The digital advertising, a continuous disruption
In many ways, as advertising has gone from traditional media to new media, it has not changed very much. The idea of advertising via posters was simple: buy enough of them at the lowest possible price per poster and get them out in as many places as possible, so it was about two things: volume and price.
Advertisers were searching for the highest possible volume at the lowest possible price. In the same direction came newspapers, magazines, radio, and the same sort of growth happened with TV.
Marketers repeated always the same formula shaping it for the different types of media, creative agencies came up with clever ways to get the message across and also utilized new media like the video for TV commercials and audio for radio, but the idea remained the same: delivery message to as many people as possible at the lowest cost.
Despite dramatic advances in digital media, devices, and new types of media like social media, most digital ads today don’t look very different than the billboards that have been around since the beginning of advertising, for instance, banner ads are simply sized down versions of billboards.
Digital media presents immense opportunities to not only make significantly more functional billboards but also smarter billboards that understand consumers’ interests and tailor advertising and messaging directly to their needs.
The vast amounts of data we now have are about to improve this aspect of advertising, in order to be more personalized and relevant. Many factors come together in recent years to create this opportunity: technological aspects, consumer behavioral changes, and the widespread use of social media.
The biggest change in consumer behavior has been a greater willingness to share personal information, social media played a fundamental role, people now share online anything and everything, including who their friends are their likes and dislikes, their interests, and habits.
This is a big cultural shift in thinking to a general openness to sharing personal information in return for a more personalized experience.
Many years ago, people worried about others tracking them and sharing their own information, today we let apps like Uber, TripAdvisor, Instagram, and others freely use our location to help us quickly get a car service, make reservations to restaurants nearby.
We also deliberately check-in in many mobile apps, telling everyone, where we are the rapid proliferation of mobile devices, has essentially served to personalize our digital media consumption, today people prefer to have their own personal offers of films and TV content using Netflix, instead of watching what is on TV, and rather than listening to the radio, people subscribe premium Spotify accounts to listen to their own playlist.
In addition to mobile devices becoming personal media devices, they also became sharing devices. Through the use of social media, personal devices produced a billion locations, preferences, and other kinds of data shared by users.
These data and “new data” produced by wearable devices and by the Internet of things is a treasures that companies can use to personalize experiences.
Computing power and bandwidth have also increased to a point where tasks that used to take several minutes to hours can be now done in a fraction of a second.
Cloud computing has also significantly reduced the costs of storing and processing the massive amounts of data needed to effectively personalize advertising.
In marketing, data has always been viewed as something to analyze in a second moment, doing a post-analysis on the campaign results, research, and sales data trying to understand how to market to their prospects and customers, data was not used for targeting and personalizing experiences for customers.
Nowadays marketers view data as a strategic asset that has to be utilized as a key part of the marketing process. The investments in data and analytics are likely to get marketing teams the kinds of information they can use and rely on to deliver personalized services to their customers.
In the past year, Oracle Corporation acquired BlueKai and Datalogix, two Big Data companies focused on providing data for targeting and personalizing advertisements. This reflects the growing appetite marketing organizations have to spend on marketing technology and infrastructure.
APIs (application programming interfaces) have been significantly important to the rapid evolution and adoption of technology in the media and advertising industry. The successes of Facebook, Apple, and Google as media/technology companies can definitely be attributed to their heavy and aggressive investments in APIs that have allowed third-party apps and platforms to plug into and help grow their ecosystems.
In the digital advertising arena, APIs have played a key role. An API called open RTB has been largely responsible for the ability of brands to buy and sell media programmatically. This API allows sellers and buyers of media to communicate electronically about the availability of inventory, ask and bid prices, information about the inventory itself, etc.
All this has been done using a set of standard APIs, and it has enabled programmatic media buying and selling to scale and gain adoption rapidly despite the varied media suppliers, supply-side and demand-side platforms, and exchanges that are invariably involved in such media transactions.
In the world of personalized advertising, APIs can now tell us everything from where a user is located to what the local weather is like to what movie theater is playing a particular movie. All these APIs serve up data that can be used for more effective personalization.
APIs also allow for interoperability and ease of integration between the pieces of software that have to come together to make personalization work. For example, most data management platforms have APIs by which dynamic/personalized ad platforms can fetch data to personalize ads. Brands have been inspired by the way Facebook and Twitter have been able to offer them ad products with very fine-grained targeting and real-time messaging capabilities. Today, within a few minutes, a brand can think up a message or creative idea it wants to communicate to a very specific audience and have it sent to that audience within minutes.
The question many brands are rightfully asking is “Why can’t I do this across all my media?” For various reasons, including especially the limited types of ad formats offered by social media platforms, brands want to use those same techniques of micro-messaging and real-time marketing across their display advertising.
Marketers are also realizing that the traditional path to purchase has changed significantly due to the impact of social media and mobile devices. Now consumers can make purchase decisions in real-time without following the traditional paths to purchase.
This means brands also have to be able to be in that purchase path in real-time with something to say or offer that will tilt the purchase decision in their direction. A lot of the key ingredients are in place to make personalized advertising a reality, so what’s missing? As in any other emerging area in digital advertising, there’s a lot of confusing terminology and technologies, as well as a lack of APIs and standards for how data, content, and ad serving platforms come together to make it all happen.
This is all changing as we speak, and it is already evident that marketers are taking this opportunity head-on and collaborating with technologists to make their desires a reality.
Source: Diaz Nesamoney, “Personalized Digital advertising”, 2015
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