Category Archives: internet marketing

Why marketers know if you’ve been naughty or nice

santa watching

There is a story about a jolly old elf who tracks your behavioral data carefully, spies on you even when you’re sleeping, and runs algorithms to assess whether your actions are more positive or negative than social norms. Based on his calculation, the elf will reward you with financial gain in the form of material goods or will deduct from your status by tricking you with what looks like material goods but in reality turns out to be lumps of coal. The system is extensive, including a database of every youth in the world, and is updated annually. If you don’t like this surveillance, good luck: The elf’s privacy policy is unpublished, the observational data cannot be accessed by individuals, and your only recourse to correct misinformation is to send handwritten postal mail to the elf’s address at the North Pole.

Perhaps these childhood stories are why people often freak out about data. The legends of people recording others’ actions, especially those of children, as a form of behavioral modification have been with us for millennium. In Bavaria, the Santa myth is actually split into two figures, a Saint Nicholas who rewards good children with gifts and a devilish, horned Krampus who punishes bad children. Japan has a similar tradition, with an Namahage figure played by men wearing huge, ugly masks, who knock on doors and warn children not to misbehave. Religion is filled with data tracking, starting with God watching Adam and Eve’s naughty apple-biting in Eden, moving on to the widespread but vague idea that somehow all of your actions in your lifetime are being observed for a final post-death judgment. In our deepest beliefs, we perceive there is a connection between what we do, how others record it, and how we will be rewarded.

Which brings us to marketing surveillance 

If you collect enough data to form a baseline for comparing people, you end up with a “database” — and this idea has been around for at least 400 years.  In America in the 1600s, clergy tracked births, marriages and deaths; officials called “tythingmen” would also enter homes to inspect families for observed moral behavior. The first consumer database in the United States was set up in Massachusetts in 1629 to track property ownership. As data expanded, intrusions did too. In the early 1700s, U.S. postal mail was opened regularly to spy on message content.

And then marketers figured out they could make money from all of this information. Database marketing started in the 1940s, first driven by direct-mail marketers (who needed target lists of consumers to mail things to and then calculations to see what worked), later by credit-card companies and banks (who rapidly learned that not all consumers have the same credit risk), and then in the 1990s by Internet marketers who realized they could measure a treasure trove of consumers’ online behavior. While the basic approaches are the same — identify potential customers, differentiate by their value to you and what they need from you, continue to gather more information through interactions, and then customize your response — the cycle time of data marketing increased. Direct mail list updates used to take months; if you purchased a pair of boots at a store in December, it might be March before another company’s boot catalog showed up in your mail. But the Internet enabled a cycle time of identification, differentiation, interaction and customization within days, hours, and now even seconds. Visit zappos.com, look at shoes, don’t buy them, and you’ll see ads for similar shoes on other web sites within seconds. The prevalence of such digital “retargeting” has gotten so rapid that many consumers are beginning to freak out.

The systems are growing ever-more sophisticated. Digital media vendor Rocket Fuel has begun testing device fingerprinting to track consumers by their individual mobile phones; in a recent campaign for Brooks running shoes, it identified the mobile devices of everyone standing along the running route of the New York City marathon, and then later served ads to those devices for running equipment long after the crowds had dispersed to Baltimore, California or even foreign nations. Digital marketers can pick up the IP address of a home’s Wi-Fi connection, and then retarget multiple devices — based on a trigger of one person’s behavior — across the many iPhones, tablets and computers residing in a household. Creative-based retargeting is another digital approach in which banner ads or online videos can be retargeted based on a single ad appearing on any web page, whether or not a consumer clicks on it; for marketers, this provides the advantage of being able to “lift” a publisher’s audience, such as a reader of WSJ.com, and chase that individual around the web later with a pretty good idea of their demographic profile based on the original reading material.

Consumers are rebelling, so what is the balance?

