For many companies, traditional advertising can feel like an arbitrary, hit-or-

miss operation. Carefully crafted messages sometimes fall short without an

apparent reason. Potential customers don’t connect with the product in a way
that encourages them to engage and purchase. These less desirable results
often stem from marketers creating ads that fail to address the viewer’s
particular interests and desires. They can also result from reaching the wrong
audiences altogether.
In the age of data and advanced tracking technologies, random marketing
should be the way of the past — especially on the web. Not only have prior
methods lacked effectiveness, but they have led to the tremendous waste of
valuable resources over the years. If you are an online advertiser, you can use
the innovations of data management to target audiences that offer higher
conversion rates.

What Is Behavioral Targeting?

Behavioral targeting is a marketing method that uses web user information to
strengthen advertising campaigns. The technique involves gathering data
from a variety of sources about the potential customer’s online browsing and
shopping behaviors.
This information helps create ads that are relevant to that specific user’s
habits and interests, which the publisher can then display in that visitor’s web
browser.
The primary purpose of this technique is to deliver advertising messages to
the behavioral target markets that have shown the most interest in them. The
process involves compiling web searches, purchase histories, frequently
visited websites and other information to create a full user profile, revealing
what your audience wants, avoids and purchases. Using these data points,
companies can formulate ads that align with the individual consumer’s
trackable preferences and needs, without conveying messages the viewer
would find unappealing or irrelevant.

What Are the Benefits of

Behavioral Marketing?
Behavioral targeting may be data-centered, but its benefits are much more
tangible than any abstract number systems. Focusing campaigns on
behavioral target markets not only benefits the advertiser, but the consumers
themselves reap numerous rewards, as well.

Here are a few of the advantages behavioral advertising offers for the
advertiser:
 Increase in User Engagement: Behavioral tracking grants publishers access to
consumers who display habits of engaging with specific marketing material.
With one-click ads, consumers can be redirected to online storefronts and gain
intel on the company in a matter of seconds. However, without advertisements
that create a sense of interest and trust, viewers are less willing to engage
initially. Once the user accesses the company’s website, the brand can offer
content from other areas of the site, increasing clicks and activity for targeted
ads down the line.
  Higher Number of Ad Click-Throughs: A personalized ad that captures the
viewer’s likes and needs is a much more useful tool in helping consumers move
down the purchasing pipeline than a generic banner ad without relevant appeal.
Upon initial exposure to a highly-desired product, an interested viewer is much
more likely to seek more information and continue to check out than they are
with brands that fail to align with their previous browsing and purchasing
behaviors.
 Improved Conversion Rates: Advertisements that reach a behavioral target
market have higher appeal to those who view them, increasing the chances that
users will proceed to request more information or complete a purchase. With
the techniques of behavioral targeting, companies can see an increase in sales
and repeat customers, enjoying higher profits overall.
In turn, the viewer also benefits from behavioral targeting in three ways:
 A More Exciting Ad Experience: Online users don’t always enjoy the idea of
giving up personal information to advertisers. However, they often find it more
frustrating when the ads they encounter are irrelevant and unengaging. That’s
why a recent study found that 71 percent of consumers prefer more
personalized website ads, even if they need to expose their click and purchase
habits in exchange. When the ads are more personalized, viewers find their
browsing experience more enjoyable overall, leading to higher user
satisfaction.
 Higher Efficiency in the Online Shopping Process: When ads for products
that interest them are prominent in their web browser, consumers can click
through to access online storefronts quickly, often being automatically
redirected to the page about the particular product highlighted in the ad. From
there, adding the item to their shopping cart and proceeding to checkout only
involves a few easy steps, which online shoppers often appreciate.
 Reminders and Alerts for New Products: By continually seeing ads for
products they find attractive, viewers can keep up with new releases and stay
informed about brands they enjoy. Additionally, if a user was distracted from
completing an online purchase, a personalized ad about the company may
remind and motivate them to go back and finalize the transaction.
As consumers engage with personalized ads, they not only have a more
favorable shopping experience where they get access to products and brands
they enjoy, but the advertiser also reaps the rewards of better sales and
website activity, increasing the company’s overall popularity and profit.

How Behavioral Targeting

Advertising Works (in 4 Steps)
So, how does behavioral targeting work to create these personalized and
profitable advertising experiences? It’s all about tracking user behaviors
online and collecting pieces of data from these behaviors called “cookies.”
The process often involves four steps.

1. Collect Cookies
When users visit new websites or create an account, for example, a cookie is
placed on their computer, stored either temporarily on a local memory drive
from which it is deleted after the browser is closed or more permanently on
the device’s hard drive.

