The World Business

If you've been involved in marketing during the past decade, you've probably noticed that things are a bit different since this whole 'online' thing got underway.

While being online has starting to become an 'ordinary' part of many people's day-to-day lives, the experience of being online is very different from any other type of popular media.

Those of us over the age of twenty clearly remember a world without the 'Internet'. Back in those olden days most media consisted of marketing channels to which the majority of the population flocked. In exchange for giving people access to this content, advertisers were given access to the people who came to visit. They tossed their messages in front of us as we wandered around hoping that something would catch our eye. Sometimes it did. Mostly it didn't.

Because these mass marketing models were based on 'quantity' and not 'quality' of consumers, there was an up-front expectation that there would be a tremendous amount of waste. Advertisers understood that even if they were targeting the very best demographic group for an offer the vast majority wouldn't even see or respond to the marketing offer.

For marketers, it was the safety in numbers advertising approach that kept them going.

This approach also trained us, as consumers, to understand that our direct involvement in the marketing process wasn't really necessary. The TV commercials would continue to run whether we watched them or not; the print ads would stay right where they were printed even if we didn't open the magazine or newspaper; the ad on the side of the bus would keep moving down Main Street would keep going even if we ignored it.

But the arrival of the online world started to change things and pretty dramatically. Consumers now have millions of "channels" to choose from and advertisers have fewer places where they will reach mass markets. In fact, the very structure of the Internet means that consumers don't even need to look at or interact with advertising anymore...unless they really want to.

Culturally we've developed a number of ways to share information with one another. We've also learned how to customize messages so that they reach specific people. We never pick up the phone and think 'Okay, I need to talk to every person on Earth. What's the number?' We don't send an email to everybody in the company every time we have a thought to share with Sandy in accounting.

When we start any new marketing campaign we need to first think about who the campaign is trying to reach. What is the ultimate goal? What is the campaign saying? What obstacles can get in the way of the right consumer receiving the message? What should the consumer do to take advantage of the offer?

In the past mass marketing has represented the ultimate delivery mechanism for advertising messages but paints the audience with such a broad brush that its goal of reaching the right people can't be efficiently kept. To be truly effective, a delivery system has to reach the greatest number of individual consumers who can take action on the message being sent.

The bottom line is that a message that reaches 1,000,000 of the wrong people isn't more effective than a message that reaches a single right person.

The ultimate goal of effective advertising is to maximize effectiveness while reducing waste. Correctly targeting a campaign means first identifying who the best people to receive a particular offer are and how to go about identifying where they are.

When we target online audiences that are three primary areas of exploration:

1. Contextual targeting
2. Database targeting
3. Behavioral targeting

Let's take a closer look at the differences between these three areas.

Contextual Targeting

The simple definition for contextual targeting is the placement of messages where the people most likely to be interested are most likely to see it. Contextual targeting is perhaps the oldest type of targeted marketing. For years, trade magazines, area newspapers, local television stations and local radio stations have served as channels for contextual marketing campaigns.

Because each channel caters to a specific range of the population either based on topic interest or region, advertising using contextual targeting has generally meant reaching an audience that has already been 'filtered' down to a common interest or locale.

In online marketing, contextual marketing works in a similar way. Many web sites focus on, or have sections that focus on a single or limited range of topics. Like trade publications, these sites attract a self-selected audience who share a common interest whether its butterfly collecting, paintball battlefield strategies or exploring the validity of UFO sightings. For advertisers looking to communicate with these specific groups, good targeting is as easy as placing topically relevant ads on those pages.

Demographic Targeting

Demography covers a broad range of ways a population can be sliced up to define certain segments. A few of the more traditional segments include:

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