Recently, I came across some writing on communication theory and saw some distinct parallels between the evolution of theories on how media works and the evolution of online advertising. Many of us on the practice side, myself included, tend to dismiss or ignore theoretical perspectives of communications, but I was surprised to find they really can apply to how we in the media business world look at the principles of online advertising.
One of the first major ideas about the influence, pervasiveness and effects of communication was called "The Magic Bullet Theory" or sometimes "The Hypodermic Needle Theory." Very simply, it stated that an audience is passive and fully susceptible to media messages. This theory would have us believe that media injects the audience with its message, and they are immediately influenced. I see an ad for Product A and I go out and buy Product A.
The obvious parallel here is mass advertising, where the ad is delivered to as large an audience as possible, regardless of other factors. In online advertising, run of site (or network) ads align most closely with the Magic Bullet. Advertisers place an ad on a site or sites to reach as many people as possible hoping those who see it will respond.
Just like media theorists, advertisers were quick to take the next step in the evolutionary process.
After dismissing the Magic Bullet concept, media theorists saw that audience members are more selective in their exposure to information and the influence it holds over them. This concept is called the "limited-effects paradigm" and we can see an evolution to a smarter, more sophisticated form of media theory and advertising beginning. This starts to approach behavioral targeting but at a very basic level. It's really closer to contextual targeting, which is really one behavior at one moment in time.
For example, Porsche places an ad in the auto section of an online news site believing that response will benefit by tying the ad to the specific content of the page because the users had selected that content. However, all the people on the page will see the same ad, regardless of their reasons for visiting.
The fundamental problem with this idea (in media theory as well as advertising) is that it maintains a linear, cause-and-effect pattern that fails to take into account forces such as a person's engagement with a topic over time, and where they are in the decision-making process.
Academics saw this need and changed their perspective to focus more on the consumer instead of only the media. What they found was the most current rung in the evolutionary ladder: the Uses and Gratifications Theory. This theory is based on the idea that people are active media users who are goal-directed in their behavior and their consumption of media is particular to them as an individual. The motivations of two people visiting a certain web page cannot be accurately understood based on the page content.
This theory parallels behavioral targeting in that advertisers can utilize past behaviors to determine a user's level of engagement with a product or category. This creates a more symbiotic, complementary ideal of advertising.
For example, you, I and a third person all happen to be on an online news site's auto section. I may really like the Porsche brand and want to read everything about the company even though I'm not a buyer. You, on the other hand, go to the same article, not because of your love for the Porsche brand but because of your interest in the aerodynamic design of the car. The third person is actually in the market for a new car.
While limited effects would treat us all the same, behavioral targeting -- by looking at behavior over time -- can more accurately address our individual reasons for why we are using that media and how it gratifies our individual needs. A behavioral targeting campaign might "know" that in addition to visiting sites that feature Porsche cars I also visit Porsche blogs and pages promoting Porsche paraphernalia. By the time I visit the online new's auto section, behavioral targeting has zeroed in on what my uses -- and, therefore, gratifications -- will be by visiting this site: I receive an ad that offers me a deal on Porsche merchandise.
In contrast, you have visited pages about industrial design and automotive design, and receive an ad about a new design exhibit at The Smithsonian.
Finally, the third person has been actively surfing the web for the best deals for a Porsche. She has been in the market for about three weeks and has been visiting several research sites such as KelleyBlueBook.com and Edmunds.com. Behavioral targeting has picked up on this internet usage and places an ad for an amazing financing deal from Porsche.
What were unimportant nuances with limited effects and not even thought about with the Magic Bullet theory have tremendous implications. By understanding usage, behavioral targeting enables advertisers to gratify users' needs and aligns with the most current thinking on how people really interact with media.
The evolution of online advertising is a great reflection of how academics study the mass media. As media people, we're guilty of ignoring theoretical perspectives because, well, they're theoretical. This experience reminded me that, every now and then it's good to take a look at how both worlds operate because you'll find that they are more closely related than we might think.
Bill Gossman is president and CEO of Revenue Science. Read his full bio.
