Against a backdrop of low banner click-throughs and plummeting cost-per-thousand-impression (CPM) rates, the Internet's leading online campaign management firms are announcing moves they say will give advertisers more precise measurement and targeting, and greater reach.
The biggest news comes from AdForce Inc., Cupertino, CA (formerly IMGIS Inc.), a firm that serves banner advertising from a central location to hundreds of sites and targets the ads using registration data compiled by the sites.
AdForce, which said it passed the 1-billion-monthly impression mark in July for the first time, is expected to announce this week that it has raised $20 million from some new backers that include America Online. Under the agreement, AOL will begin using AdForce's same-named service to serve advertising to its 12 million-plus members.
Also, AdForce is planning by the end of the year to begin targeting banners using demographic and psychographic data supplied by Metromail, Lombard, IL, which owns a minority stake in the company.
Metromail's BehaviorBank consumer-lifestyles database covers 30 million people, and its main database — compiled from public sources including directory, telephone company, census tract, real estate, motor vehicle and private source data — covers more than 140 million individuals.
Chuck Berger, chairman and CEO of AdForce, would not say if AOL will let advertisers target specific consumers through AdForce.
“One of the things that our technology will be fully capable of is individual demographic and psychographic-based targeting,” Berger said. “AOL has not yet announced an intention to use that part of the technology, but the capability will be there for them.”
To protect consumers' privacy, Metromail won't reveal individual consumer names or addresses to AdForce. Berger said the AOL deal is part of a trend that signals online advertisers' preference for user-supplied information over data gathered by tracking behavior, as is the case with some of AdForce's competitors.
“We feel that using a database that was created by a site is a far superior way of targeting than [building profiles by embedding cookies on users' hard drives] and using predictive modeling to try and guess at what kind of person you are,” he said. “My 16-year-old son gets up every morning and goes to the Wall Street Journal Interactive, Barron's Online, Porsche and BMW pages. If you follow him on the Web, you might suspect that he is a business executive with the wherewithal to buy one of those cars, and he certainly is not. When you have actual databases, you can target based on who people really are.”
The folks at Engage Technologies and Accipiter disagree.
Last week, the two firms, which are subsidiaries of CMG Information Services, Inc., announced that they have integrated services giving users of Accipiter's on-site AdManager software real-time access to Engage's database of anonymous profiles of 24 million Internet surfers built using cookies.
“Registration data is a good source of information, but a lot of people don't disclose truthfully,” said Diane Elavsky, director of strategic communications at Engage, Andover, MA, “and we believe that [current] behavior is a better indicator of a person's future behavior, which is what you're really trying to predict.”
Engage's announcement comes on the heels of the firm having slashed the price of its Accipiter AdManager software in half in June. According to Engage, more than 25 companies have since signed on for its services, including San Francisco-based trade publisher and conference producer Miller Freeman Inc. for its 200 Web sites.
Engage also offers a central outsourced ad-management solution called AdBureau.
In other news, list firm Worldata's online media placement service WebConnect, and Louisville, CO-based online campaign-management firm MatchLogic Inc. (whose main client is General Motors) last month announced return-on-investment (ROI) tracking for online advertisers.
“Brand and direct marketers alike can now implement traditional media testing techniques on the Web and receive feedback within days rather than months,” said Pete Estler, president and CEO at MatchLogic, whose ROI tracking service is called TruEffect. “TruEffect will drive media testing and planning to new levels on the Web, enabling marketers to know exactly what their ad burn rate is with each customer and focus their buys and creative styles on the sites that provide the highest ROI.”
Referring to the Internet industry's seemingly increased recent focus on the term ROI, Roy Schwedelson, CEO of Worldata, Boca Raton, FL, said, “What these fellows have discovered is that they're in the direct marketing business. The next hot word will be measurability.”
WebConnect's ROI service is called ICS (Impression, Click, Sale). The service is free. Pricing for MatchLogic's ROI service was not disclosed.
