INSIGHT: Rise of online means days of hit-and-miss advertising are fast ending

Advertising as an attempt to persuade people to buy things is as old as the hills and it certainly predates by millennia the print and electronic delivery technologies that became so powerful during the last century.

The first thing to acknowledge is that the major established ad serving technologies are ageing. The product functionality enhancements needed to update them have become impractical to develop and so older platforms must inevitably be phased out.

Cloud computing capabilities, which can offer so much in terms of flexibility, cost savings and operational freedom, have not yet been sufficiently embraced. The same is true of other advances in data collection, storage and processing.

The result is inadequate and even poor connection between the applications that are involved in selling and delivering ads, preventing publishers from seeing the big picture.

For example, an ad server might be able to report the numbers of impressions delivered, but if that data isn’t integrated with analysis tools, there is no reliable way of understanding if impressions were sold at the optimum price or if the inventory could have been better packaged to maximise value and performance. It’s a case of the publisher flying partly blind.

Server shortcomings…

Another shortcoming is that older ad servers haven’t been able to recognise visitors according to their demographic profiles, preventing publishers from serving ads appropriately.

If servers have built in behavioural and contextual targeting capabilities, however, they can tailor ad experiences for specific demographics. This means that a given inventory can be sold in different ways to different people.

Publishers who can’t do this will be even more disadvantaged as newer ad content types such as streaming video proliferate and turn inventory management into an ever worsening nightmare.

And then there’s competition. Whereas in the print media industry the cost of entry is often prohibitively high, working with websites is comparatively much less expensive.

Websites can also be got off the ground quickly, and with new ones being launched all the time, competition for advertising dollars increases without pause.

Traditional publishers with outdated ad servers won’t be able to keep up, not least because they are no longer the only contenders in their space. Popular social media sites and mobile apps are offering attractive options now as well.

While it’s true that many different tools and facilities can be deployed to meet these challenges – things such as targeting applications, market research, inventory analysis, workflow and CRM software – a piecemeal approach is not the right answer.

To optimise processes and maximise profitability, publishers need solutions that offer true advertising intelligence with an approach that makes data readily accessible, turns data into insight and provides fast and easy-to-use analytical capabilities for good decision making.

With such an approach, publishers make more profitable use of both their server infrastructures and ad inventories, website visitors see more relevant ads and advertisers enjoy much improved returns on their online advertising investments.

Intelligent advertising is truly a win-win-win business scenario.

By Geoff Beynon - General Manager, SAS Institute New Zealand - a business analytics software and services company

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