How did they know to search for that brand?

Just a quick post to highlight a recent piece of research by attribution modeling company C3 Metrics (thanks AdExchanger!).

There’s more interesting detail at the link, but the headline is that in 37% of all online transactions analyzed, search on a branded term was the very last action before purchase.

That’s obviously bad news for the (too) commonly used “last click / last view” attribution approach.  As C3 CEO Mark Hughes put it, “If an advertiser is still using last click analytics, they would mistakenly think that brand search was responsible for a third of their results.”

This research underscores the fact that attribution is important, difficult stuff and requires a lot more horsepower than last click / last view.  I think folks like C3 have a great opportunity ahead of them.

C3’s findings echo a great piece of Microsoft research from a couple years back.   As I mentioned in my commentary when the Microsoft research came out, it’s clear that a lot of the money that brand marketers are spending on other media (online and offline) is having an impact – whether or not we can measure it precisely today.

Worth some thought.

What is the definition of “Online Display”?

I recently explained why the IAB’s new video ad serving standard (“VAST” for short) will have a huge impact on the online video ad market by breaking down format barriers.  Online video advertising competition is increasing rapidly as the most sophisticated display ad networks ramp up video efforts aggressively.  That article generated energetic discussion, with virtually everyone, even incumbent video ad networks, agreeing with the fundamental thesis of convergence.

As it happens, I wrote that piece on the way to CES.  Right after my co-founder, Elizabeth’s panel discussion we were approached by the CEO of a Digital Out Of Home (DOOH) network.  His question:  is buying DOOH inventory?  Our answer to him:  it’s lack of standards, not lack of business potential, which prevents us from seriously considering it.   Our next thought:  it’s time to write about a topic we discuss frequently with our investors and industry analysts:  accelerating online media format standardization and accelerating media convergence (the ever-blurring line between what is “online” and what is “offline”) are working together to create a financial opportunity in the online display market that is even bigger and growing even faster than they think.

While online media advances rapidly, hardware, telecom and content providers are moving just as aggressively in “IP enabling” TVs and other consumer electronics devices to take advantage of new technical possibilities and to accommodate quickly evolving user habits.  This isn’t just the usual future-state pronouncements from technology titans like Microsoft.  For example, mass-market consumer retailers are changing up their offerings quickly too.  Consider Best Buy’s recent announcement that all web-connected TVs it sells will come with a subscription to a Best Buy library of content.

So when you’re sitting on your couch, looking at your 50” flat screen TV on the wall, watching a show that is streaming from Best Buy through your internet connection and you see an ad, does the “offline advertising” cash register ring somewhere or the “online advertising” one?

The (literally) 11-figure question is: will the bigger catalyst for “driving TV budgets online” be (a) online ad technology / format innovation or (b) consumer device evolution and usage blurring to the point where “online content” becomes impossible to distinguish from “offline content”.  You guessed it – we vote (b).

Of course it doesn’t stop at just TV and Online Video.  All digital media comes together.

I started this piece with a DOOH executive asking us about partnership opportunities.  Many DOOH devices are already IP-enabled and that percentage is growing rapidly. Network owners should follow the IAB’s lead, standardize DOOH ad units and serving protocols and watch the money flow!

And how long will mobile remain a hodgepodge of complex and proprietary advertising standards?  Not long.  Apple (true to form) blazes the trail to the future here:   when you’re browsing the web on your iPhone, where do you think the display ads you see are being served from?  Answer:  in most cases, the exact same systems that serve them when you’re browsing on your PC.   Sure there are some issues with Flash compatibility, but the direction is clear; format barriers are falling.

Surprised?  You shouldn’t be.  Mobile offers powerful capabilities for hyper-local, hyper-timely offers, but geographic and temporal targeting are not new concepts in online advertising (or in “offline” advertising for that matter).  Why should we need a whole separate “stack” just to deliver an ad to a different device?    The new iPad makes the distinction between “mobile device” and “computer” melt away even further.   The Apple example will evolve rapidly from exception to rule, particularly as more encouraging performance data emerges.

So as with video serving standards, the question of the digital marketplace coming together isn’t “if” but “when”.    More and more devices will become IP-enabled with increasing degrees of standardization to take advantage of the financial opportunity.  Online advertising will grow bigger and faster as advertisers can more seamlessly trade off serving offers against the right consumer on the right device, managing cross-channel campaigns in an ever more integrated way.    The definition of “Online Display” will broaden dramatically, essentially encompassing all graphical advertising regardless of format, size or screen/device.

We’d love to hear your thoughts on which capabilities will be most valuable in this fast-approaching merged media world, and who in the current crop of advertising players possesses them.  I look forward to sharing your thoughts, and my own, in an upcoming piece.

As I have mentioned previously, the next 12-36 months will be exciting indeed.

Microsoft gets it

More great stuff from Microsoft’s Young-Bean Song at the OMMA performance show Monday in San Francisco.  Microsoft has made no secret of the fact that they are focused on the brand advertising market and clearly the push continues.

I would encourage you to watch the embedded video of Young-Bean’s talk.  The content is fantastic and well-delivered, particularly the planning example at the end.  Building from earlier Atlas Institute research, Young makes the argument for the utility of offline metrics for online Brand campaigns.  I couldn’t agree more.  Reach, composition and pricing guarantees that back into guaranteed GRPs, TRPs and CPPs are exactly what online Brand advertisers need for cross channel planning.  As he points out, ROI tradeoffs happen throughout the funnel, but that shouldn’t always mean just “CPA”.

The discussion about the importance of complete attribution models vs. the too common last click / last view approach, while also not new, is very much worth hearing again (and again).  Working – and measuring – the full funnel is just as important online as offline.

Microsoft understands this market extremely well.  Don’t underestimate them.

Great minds think alike

Nice short piece this AM from Peter Kafka of allthingsd re: Microsoft’s plans to enter the Exchange 2.0 landscape with a re-tooled AdECN.  Very much in line with my post earlier this week in Ad Age.  As I wrote, the next 12-36 months will be interesting indeed…

Microsoft continues its push into online branding

As I work through my current events backlog after coming back to the office, I wanted to call out this press release from  Microsoft re: their recent deal with comScore to provide enhanced R/F and audience composition tools for branding-focused media buyers.  The release highlights a theme we are passionate about at and have mentioned time and again on this page:  online advertising lacks brand-friendly metrics and tools, which makes it too difficult for brand buyers to plan and manage campaigns in a manner consistent with the rest of their (primarily offline) spend.   These metrics and tools position brand marketers to deliver real business results and are essential in helping brand budgets follow audiences online.  Our friends at Microsoft were even kind enough to quote our analysis estimating only 5% of brand budgets have yet made this transition.  As today’s Wall Street Journal also observed, this represents a major opportunity for all the players in the space.  It’s great to see the online ad industry increasingly recognizing the brand challenge/opportunity and mobilizing to address it!

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