clicks, and conversions. But those metrics often don’t capture the real value created by an advertisement, such as customer attitudes or changes in long-term behavior. One critical issue is that display advertising often influences future leads indirectly when they see an ad but don’t click on it. Traditional methods such as attributing leads to the first or last ad they view are widely recognized as misleading and often underestimate the impact of display in particular. More sophisticated methodologies are available but can be expensive and difficult to understand. Marketers can gain some insight from simpler analyses such as correlating changes in lead production with changes in ad spend or measuring how many new leads viewed a display at any point in their life cycle.  Expertise – Creating effective display ads, buying media, and measuring results are new skills for many business marketers. The options for purchasing display ads are especially confusing: content-based vs. viewer-based, fixed price vs. bid, cost per impression vs. cost per action. Although self-service options are available, many marketers do best by working with agencies to provide the necessary skills and experience.
  7. 7. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. RESOURCES Several vendors have developed specialized offerings for B2B display advertising. Most can provide general information on the topic even if you don’t use their services. Companies to consider include:  Bizo. A B2B advertising network with particular strength in business advertising on Facebook and LinkedIn, supports cookie-based personalization on company Web pages, and integrates with marketing automation systems for cross-channel campaigns.  DemandBase. Uses the IP address of Web page visitors to identify their employer and delivers targeted advertising on that basis. Also supports marketers and sales teams by identifying Web site visitors by company, auto-filling Web forms with company information, enhancing lead records, and targeting messages on corporate Web sites based on the visitor’s employer.  Vendemore. A Sweden-based B2B ad network that uses IP address and cookies to target and retarget display advertising and to deliver Web site personalization. Particular strength outside the United States.  BBN Solutions. B2B ad network that offers site-based ads and real time bidding on impressions outside its network. ACTION PLAN The complexity of creating, buying, and evaluating Web display advertising can seem overwhelming. But marketers can ignore many of the technical details and hire experts to handle much of the remaining work. So getting started isn’t as hard as it looks. Just follow these steps:  Decide whether Web advertising is worth trying – Is your company having a hard time finding enough new leads? Do you have the budget to create new ads and purchase ad impressions? Is it impossible to reach the complete pool of potential buyers directly through purchased lists or trade shows? Most companies would answer, “yes” to all these questions but your situation might be different. The key benefit of display advertising is that it reaches potential buyers early in the buying cycle, well before they are ready to contact you on their own.
  8. 8. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. This expands your audience beyond those people who know your company already.  Create a test program – Define specific goals for your initial campaign, including the types of people you want to reach, the message you want to convey, and the results you hope to generate. Much of the creative can be based on existing marketing materials but bear in mind that display advertising has its own requirements for effective promotions. Use an experienced agency to guide you in the right direction for both ad creation and media buys. The initial program doesn’t have to be very large: its goal is only to measure potential results. If budget permits, try a couple of different approaches, such as site- based and individual-based targeting. If money is very tight, consider starting with a retargeting program, which nearly always provides a positive return on investment.  Measure results – Accurately measuring the results of your test is critical. Be sure before you launch that you have mechanisms to capture the names of any leads the advertisements might generate – typically via landing page forms linked to your ads. But also recognize that the value from display ads often accrues over time to people who don’t respond immediately and may later connect through other channels. So look for indirect measures such as changes in Web site traffic, contacts from people or companies you know saw your ads, and recall of ad messages.  Expand – The initial test is just a starting point. Assuming results are promising, you’ll want to refine your display program by trying different audiences, media strategies, and creative approaches. This should easily double or triple your original results over time. One caution: the number of impressions on high-performing sites is often very limited, especially if you are chasing a narrow audience. This can limit the volume of business that display advertising can generate. It’s also why individual-based targeting and real time bidding are so important: they let you reach the right people outside of industry-targeted Web sites.
  9. 9. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. BOTTOM LINE Web display advertising is a new frontier for many business marketers. Like any frontier, it hides unknowns and presents risks that more familiar terrain does not. But the paths to success are increasingly well marked, the rough spots are increasingly paved over, and experienced guides are widely available. Business marketers should plan an initial journey to explore the new terrain and find out how they can harvest its resources. ABOUT THE RESEARCH ANALYST With an MBA from Harvard, David is an expert in both B2B & B2C marketing strategy & technology. He has advised The Gap, JC Penney, Lowe's, Blue Cross/Blue Shield, Williams-Sonoma, Scholastic, Unisys, Sprint and Verizon Wireless. He also publishes the Raab Guide to Demand Generation Systems and the Marketing Performance Measurement Tool-Kit.
  10. 10. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. APPENDIX – GLOSSARY  Ad Exchange – Organization that offers advertising impressions from multiple publishers and ad networks for purchase, including real time bidding. Impressions are identified by Web site and cookies.  Ad network – A group of Web sites that sell shared access for advertisements. Networks place their own cookies which let them identify and target individual visitors across all network Web sites.  Ad server – A system that stores display ads and sends them to Web pages to be rendered.  Advertiser – Organization that purchases ads on a Web site.  Agency Trading Desk – Ad agency system that manages purchases of Web ads from multiple sources. Unlike a demand side platform, it does not store lists of cookies.  Cookie – A small file placed on a computer by a Web page. Cookies store a unique identifier and sometimes other information such the date of the last site visit. They do not usually store personal identifiers such as a name or address. First party cookies are cookies are created by someone other than the Web page owner, such as an ad network. Cookies can only be read with the owner’s permission.  Data Management Platform (DMP) – A system that stores cookies and other data related to individuals who are targeted by advertisements. Cookies are associated with attributes such as demographics, company information, buying interests, and recent behaviors. A DMP may hold multiple cookies from computer or individual. These can be linked to build a combined profile.  Demand Side Platform (DSP) – A system that manages the purchasing of Web ads from multiple ad networks and ad exchanges. The DSP may contain lists of cookies representing individuals an advertiser wishes to reach. This would be loaded from a data management platform. DSPs
  11. 11. How-To Guide © 2014 Demand Metric Research Corporation. All Rights Reserved. perform other functions such as monitoring ad costs and responses to optimize ad purchases over time.  IP-based Targeting – Use of the Internet Protocol (IP) address to identify the company where a Web site visitor works. This relies on the directories that show which IP addresses are used by which companies. It works best with employees of large companies that have their own Web servers. It can be used to identify otherwise anonymous visitors, although it does not distinguish different individuals within the same company.  Publisher – An organization that creates a public Web site whose pages can include advertisements.  Real Time Bidding – A method of selling ad impressions through auction. As Web pages are loaded, a tag on the page sends the page and cookie information to the ad exchange hosting the auction. Bidders examine each impression and decide how much to bid. Highest bidder then sends their advertisement to the page to be rendered.  Retargeting – Sending advertisements to individuals who have previously visited and advertiser’s own Website or taken other significant behaviors. Retargeting is usually very effective because it can be tied to specific actions that indicate the visitor is a high-value prospect.

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