Zillow.com predicts next move for behavioral targeting

There are three basic ways to advertise online: Pay-per-click search ads on Google, Yahoo and Microsoft; banner ads on brand-name sites such as iVillage and USA Today; or behavioral targeted ad networks that run your banner on hundreds of sites, but only to users who fit a specific profile. We’ve found behavioral targeted banner ads outperform regular banner ads with click-through rates 400% or 500% higher.

Still, many clients are uncomfortable with behavioral targeting, and often push media planners to take a “safe route” with a well-known site. We’ve had clients insist that iVillage.com (a very strong site, yes) is the best place to run banner ads that target women. iVillage may be the No. 1 property for women on the internet, but in a horse-race, behavioral targeted ads that match specific women profiles generate click-throughs above 0.70%, while iVillage click-throughs fall below the industry average of 0.14%. It all points out the trouble with online advertising–chasing specific sites is no longer as powerful as chasing specific consumers.

Zillow.com points to a new way for advertisers to get both the brand-name site and the targeted benefits. Zillow is launching a behavioral targeting service online within its web site–which lists 80 million home values in the U.S. and has become a popular pastime for homeowners checking out their neighborhood property values. Zillow claims it has gathered enough data to now predict when consumers are about to buy, sell, or remodel a home.

Industry analysts say this is a new class of online advertising: vertically targeted content meets behavioral targeted demographics. If it works, you can now pinpoint only the web site users that fit a very narrow profile–say, women in their 30s with young children who are about to move into a home–and put your ad within the vertical content that best matches your brand.

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