Dynamic creative: A recipe for relevant ads

Doubling the traffic from your online display channel might seem like a challenging task. However, if you consider that the average banner click-through rate of 0.1 to 0.2 percent means that only one or two people out of a thousand clicked your ad, just getting a few more to engage doesn't seem that monumental of a task. The best strategy? Relevance. Get the right ad in front of the right person at the right time and your chance for success goes up exponentially.

Enter the world of dynamic creative (aka, creative optimization technology). Web marketers have been using multi-variant testing (MVT) on their websites for years, and now the same concept is being applied to banner ads. In MVT, elements on a page are exposed to users randomly in order to find the best "recipe" for the job. For example, on a landing page, you might use MVT to test 10 different headlines, 10 different product images, and 10 different call-to-action buttons (that's 10 x 10 x 10 = 1,000 page variations). After enough statistical significance, you may find Headline C, Image F, and Button B had the highest lift in getting users to your shopping cart, and then you would let that recipe run for the rest of the campaign.

What is dynamic creative?
Dynamic creative involves banners that utilize the same idea to increase engagement and build, on-the-fly, ads that are optimally relevant to each user. Because these ads also take known data into account -- such as time of day, day of week, geographic location of the user, etc. -- marketers can start to see what works best with different user segments and can adapt the messaging to increase performance. Other data sources can also be used, including website cookies (i.e., Has this user been to site before? What sections did they check out?). Thus, these ads are not just smart, but are truly geniuses at figuring out what influences your users to take action.

How it works
To see how dynamic creative works, take the example of a car manufacturer whose ad can detect the user's region and show convertible tops to West Coast users, mud flaps and 4x4 models to rural locations, and snow tires to users in the Northern states. The ad might also detect that a user has been to an SUV microsite recently and push ads for similar vehicles. Because of this customizability, setting up for a dynamic creative campaign is a bit different than it is for standard Flash ads. Instead of delivering fully built creative, marketers create ad templates that have "empty boxes" for multiple headlines, offers, calls-to-action, images, etc., to be rotated through during the testing phase. 

Other kinds of dynamic creative exist as well. For example, Dapper can feed products from online retailers into ads to target relevant users. Basically, any ad that changes to address individual users on a one-on-one basis can be considered dynamic. There are certainly some privacy concerns here, but overall, there have been relatively few issues, and advertisers will continue to utilize technologies like these if they can positively impact their marketing ROI.

All of this intelligence must take place as the page is loading, and should provide a seamless experience to the user. Here are a few companies with the capabilities to run dynamic creative campaigns:

Adroit Interactive
Tag line: Be Adroit
Top log: Greg Smith, CEO
Founded in: 2007
HQ: Framingham, Mass.
Products: Adroit Dynamic Ad Platform
Homepage quote: "Adroit is the next generation advertising platform designed to solve a critical challenge: not enough of the right creative. With Adroit, you can modify, deploy, test, and optimize online advertising in real time, across your entire campaign."
Notes: The company was acquired by MediaMath in April 2010. It uses a Flash-based platform with a user interface that allows agencies to change ad components, such as copy, on the fly. The platform does not require pre-defined templates.
Quote: "Data targeting has come a long way. Advertisers now have the ability to filter display ad campaigns with elegant data segments. But finding the right user at the right time without the right message misses the promise of internet advertising. At Adroit, we work with our clients to understand their overall targeting segmentation strategy and build scalable creative campaigns to match their strategies, often resulting in the hundreds or thousands of creative combinations. At the end of the day, advertisers' improvement in ROI is substantial," says CEO Greg Smith.

