Rather than lamenting a dearth of online ad inventory, ADTECH's managing director, senior VP of sales suggests ways for marketers to boost their current ad effectiveness.
The drought of ad inventory is well known in the digital marketing industry. According to executives at the major web portals, premium ad inventory for the core holiday season was all but sold out by the time the shopping season kicked off. Advertisers, particularly retailers, locked up most of the premium inventory on AOL, MSN and Yahoo! long before the holidays. MSN executives said designated shopping placements on the site's home page went on sale in August and sold out for the entire holiday period within a week.
With scarce resources and such fierce competition, how are advertisers supposed to get their hands on premium inventory, particularly those on limited budgets? Of course, planning well in advance and acquiring inventory before prices are driven up by surging demands helps. But there is another approach altogether to consider: Get the most out of your existing inventory.
Advertisers and publishers often look to better inventory to solve their advertising deficiencies when in reality they should be looking for ways to monetize every single ad impression.
In other words, the days when the main goal was to expose users to your ad as much as possible are over. It is not enough to hope that exposure will have some inscrutable effect on brand awareness, which will translate into acquisitions. It just makes no sense to target "the audience" when what an advertiser wants is to encourage "the individual" to buy their products or services.
The keystone for maximizing ad inventory is optimizing delivery. The aim should be to use as little inventory as possible to get a result as big as possible. To accomplish this, advertisers must only target users that are relevant.
The following are just a few tips:
Behavior: Tracking a user's past behavior is paramount because it will determine what advertisements will be shown subsequently to said user. If a user's past behavior shows that he/she is not interested in automotive, for example, suppress ads relating to automotive. Conversely, if a user's track record shows an inclination toward automotive, present automotive ads as well as ads relating to automotive.
Smart inventory solutions can determine the likelihood of whether or not a topic is still relevant for a user. Ads for last minute travel, for instance, will probably have close to zero effect if they are shown a week or month after a user has visited a last minute travel site-- but very effective when shown right away. This varies, of course, as some products or services require a more mature decision, so the "follow-up" might be delayed for optimal results.
Demographics: Target geographic areas with a certain average income. Research shows that product purchases are linked to regions with a particular income. Mail-order companies have been targeting consumers as such for decades. Banks also capture this information to determine whether or not a person will be granted a loan.
Other data that could be useful for your campaign are the average number of persons per household, the number of cars per household, or the average price of a home in a given neighborhood. Why show ads for high-price luxury items to people who cannot afford it? Conversely, why show ads for stuff that wealthy people would not buy in their neighborhood?
Auto optimization: Set up a campaign that suppresses an ad, or displays a follow-up ad, for each user that has already made a purchase. The principle in auto optimization is much the same as tracking behavior. When showing a follow-up ad -- like when the user buys an iPod online -- this can be tracked so that the next ad will say: "Don´t forget to buy your iTunes-Gift-Cards." In this scenario, no ad is wasted.
But optimization can be more than that. You can tell a story by showing a sequence of banners to users. A good ad serving solution like HELIOS IQ will also optimize delivery by click rate or conversion rate-- which means that your choice of the most clicked or most conversion-generating banner will be preferred in delivery to boost the success of the campaign. Also, the system could optimize for run-of-site campaigns. If certain placements do not work with a given campaign or a certain goal click or conversion rate is not met, the under-performing placement will be eliminated from the campaign. This matches the optimization of the best performing ads with the best performing placements.
Using these methods above to target and track consumers would increase the relevance of online advertisements dramatically for the user, thereby increasing the user's acceptance of the ad. This, of course, would maximize the advertiser's ROI.
Nils Winkler serves as Managing Director and Senior Vice President of Sales for the American office of ADTECH, one of the global leaders in the Digital Marketing sector working with clients like AOL, SKY TV and Clear Channel. Read full bio.