2. Create a User Profile

As cookies are collected and stored over time through new page visits, ad
clicks, time spent on particular content and other data, behavioral patterns can
form related to shopping and search habits.
3. Designate Consumer Groups
Using the patterns and profiles created, companies can separate users into
different target market groups. Once these distinctions are made, websites
that focus on behavioral targeting will be aware of the purchasing trends,
interests, likes and dislikes of the members of these individual audience
segments.

4. Share Relevant Information With

Viewers
At this point, instead of receiving random ads, consumers will only view
custom content and personalized ad material that draws from past behaviors
when they reconnect to the network or website.
For this process to be successful, it requires a powerful data gathering tool
and a successful means of implementing it. To do so, the best behavioral
advertisers use a data management platform, like the one we offer at Lotame,
that provides reliable data-collection tools and cutting-edge analytical
resources.

How Successful Behavioral

Targeting Uses Your Data
Management Platform
Nearly every company has data on their customers. Some collect it
proactively, while others end up gathering information unintentionally. Either
way, data is only useful if you know the right way to use it to attain any
desired results. For example, advertisers want to make sure they implement
the information correctly, so they can avoid creating ineffective ad content.
One of the most helpful tools for content creators is a data management
platform (DMP), which can help harvest data about their audience, store it,
analyze it and use the results for successful behavioral advertising.
Learn more about DMPs in this short video:
What makes a DMP beneficial for companies looking to use behavioral
targeting? The right DMP will know what kind of data a company needs from
users to achieve a specific outcome, drawing from sources of both online and
offline data to drive optimal advertising potential.

Which Categories of User

Information Do Data Management
Platforms Gather?
Computer browsers are one of the most prominent sources of behavior
information for targeted ads. However, DMPs tend to go a step further than
focusing only on web data. Consumers are people with a variety of interests
and preferences — in both professional and leisure realms of life — some of
which can’t be determined by only looking at online habits. That’s why the
best DMPs take a look at offline information and other data a consumer’s
device gathers on a regular basis.
A few other categories DMPs can access to find information on a consumer’s
regular habits and histories include:
 Mobile Device Data: Cookies stored on smartphones, tablets and laptops are
some of the most valuable for tracking a potential customer’s behavior.
Through day-to-day behaviors, users provide data about their activities,
communications, search and navigation history, mobile purchases, social media
clicks and check-ins, and other information that can have a critical influence on
the best way to target them. Considering how often people use their devices —
especially their cell phones — retrieving this relevant data could be the key to
unlocking higher response rates and engaging a new audience.

 Geographic Location: Mobile devices aren’t the only indicators of a

consumer’s geographical movements. When a computer accesses an online
network, DMPs can pull the computer’s IP address — or numerical
identification code — which communicates where the PC is in the world.
Advertisers can use an IP address to track where a user visits their website,
indicating where that user may live, work or spend much of their time, as well
as revealing travel habits depending on different log-in locations and the time
spent between visits.
 Subscription or Registration Entries: Attaining full access to a website or
product often requires users to create an account, purchase a subscription plan
or fill out registration forms. Strategic DMPs can pull the information the user
provides in these instances, which can include demographics, ZIP codes,
contact information and fields relating to interests or activities. These pieces of
data along with others enable DMPs to estimate purchase needs, times and
locations, so it can present appealing and necessary messages to the consumer
in ideal future circumstances.
  Demographic Information Through Diverse Networks: DMPs offer the
advantage of using first-, second- and third-party data to collect wide ranges of
demographic, behavioral and contextual audience information that make
campaigns more layered and effective overall. The cookies and other advanced
technologies DMPs use to compile this data won’t pull specific personal
information like the addresses and phone numbers of consumers, but software-
owning companies can learn the general ages, genders, locations and other
demographic data points to create ads that communicate more personally with
typical site visitors.