Not everyone is happy about this. Early in 2014, a survey by Truste, a global data management company, found that 74% of Internet users had increasing worries about the use of online data. While only 38% expressed worry about government surveillance, 58% said they had concerns about business use of their personal information. Beyond simple consumer annoyance, the growing use of online data may actually be harming marketing results. 83% of survey respondents said they were less likely to click on an online ad due to privacy concerns. In a deeply ironic circle, the data collection sophistication used to make online marketing work better may actually be depressing response rates.

Smart marketers are recognizing this and beginning to tone down the creep-factor of retargeting, using tactics such as impression caps, dayparting, ad creative versioning, and opt-out options to allow Internet users more breathing room before they are inundated with braying offers.

Data tracking will not ago away, because it is how all of us assess the outside world to calibrate our actions. Marketing in particular is all about treating different customers differently, as the great Don Peppers once wrote — after all, if you have unique needs, you should receive messaging about products or ideas that appeal to your interests, and marketers who play this right will gain greater results from their advertising investments. Just as parents and Santa Claus watch over children to assess behavior, other people will always be watching you too. The practice isn’t creepy in and of itself; what has gotten scary is the instant cycle time it takes someone else to pass their judgment. For our clients, we recommend looking beyond just response and conversion rates to also assess the real end customer experience. You’re trying to share information that benefits the customer, so pace yourselves, people. Everyone likes an elf who brings presents, but we all get nervous if he’s watching us too much.

ObamaHillary.com: No takers?


The Internet 2.0 bubble is cresting. We can tell, because cyber-squatter Don Bowman is ending a five-day auction of the sweet URL www.obamahillary.com tonight. Entry bid is only $5,000. And with less than two hours left, there are no takers.

Cyber-squatting, as you recall, was hot back in 1998 right before Nasdaq went off a cliff into jagged rocks above shark-infested waters. People snatched up whacky dot-com names, hoping to resell the addresses for millions, on their way to investor meetings with PowerPoints about their unique CRM software solutions. (“Our spreadsheet will manage customer relationships!“) Fast forward to this month, June 2008, and a new URL designation called dot-me (as in www.believe.me, www.marry.me, you get the idea) is attracting more bids at domain registration sites such as godaddy.com.

Good luck with all that. If people won’t bet $5k that www.obamahillary.com is worth something, the bubble is over. Or … hmm … perhaps the wisdom of crowds is thinking there is no way Obama will take her on as VP.

(If you want to jump in, cruise to eBay by 12 midnight EST tonight.)

2008: The year web marketing moves into the woods


The Internet used to be a way for people to just find information. Now, it’s turning into a free platform for doing things such as connecting with friends, writing documents, storing photos and editing home videos — and that has radical implications for how you market online in 2008.

1. It is no longer enough to have a web site. If your web site is a cottage front door, your target customers are now off playing deep in the forest.

2. It is also no longer enough to rely on keyword search or SEO to hope customers find you on search engines. New, free web services allow people to “do” and not just “search.” And people will not find you online if they are not in search mode.

The source of this shift is amazing. Customers can now do things online that used to require expensive PC software. Picnik allows you to store and edit photos, Jumpcut edits videos online, Mint will balance your checkbook, and Google is rumored to be preparing a Gdrive online backup service for everything.

Chris Anderson predicts in The Economist’s 2008 outlook that free online services are the wave of the future, because technology, not strategy, is driving this. As the cost of storing and manipulating data falls to zero, it makes sense for service providers such as Google to compete with incumbents like Microsoft by giving utilities away at zero cost. Of course, these “free” online service models are supported by advertising. So paradoxically, even as interest may wane in advertisements that appear next to a free online widget — leave me alone, I’m balancing my checkbook! — the company that provides the free online service wants advertisers more than ever before.

