An advertising utopia
You listen to a financial radio show everymorning. You use an online orderingsystem to deliver your shopping eachweek. You watch property programmes on TV regularly. In the past month, you'vebegun logging onto property websites,and you've signed up with three onlineestate agents. You subscribe to a servicefrom your bank that texts your balance toyour mobile phone once a week. A few years from now, you are likely to bereceiving all these services through asingle broadband connection and webinterface. Call it your personalised Googlehomepage.Google knows your preferences in allthese areas. It matches your profileagainst others with similar preferences andchecks what ads these people haveresponded well to (measuring clicks, pageviews and phone calls in response to ads,for example.)Google sends you the ads you want toview, the ones that correspond to yourknown preferences. Its software deducesthat you may be interested in adverts formortgage lenders, surveyors or localremovals businesses. It sends these adsto the websites you visit, the programmesyou watch, the radio shows you listen to,and even the billboards you pass (it knowswhere you are moment by moment, fromthe signals your mobile phone sends out.) You're happy because the ads you receiveare relevant and useful to you, andbecause receiving them pays for yourbroadband connection - covering voice,wireless, data and entertainment. The advertisers are happy because theyare reaching the right people, in the rightplace at the right time, thus increasingtheir return on investment and decreasingthe hassle of dealing with multipleintermediaries. And Google is happybecause it is taking a slice of a muchbigger pie - total ad spend, rather than just online ad spend.Both advertisers and search engineoperators are driving towards thisconclusion. Yet few in the media-buyingand broadcasting industries seem to beacknowledging its imminence or preparingfor its consequences.
The consumer perspective
From the consumer side, there are twokey drivers: a trend towards making moreinformed purchasing decisions, and theuptake of high-speed broadband.Consumers are no longer convinced byglossy marketing speak. According to araft of surveys, they want detailedproduct information. Today, consumersdo more research online before buyingoffline, so that they can find the best of the best and the cheapest of the cheap. As a result, advertising is becoming moreinteractive, so that consumers can findmore of the information they want. Thered button on your TV and interactiveBluetooth posters at bus stops are justtwo examples of this trend. The next step is to link this productresearch directly to a purchasingopportunity. You could click the red buttonto go to a website and make a purchase. You could click an equivalent button onyour radio and pay to download a song toyour PC. You could scan a barcode on anewspaper ad that catches your eye tocall the company for more information. And this could be via a free Voice overInternet Protocol (VoIP) service on yourmobile phone. All these mechanisms give you moreinformation more easily. But yourresponses also help anyone tracking yourbehaviour to build an increasinglydetailed profile of what you want. Withthis they can target you with ads youwant to see, which makes for moreeffective advertising. You can imagine a recommendationengine, much like Amazon's book-recommendation technology, whirringaway in the background serving you adsthat others with a similar profile respondedwell to.
A single broadband hub
But how could one bit of software trackyour behaviour across so many differentmedia and communication channels? AsPCs, mobile phones, televisions, andradios converge into single devices, on asingle hub, this becomes possible.Consumers in the UK are clearly movingto adopt this kind of technology. The UKhas seen a phenomenal uptake of high-speed broadband - broadband which isfast enough to cope with downloads of pictures, music, and video without makingyou wait too long. With 62% of thepopulation now online, 71% of thoseconnections are broadband
. Internetservice providers (ISPs) are drawing
Converging technologies are transforming the way we communicateand consume different media. All our communication andentertainment needs can now be served through a unified broadbandhub. And this can be accessed through a personalised web interfacevia our PC, TV or mobile. This trend is set to accelerate in the next five years, making it possiblefor virtual homepage providers to track consumers' habits, preferencesand spending patterns. Such information is like gold dust for marketers,who will be able to tailor their advertising to the specific profiles of individual consumers. This white paper analyses developments in the world of behaviouraltargeting and automated ad-serving. We consider the emergence of a new age of interactive advertising and how search engines,consumers and advertisers all stand to benefit.
Digital Europe, tracking the growth of online marketing spend
, Digital Insight Report with IAB Europe, February 2006