Dapper  
Tag line: Intent-Driven Dynamic Ads
Top dogs: James Beriker, CEO; Eran Shir, co-founder and CTO; Jon Aizen, co-founder and COO
Founded in: 2005
HQ: San Francisco and New York
Product: Dapper Ads
Homepage quote: "Dapper Ads pull live product and inventory from your site, bringing the right offer to the right consumer at the right time. At least double performance and ROI over other smart ads, high lifts in travel and retail."
Notes: Finalist: 2009 ClickZ Marketing Excellence Awards; Winner: 2008 Red Herring 100
Quote: "Dapper focuses on using the advertiser's website to pull products in real time and show the right one (based on a combination of context, semantics, behavior, geo location, etc.) in a dynamic ad unit, and through our partnerships with ad exchanges we're also taking advantage of real-time bidding to buy only the audiences that fit the intent profile the advertiser is looking for. This holistic approach drives the efficiency and performance we bring to our clients," says Paul Knegten, head of marketing and senior director, BD.

Teracent  
Tag line: Beyond Smart
Top dog: Vikas Jha, founder and CEO
Founded in: 2006
HQ: San Mateo, Calif.
Products: Intelligent Display Platform; Darwin; Digital Endcap
Homepage quote: "Teracent enables savvy marketers to deliver dynamically tailored messaging to their target customer segments -- delivering on the potential of true one-to-one marketing. Finally!"
Notes: Acquired by Google in 2009; Yahoo Smart Ads Official Partner. Teracent seems to have a holistic offering, including capabilities in self-service creative management, retargeting, mobile, video, etc.
Quote: "Teracent is a data-driven dynamic ad platform dedicated to the success of advertisers. We support advertisers by allowing them full control of a Decision Engine that acts as the brain of their display media, so the advertiser's messaging literally learns and gets smarter the more the advertiser's audience interacts with it. Once advertisers have display media that can think for itself, there is no reason to turn it off -- and an always-on media approach means that advertisers never stop listening to, and responding to, their customers," says Vikas Jha, founder and CEO.

Tumri 
Tag line: Empowering Consumer Relevancy
Top dog: Hari Menon, founder and CEO
Founded in: 2004
HQ: San Mateo, Calif.
Product: The Tumri AdPod
Homepage quote: "The Tumri platform treats each creative as a composite of core sub-components (i.e., brand logo, background image, product image, offer/price, call-to-action, attention grabber, etc.), and allows advertisers to adjust each sub-component by targeting or performance parameters. By delivering the right message to the right audience at the right time, advertisers and publishers can now cut through the clutter of irrelevant content that overwhelms consumers online today."
Notes: Yahoo Smart Ads Official Partner; 2009 Stevie Award in 7th Annual American Business Awards (Technology Ads & Campaigns); 2009 and 2010 OnMedia 100 List
Quote: "As more and more people spend a greater percentage of their time in digital environments -- whether that is traditional online websites to instant messenger to Facebook and Twitter to mobile devices -- marketers must think strategically about how to engage, inspire, and activate customers in a different way. The promise of the digital ecosystem is that there is more data to for marketers and publishers to react to in real-time, and those executions can be more targeted and optimized. Dynamic creative is a critical part of the relationship building process between marketers, publishers, and customers. Audiences continue to become more fragmented, and the digital world continues to enable executions to more data driven and real time. As such, carrying the one-on-one marketing approach at scale and all the way through the last mile to the messaging and creative will be essential in activating a truly impactful dialogue with consumers," says Hari Menon, founder and CEO.

Josh Dreller is VP of media technology and analytics at Fuor Digital

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Comments

Cat Spurway-Hepler
Cat Spurway-Hepler May 24, 2010 at 7:58 PM

Good list, but don't forget PointRoll – we've been doing dynamic ad generation for several years. We can deliver more than just a standard GIF or Flash output – we can deliver and measure dynamic expandables with rich features such as video, data collection, coupons, dynamic pricing/product content and much more based on the user and/or placement. PointRoll can also layer in advanced audience data from publishers and providers including BlueKai, Quantcast, Aperture, Compete and many more. We're Yahoo! SmartAds Certified as well. http://www.pointroll.com/downloads/PointRoll_AdControl_OneSheet_Introduction_202-19.pdf and http://vimeo.com/11626623.