The solution to this huge shift in how people use the Internet is to move far outside of your web site. Robert Scoble points out in Fast Company that U.S. presidential candidates are getting online marketing right by avoiding single web sites and instead casting a wide net to reach people as they do other things online:

Rather than expecting a Web site to be a destination all by itself, the candidates are employing what I call the “starfish” approach. A starfish has many legs radiating outward from its central core. It uses its legs to move toward its prey, which it will ultimately devour with one of its stomachs. The analogy should be clear. Social media–blogs, text messaging, video, and social networking–are the legs of your online strategy. Your Web site is the belly of the beast, where you convert visitors into customers.

The only way to get to someone who is not in search mode is to intercept them when they are doing something else.

We recommend to our own clients that they allocate at least 5% of their advertising budget to test a range of online communications in 2008 — keyword search on Google is a prerequisite, followed by behavioral targeted ad networks and tests with social networks and emerging widgets. Not every aspect of this new online ad portfolio will pay off. But it is vital to learn what works and what doesn’t as more consumers move their working lives and social connections online. Fail to navigate the woods, and you may never see these customers again.

When web ad measurement fails, build a ruler


We’ve been critical about broadcast, outdoor and print media measurement systems lately … but at least there is one ruling body in each of those media that tries to establish standards. A new report says the lack of consistency in online measurement may be scaring some advertisers away from internet advertising, especially as web media continues to evolve into video, widgets, and social media apps. This is ironic, because the web is awash in data … but often not all of the numbers add up.

For example, one standard of web audience is “unique visitors.” But if a user deletes the cookies on his computer, he comes back as a new unique visitor each time … so John Doe, battling viruses on his Windows PC, may get counted over and over again inflating a web site’s traffic report. “Uniques” also do not account for the same viewer logging in from different computers.

This is more than a nit: unique visitors are the baseline of a web site’s audience, the equivalent of reach in traditional media planning. If reach is off, what else could be?

Randall Rothenberg, CEO of the Interactive Advertising Bureau, put it: “Marketers want to know, If I take $10 out of TV and put it into online, am I getting $10-plus back?”

The cold hard truth is the advertising industry has been riddled with inflated metrics for years, and as the data systems get better (driven by the attempt to keep up with the flow of data from the web), a lot of old-school Emperors are going to realize they are wearing no clothes. Media can work, but only if you base your media plans on reality. If the reality is teenagers are leaving radio to listen to MP3s, let’s count it, and deal with it, not hide facts. If the reality is newspaper circulations are down, let’s not make up bogus “readership” claims based on passalongs, because that does an advertiser little good.

The only real solution we see is for marketers to bypass the competing claims by setting up measurement of inbound responses. If a marketer spends $10,000 on one outlet, and can track with accuracy that 200 responses came in, she will know the cost per response was $50 in that particular media. If another media option drives a response at $25, then that’s a better deal. As media options continue to proliferate, each channel will inflate and defend its own metrics, and silly claims will continue to rise. If you want the truth about advertising, measure it yourself.

Bulb burnout: The trouble with mnemonic URLs


So it’s Thursday night, kids are in bed, we’re watching the science channel and along comes the most brilliant Philips light bulb commercial we’ve ever seen. The screen fills with blue-and-white melting icebergs, then a young baby boy floating precariously on a shard of frozen H2O, and just when we expect Al Gore to nasally intone the world is ending, a warm narrator’s voice implores us to save the future by buying a Philips CFL bulb. The web site URL flashes on the screen.

We’re smitten. Yes, those old incandescent bulbs are wasteful. CFL bulbs — which look like spiral ice cream cones — burn 80% less electricity, and have come down in price from $25 a pop to a buck fifty. If every home in the U.S. swapped out just one light bulb, we’d save enough electricity to power 500,000 homes. Even Jeffrey Immelt is pitching this stuff, and he ought to know, he works 100 hours a week selling GE aircraft engines. We must join this cause!

