Posted March 25, 2010 11:39 am by with 8 comments

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Sounds scary doesn’t it? Well, apparently behavioral targeting is music to advertisers ears because the technique works. Of course, this very same practice is what makes the hairs on the back of the neck of government regulators stand on end. The controversial and growing practice is going to be around though until it is asked to leave the building. Why? It converts.

cnet tells us some more

Want to get digital-policy regulator types fired up? Start talking about behavioral ad targeting, the business of serving up digital ads that are fine-tuned to a user’s Web surfing habits, and you’re sure to get all kinds of wildly varied opinions about privacy and sensitive data.

But a new study from a group called the Network Advertising Initiative, or NAI, claims that behavioral targeting is more than twice as effective as non-targeted ads, and the inventory from behavioral ads is worth double that of their non-targeted brethren. The study found that 6.8 percent of people who click on behaviorally targeted ads turn into buyers, versus 2.8 percent of those who click on non-targeted ads.

Ok, so let’s review. Companies will pay top dollar for this kind of advertising and it converts at a much higher rate to boot? Many advertisers are starting to say “Sign me up!”.

Let’s also look at the source of these numbers as we try to always do here at Marketing Pilgrim. The National Advertising Initiative’s About Us page tells us that

The NAI (Network Advertising Initiative) is a cooperative of online marketing and analytics companies committed to building consumer awareness and establishing responsible business and data management practices and standards. As increasingly sophisticated online advertising technologies evolve, consumer concerns about their impact on online privacy mount. The NAI is prepared to meet these concerns with both effective industry self-regulation and sensible protections for online consumers.

Gee, a rosy picture of an online advertising technique from a group that is made up of online marketing and analytics companies. Hmmmm. The group has also been around since 1999. That’s ten years and more questions than answers thus far.

Since 1999, the NAI has been working with the online advertising industry to provide consumers with clear explanations about data collection, data usage, and choice. Central to our standards are the privacy concepts of notice, consent, control, and dispute resolution.

Looks like industry folks must be missing some of these meetings considering the high degree of government and consumer concern about just how vague most online privacy policies are and the trouble that is created by these less than clear policies.

Once again we are faced with the interesting dilemma of an industry where everything is supposedly tracked to the nth degree. This tracking and gathering of boat-loads (hat tip to Carol Bartz!) of data creates the classic double edged sword that cuts in both directions. In addition, statistics were made to be manipulated just as much as records were made to be broken. this has resulted in many more questions than answers over the years and that is not likely to change anytime soon.

So if you are using behavioral targeting in your marketing efforts the NAI is just the organization for you. As for the future of this practice? That’s anyone’s guess because it’s effectiveness is based on knowing so much about a person that you can predict with greater accuracy their propensity to buy a particular product or service. While this may sound incredible to a marketer it may sound scary to others. It’s the others that marketers should pay very close attention to.

Any thoughts on behavioral targeting and the ‘too much information’ possibilities?

  • S13g

    Myspace and Facebook are all ready an example of this. Say a couple things about being over weight or mention being single and watch as the whole site changes to a get ripped in 4 weeks with a 12 foot long penis and a new girlfriend adds.

  • Yes, we too believe that us the web viewers’ behavior is being targeted for marketing purposes.
    .-= Web Guru´s last blog ..Global fight against Polio =-.

  • I think it’s pretty effective, if done properly. I have been bombarded with adverts on social networking sites that are loosely related to what me and my friends have been talking about, and these are the only ads I get. But as they’re only loosely related, I have no interest in clicking on them, so it’s a bit wasted on me.

  • I think behavior targeting is effective and actually prefer it. Lets face it, there is no hiding from ads, we are exposed to thousands a day. At least with behavior targeting the ads are usually more related to our interests. What is creepy is there have been new tests being done with neuron technology. There our companies out there that are monitoring brain activity while people look at certain website. It is coming down to the how people react to the other and even button designs. So advertisers are trying to get more and more accurate targets.

  • Honestly, I think that Google’s big announcement today about Adwords retargeting (or remarketing, as they refer to it) can only mean good news to advertisers and consumers. Think about it – if used properly, retargeting can help advertisers streamline their campaigns and better focus on their target market, while consumers benefit from being presented with promotions and discounts for products that they actually like and can use.

    To answer concerns about privacy, there are tools that can (and should) be used when a company chooses to utilize retargeting, such as frequency caps to prevent from bombarding consumers and annoying them.

    With the right balance, retargeting can add tremendous value to an advertising campaign. It’s a win-win, if you ask me.

  • GooLung

    As long as they don’t associate your personal behavior with a name in a database, i don’t think this, in and of itself, is too invasive.

    Privacy to me is a really bigger issue than behavioral targetting marketing. Offline or online, privacy is a really serious issue today. Identity theft can be a concern. Your reputation can be at stake. The government is getting more and more intrusive too. Between sites like and how much power facebook and google have over your life, I’d be concerned about how much private information about life leaks out that I don’t want to be known.

  • It’s not just the targeting by the search engines for advertisers, it’s also the fact that it’s so difficult to get out of Google search.
    .-= Winchester Web Design´s last blog ..Creative Agency WLTM Amazing Project Manager =-.

  • Jas

    I agree with the fact that retargeting can help advertisers more aptly connect with their target market. If visitors are already interested a product, why not try to retain their interest for longer? It’s a smart idea.

    I can also see why people have concerns, but when retargeting is done appropriately it can be very beneficial for both consumers and advertisers alike. It’s all about knowing your limits. As much as you want to sell, sell, sell – you have to find a balance that benefits you and respects the consumer. Here’s a great article on taking a less “creepy” approach.