I had the pleasure of participating on a panel at Digiday:Target this week in NYC and it occurred to me that behavioral targeting has reached its current acme because of one thing: data. Data is the foundation that we use to build audience segments that deliver relevant and effective advertising to Internet users, and as online communications grow and evolve, data is becoming more abundant and more accessible. Which forces us to question…how does this evolution of data and how it is gathered, stored and protected affect the future of behavioral targeting?
More access to data can most certainly mean better targeting. However, it's not as simple as it may seem. There are so many outlets for online consumer data such as shopping, browsing, social media, etc. that we could drown in the sheer abundance before putting it to any real use. A major challenge will lie in not only analyzing, but also in qualifying data and making sure that accessibility solves issues rather than creating additional confusion.
To measure quality, as well as validate that advertisers are actually receiving the data they think they are getting - the first step is to truly understand where data is being generated, how it is being collected, and how it is being aggregated to provide value. Our industry is famous for making these kinds of problems laborious. There must be a level of transparency that breeds understanding. Quality should be measured by both origination and performance. One without the other will not provide a clear, comprehensive picture, and could hinder scalability.
Once data is analyzed and qualified, the next challenge lies in ownership and valuation. There has been lengthy debate over who should own the data created by online advertising campaigns – users, publishers, advertisers, networks? To put it simply, I believe that the entity that CREATED the data should own it. From there, it is a business issue to determine how it is used and how compensation is handled.
Agencies certainly can be sophisticated enough to acquire their own data and leverage it as they see fit, however, most agencies do not have the time or resources to spend on technical innovation. It is likely they will need to partner with technology companies to provide the appropriate tools and infrastructure to own and manage data. There is also some concern expressed by agency clients in terms of who really owns and manages the data. Many large advertisers are resistant to agencies building data assets on their dollars. That said, agencies are going to need to become very sophisticated in terms of understanding audiences, and how to message to them in a more granular way, to provide continuing value.
When it comes to assigning monetary value, we will certainly see data priced independently of media; however the real value of the data will be in combining it with media to provide relevant messaging to consumers. In other words, it will be priced independently, and will not provide targeting value in and of itself. No matter how it is priced, there will always be value in data in terms of insight and understanding.
