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I read with interest a recent article by the New York Times, explaining how Netflix is using data from its user base to make decisions about what content to show, and more importantly what content to produce.
While the use of data as a way to pre-empt what an audience might react best to is relatively new in the world of content production, it is commonly used to make decisions about all manner of things online, particularly with regards advertising. Technological innovation has enabled search, display, social media, email and even TV to be managed and measured through a single interface, and this integration has enabled advertisers to get more personal than ever before.
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Over the last couple of years there have been significant advances in the way information about individuals’ online behaviour is being gathered and we have moved beyond the use of simple channels and categories to a point where many ads are now served on a user-by-user basis.
Audience targeting especially has experienced massive growth and it was estimated to account for as much as half of the £460m spent on online display in the UK in the first half of 2012.
Key to the success of audience targeting is its ability to move advertising beyond simple targeting of users by placement and content type, to analysing recent web browsing, search and interaction habits to determine what users are likely to do. Much like Netflix in its quest to ascertain what types of content will be popular, advertisers seek to use data to identify the audiences who will be most likely to purchase a particular product or service.
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Once a valuable audience is identified, tactics such as re-targeting help to ensure those valuable visitors see the most compelling message using data about what they have done, to help to tailor ads to influence what they might do in the future.
The full potential of this approach is put into context when you consider that 95% of users leave a site without making a transaction, and that those who are re-targeted with a relevant ad are 70% more likely to complete a purchase. So as a conversion optimisation tool, particularly off the back of an existing SEO or PPC campaign, this approach makes a lot of sense, in fact, it’s a no-brainer.
By combining a customer's behaviour when browsing a brand's website with additional data about how that customer engaged with the brand's display ads and email campaigns, companies are starting to re-shape their websites to fit with the customer's likely frame of mind.
While this all sounds very Orwellian, these new targeting techniques now provide brands with the tools to create a completely personalised online experience for each and every person who visits their website, in real time and to customise content based on what works best.
The ongoing challenge is to identify how best to collect and manage the most relevant and valuable data while trying not to become too preoccupied with the whole process and losing sight of the ultimate goal.
As the integration between the different digital disciplines continues, we find ourselves in exciting times. As digital marketers continue to refine and perfect new targeting techniques, the experience improves for the customer. I have to say I think this is a good thing, as personalised advertising based on what you need, want and like is surely better all round.
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