Gathering these data points to create content that represents the consumer and
highlights their interests can be a challenge. Fortunately, with the help of a
quality data management platform, the process becomes much more
achievable.
While the data categories above define some of the types of information
DMPs can collect, the specific behaviors that reveal this information aren’t
necessarily evident from looking at the data types themselves. To create
valuable material, DMPs must monitor a range of web activities and record
the relevant information for advertisers to use to their advantage.
What Types of Consumer
Behaviors Do Behavioral
Targeting Companies and DMPs
Track?
Companies that specialize in behavioral marketing by implementing the full
potential of DMPs must pay constant attention to their audiences. As users
perform specific actions online, such as completing a web search, DMPs
record that information to continue the conversation with the consumer
through ads.
Behavioral targeting is why, for example, someone may browse through
different products on an online storefront without finalizing a purchase. Then,
in the following days or weeks, this consumer will begin seeing ads for that
particular website all over their feeds as they navigate the web, a reminder of
their expressed interest.
Which actions set these kinds of processes in motion? A few of the behaviors
DMPs focus on include:
 Frequently Visited Pages: Within a specified network, DMPs begin their
monitoring by checking the web pages a user accesses, whether they visited
once, multiple times or on a regular basis. Looking at these pages may reveal
patterns in behavior or interest trends, as the DMP gauges why the user visited
the site in the first place. For example, if the user bought something on the
page, the data may predict they will make another purchase down the line,
which influences the advertisements they will see moving forward.
 Webpage Viewing Times: The amount of time a consumer spends on a
particular site is a crucial element of measuring their interest level. While they
may initially click on a link, they might only scan the page briefly before
exiting, finding the information irrelevant to them. Other times, the viewer may
have a higher interest and read the entire content. If DMPs only gathered URLs
without accounting for the amount of time a person spent on the pages, DMP
owners would be subject to misinformation that could decrease their
advertising’s effectiveness.
 Clicked Ads and Links: One of the best ways to determine what sorts of
language and advertising grab a particular user’s attention is by monitoring the
links they click on. Clicking habits reveal a user’s objectives when navigating
the Internet, the kinds of products they are looking for and the types of
messages draw them in. Some users may prefer to casually surf and remain
entertained, while others strategically click through pages to meet their needs.
Identifying these differences in behavior helps DMP owners create more
effective campaigns.
 Personal Web Searches: Similarly, web searches reveal which online users
are on a mission to fulfill a particular need and what kind of assistance they
may be searching for. If a customer opens your website and searches for a
specific item, in the future, your DMP can use that recorded data to provide
related targeted ads as soon as that customer reaccesses your website.
Additionally, documented search terms can be stacked with other data to create
a more thorough profile of this consumer’s behaviors and web activity goals.
 Webpage Element Interactions: Web user goals vary significantly from one
consumer to another. One way to help narrow down what these users are
looking for is by identifying which elements of a particular website they tend to
interact with. From navigational sidebars, icons and menus to engaging
graphics, blog posts and video content, consumers focus on the portion of web
material that speaks most accurately to their browsing objectives. DMPs draw
intuitive conclusions from this data to deliver messages to those audiences in
the most appealing positions and formats.
 Transaction Progress: At times, customers may fill their virtual shopping
carts only to abandon their purchasing efforts at checkout. While this may seem
like a negative result for retailers, it actually indicates a higher willingness and
readiness to follow through with purchases in the future compared to users who
only view items without putting them in their carts. Marketers can direct ads to
the consumers who are in the process of completing transactions, highlighting
the products they expressed interest in buying.
 Purchase Histories: On the other side of the checkout line, DMPs track the
history of purchases customers make on web pages to help predict what sort of
products they may be open to buying next. The follow-through of purchases is
a huge indicator that the user is invested in the brand and will likely order
again. Relevant, personalized ads can keep this interest at the forefront of the
customer’s mind until a product or need arises that compels them to take action.
 Time Gaps Between Visits: The amount of time viewers spend away from a
webpage can illuminate critical points for advertisers to use in their marketing
strategies. Short absences may indicate a user with a great need for the product.
If a user only accesses a website or network on an occasional basis, the
company will know the content is valuable enough to the consumer for them to
 visit from time to time, but also that the website isn’t an integral part of their
daily life.

The highly advanced technologies that enable data management and

behavior-tracking changed the way companies advertise online unlike any
other innovation. Now, consumers can enjoy a richer browsing experience
full of ads that speak directly to their interests, while online retailers and
service providers reap the benefits of a more efficient, sophisticated means of
understanding their audiences.
If you find that your company continues to waste time and ad space on
ineffective campaigns, it may be time for you to leap into the data-centered
world of behavioral targeting — and we know just the place for you to start.

Choose Lotame to Manage the

Data for Your Behavioral
Targeting Ads
Increasing your conversion rates has never been easier thanks to the
innovation of behavioral targeting. When you publish content to reach users
on a personalized level after they have demonstrated specific interest, you
can improve the cost-effectiveness of your advertising, saving both energy
and resources.
Lotame is here to help you navigate the unfamiliar territories of data-centered
marketing approaches. If you need additional information about the intricate
details of behavioral targeting strategies, look no further! As an independent
leader in the data management industry, we are happy to answer questions
and help you decide whether our DMP or other quality solutions can benefit
your company.