So we march to the computer, start to punch in the URL … and dammit, we can’t remember it. The web site name sure was catchy. Something like www.lightupthefuture.com or www.savechildrenonicefloes.com or www.philipsprofitsfromyourguilt.com. Arg! Help! Somewhere, a baby boy on an ice shard is drowning. We could save the world, if only offline-online response mechanisms weren’t so difficult to remember.

Pssst: Your PR is showing


Public relations guru Jeremy Pepper worries in a recent post that PR is losing out to advertising over who really influences social media. As advertising gurus, we think the reverse is true. Public relations rules online, because only PR is truly relevant. We love online advertising when it works … but we see rising cries of desperation from many web campaigns. As evidence, check out the godawful home page to MySpace.com to see how their marketing folks have turned it into a screaming billboard.

You can’t “game” relevance. This is why SEO is so hard — web site owners try to link farm and content stuff to rise in Google’s organic rankings, but without true relevance, they’ll never make it big.

We’ve seen four basic public relations approaches required for online marketing:

– create news (Nick Haley’s Apple ad)
– break news (Huffington Post, a blog-turned-real media outlet)
– share news (Digg.com’s user rankings)
– comment brilliantly on news (Seth Godin’s blog)

In simple terms, to pull users to your content, make it relevant. Give away something of value to get the attention you want. Google pay-per-click campaigns really are a perfect form of sharing news that is relevant to users (who are typing in search terms for the product). To pull people to your other web content, you need to create the same near-perfect connection.

Public relations is sometimes seen as a dark, Machiavellian attempt to spin fiction to the masses. In reality, PR works best when it combines relevant truths with a story about a product or service that recipients may find useful. The internet is a perfect sorting mechanism to make relevance and truth rise to the top (which is why Wikipedia works so well). Media planning makes advertising work in the same way — a good media plan puts the right ad in front of the right consumers, where the consumer will find it relevant.

A question for marketers: Have your media planners, ad creatives, web designers and public relations advisors sat down at the same table recently? If they aren’t all talking, you may miss the social media boat.

Browsers get hungry, start snacking on software

The UK magazine Web Designer, a brilliant pub about web trends that perversely gives almost no content away on its web site, explains in Issue 136 how to move a web site outside a browser window — to take over the entire user’s computer screen. You’ve seen this at work at YouTube, if you hit “full screen mode” on the video.

This is much more than a design gimmick. If web sites can now go full-screen, and run programs, and store your data, then what is the point of desktop software? As this trend continues, companies that rely on PC-bound software (Microsoft) or PCs with complex innards (Dell, HP) are going to get hammered. All users will need is a screen, and everything else they want will be found online.

The impact on online advertising could be huge, since as content, utility, and storage move out of our homes or offices into the great wide web, it will become easier and cheaper for consumers to have multiple entry points into the internet. The screen in your car, the screen on your iPhone, the screen tablet in your briefcase, and the screen at the hotel lobby check in will all tie in to your online data systems. More points of entry, at a lower user cost, will create more time than ever before online. Facebook, for example, is really a new operating system that is housed online. You can run programs, communicate, store contacts, keep photos and files, all online — all you need is a screen to get in. Back in 1995, Facebook itself would have made a high-end computer.

All this, in turn, will continue the cannibalization of other media as consumers shift their routines to internet usage, vs. broadcast receptivity. To see full-screen web in action, check out papervision3d, which can turn your entire screen into a fish tank, or Sequence Post, a UK site showcasing high-end video work. More is coming.

Tina Fey: Please. Update your blog.


One of the perils of social media is that it is, well, social, and your network expects you to chip in constantly. Take Tina Fey. We all love her for her mind, dark humor, brilliance, and yes, those sometimes-on-sometimes-off-oh-so-sultry glasses, but when we stumbled upon her “blog” at NBC we were saddened to find only a dozen posts — all dated Oct. 4. A brilliant start, with candid insights about how to break in to comedy, the inside scoop on character development … and then it all goes dark.

Tina. It’s been weeks. We thought we had something special. Re-commit to us. Punch up the computer and type something witty, please.