Datran Media's Scott Knoll discusses the pros and cons of current BT tactics, as well as the impact that looming legislation could have on the sector.

Behavioral targeting is playing a more prominent role in many online marketers' campaigns, but the BT model is hardly a unified or static one. What's more, looming state and federal privacy initiatives could have a significant impact on the sector -- especially if potential legislation is painted with too broad a brush.

In this interview, Scott Knoll, senior vice president of display for Datran Media, examines the current shape of the BT landscape, as well as the impact that overly expansive legislation could have on online marketers.

iMedia: The variety of BT platforms and alternatives out there is tremendous. From your point of view, what are the high-level distinctions among BT models? And what kinds of data do you use in your model?

Scott Knoll: Behavioral targeting is a nebulous term in the industry these days, and the interpretation of what constitutes an online behavior deviates substantially across platforms. The difference comes down to how much data you have on a particular browser and how clearly the data defines that consumer. It's easy to believe that surfing behavior equates to a consumer's interests, but it's not always that simple.

For example, many platforms assume that because a consumer visited a car site or looked at a car ad, she is in the market for a car. Therefore, her browser is tagged with an "in-market-for-car" cookie, and she will receive ads from every automobile company from Mercedes to Hyundai. In this scenario, the data does not indicate if the consumer has the means to purchase a Mercedes. Datran's unique advantage is in the fact that we have figured out a way to aggregate more audience data than anyone else. By developing a completely anonymous way to marry behavioral data with rich household-level demographic data, we can do a better job of matching Mercedes ads to the people in the market not just for a car, but a luxury vehicle.

We derive our behavioral and lifestyle data from real online and offline requests for information or transactions, and obtain our household-level demographics and interests from the most informative and accurate direct marketing databases available. We feel that the combination is unprecedented and unbeatable in the marketplace.

iMedia: With the tremendous amount of data that can be tracked online, some marketers and their clients are suffering from information overload. From the BT perspective, what are the most meaningful metrics to be tracking?

Knoll: I believe the reason some advertisers get overwhelmed is that they are looking at the wrong metrics. In each product service category, the marketer must decide which metrics are most applicable. The industry has a bias to look primarily at clicks and conversions for all advertisers because these are easiest to measure. However, CPGs and brand advertisers with large online budgets will find value in BT, but click- and conversion-related metrics are generally less useful. These types of companies are more focused on other metrics such as target audience reach and brand interaction, as well as recent purchase history.

For this reason, Datran has focused on building a platform called Aperture that accurately measures the attributes of the audience in addition to impression, click and conversion metrics. We can provide the advertiser with an accurate picture of the specific audience that saw and interacted with each of its ads. This audience is measured by variable and customizable metrics applicable to each marketer. These insights not only define and track audience metrics, but also help shape future marketing and even product decisions.

iMedia: In your opinion, what new technologies, capabilities or market forces are going to have the greatest impact on the shape of BT in the next two years?

Knoll: BT needs to become more applicable to a wider array of products and services and more scalable in order to become a significant method for buying and targeting media. Instead of restricting BT to tiny granular segments or limiting it to a few demonstrated categories (e.g. auto) or to remarketing, we believe the future of BT is combining behavioral data with additional audience insights.

Accurate audience data such as gender, family size, age and income can not only shape targeting decisions, but creative decisions as well. For example, it's interesting to know that someone frequents travel sites looking for airfare and hotels, but that becomes a lot more interesting when you also know that he has three kids and a high income. Now you can target his browser with ads for high-end hotels and family vacations instead of just discount travel. Furthermore, targeting on the same in-market travel shopper criteria, a credit card company can show its platinum card to one segment and its basic card to another.

The inclusion of audience data not only broadens the appeal of a generic behavioral category like travel by creating more targeting options for endemic advertisers, but also helps the BT category become attractive to non-endemic advertisers.

iMedia: BT has been put in the crosshairs by some state and federal privacy initiatives. If some or all of these initiatives are legislated, what implications would they have for the future of BT and the interactive marketing industry at large?

Knoll: Our concern with any legislative initiatives is that they possess the potential to be overly broad. As we saw with email, poorly constructed laws can substantially harm the complex internet economy without any obvious offsetting benefit.

We hope that legislators will be careful and well thought out in their approach to regulating behavioral targeting, for overly broad, poorly refined legislation can harm the advertising that drives the internet without significantly protecting consumers from deceptive and predatory behavior. That stated, we are definitely in the wait-and-see stage.

iMedia: Is Datran participating in the dialogue surrounding these legislative privacy initiatives? If so, what's the takeaway message behind your stance?

Knoll: Datran Media has been a strong participant in the legislative debate. We would support any carefully drafted legislation that targets deceptive and fraudulent behavior, but we agree with the Federal Trade Commission that strong-industry regulation is the wisest path. Given this, Datran Media has approached behavioral advertising with the belief that consumers should be provided with robust notice surrounding the intended use of their data while being giving the opportunity to object to such use.

Editor's note: Scott Knoll will participate in "The Future of BT" Master Class at the iMedia Agency Summit in La Quinta, Calif., on Dec. 9.

Lori Luechtefeld is editor of iMedia Connection.