Posted May 16, 2007 9:39 am by with 2 comments

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“Imagine an environment where the company that makes dentures and denture products only advertises to people who don’t have teeth”

And that, dear pilgrims, sums up perfectly The New York Times’ look at the resurgence of online display advertising, now that companies are able to better target which ads are shown to site visitors.

Of course, those of us lucky enough to still have our molars and incisors shouldn’t feel left out. The NYT explains how improved technology is allowing many start-ups to enter the online display space.

Industry analysts estimate that there are about 200 such companies. Many call themselves ad networks, while others are referred to as ad exchanges or optimization services. The roster includes Revenue Science, Tacoda, Tribal Fusion, Rapt, AdECN and x+1. In one way or another, they are all trying to bring more effectiveness to the online display ad market.

Gone are the days of visiting a site which can do no better than to show you an ad which encourages your to upper-cut a primate. Instead, banner ads have matured and ad firms have developed better targeting technology.

The new science of online display advertising involves a potent mix of behavioral targeting, social networking algorithms, predictive economics, pricing optimization and other mathematical strategies.

Of course, there’s only so much you can expect out of online display ads. Consumers are still very guarded with their personal information – which would make online display ads even more effective – and until someone figures out how to pry that information out of them, targeting is still going to be very much a “best guess” effort.

  • Andy, where do you see online advertising heading? Obviously the move to better targeted ads has improved things for publishers, advertisers, and viewers. Do you think the trend of more specific of advertising or niche advertising will go even further?

  • I think we’re just seeing the beginning. I think you’ll see many advertising not willing to fine tune their PPC campaigns further and will instead look for where they can spend money next – online advertising is going to have a huge resurgence.