With the Internet becoming a preferred channel to target consumers, advertisers are looking to analytics to sift through copious amounts of data for insights into individuals' wants and needs. What's required is an integrated approach that not only collects data about individuals' preferences, behaviors and demographics, but also can leverage it to develop the right offer for the right person at the right time.

It should come as no surprise that investments are moving from traditional to online media channels at an extremely rapid pace. According to Advertising Age, some of the largest advertisers in the U.S. will shift half of their $1 billion-plus budgets to digital media within the next three years.

This trend will only continue. In 2008, 29% of consumers' media time is estimated to be spent online, but Internet advertising represents only 8.5% of total advertising spending. This gap will close as advertisers shift to more online spending; however, the question of how to best monetize online channels will increase in importance. The growing emphasis on the Internet also poses a number of other challenges for advertisers:

	When to target
	Where to target, and most importantly
	Whom to target

As more money moves to online channels (new media), fundamental business model changes are occurring for media companies, advertisers and Internet players.

Now and then
Traditional media companies are under pressure to find new forms of revenue to counter the flattening of traditional sell-through models for their media. The opportunity for these players is to effectively monetize their digital content through ad-based business models. Advertisers are looking for measurable return on investment (ROI) for their ad spending, and Internet players are competing aggressively to become the intermediaries to offer improved targeting and more attractive prices to advertisers.

For years, advertisers have used demographic data to target potential buyers of a product or service. And although an individual can have multiple behavioral profiles at any one time based on how they interact across channels, traditional segmentation approaches put groups of people in broad categories based on this type of data.

New media approaches, on the other hand, allow the creation of profiles based on behavioral information. For example, a person can interact as a parent, an active trader, a gamer, a cook or any of dozens of other profiles. This leads to the ability to create thousands of micro-segments that ultimately are more valuable to advertisers.

While this approach is successful and valuable to advertisers because it enables more precise targeting of relevant advertising and content to consumers, the amount of data available about online users is overwhelming. A key challenge is to convert this mountain of data into valuable information that will help drive behavioral insight.

As we move to more integrated multi-channel consumer advertising, the volume and complexity of data will increase, and the ability to monetize and manage this information effectively to provide real-time intelligent insights becomes crucial to increase new media advertising revenue.

A complete approach
Worldwide advertising waste, defined as money spent on messages that reached the wrong audience or none at all, reached more than $200 billion in 2007, according to ZenithOptimedia's Global Advertising Analysis. As a result, companies need a targeted and integrated approach to increase the share of their online advertising dollars—a solution that goes beyond just using basic transaction, audience and demographic data to include insights into consumer behaviors and preferences across all channels.

Such a solution would address the issues associated with collecting different types and huge volumes of data across multiple channels and, more importantly, help advertisers target the right individuals across relevant channels at the right time. Ideally, a packaged data sourcing approach would include the industry's most comprehensive media, entertainment and advertising data model, providing the foundation for the integration of this detailed data.

Advanced analytics is the most valuable component of such a system. With the ultimate objective of developing and delivering highly relevant audiences to advertisers, the solution should bring together the following key components:

	Detailed visibility of an individual (based on an anonymous profile to protect privacy)
	Powerful analytics engine
	High-performance modeling and visualization tools
	Ability to continuously run these models and dynamically update thousands of micro-segments

The result is an environment where thousands of audience micro-segments can be created and continuously updated based on real-time individual behavior. These micro-segments can be delivered via ad management applications, in real time, to channels for both advertising and content targeting. All of this would be accomplished without copying or moving data to intermediate systems.

The final component of the solution would be reporting and analytics to provide a single, integrated view of the targeting metrics, advertising management, inventory, orders and sales applications. It would be the unique place where detailed reporting and analytics showcase the transparency and level of measurement not previously possible.

Hit the mark
Such a solution, or some form of it, is fundamental to driving an ad-based media delivery model for media sales. It allows for better effectiveness of advertising spending and positively affects consumers by providing greater relevance of both content and advertising, which in turn supports the further adoption of ad-based models.

The benefits are numerous for all players involved in new media advertising: content distributors, carriers, ad agencies, advertisers and ad networks. A solution that provides deeper capabilities for companies, attaining intelligent insight from the growing volume and complexity of data, will allow them to drive higher advertising revenues and enable new business models through more accurate real-time targeting of content and advertising. T

Tim Bridges is a vice president and the Media and Entertainment Practice leader for Capgemini in North America. He has 23 years of experience in the deployment of leading-edge technology to solve business challenges.

Teradata Magazine-December 2008