e marketer webinar_cross-device_targeting_challenges_near-term_possibilities

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Cross-Device Targeting: The Challenges and Near-Term Possibilities

Lauren T. FisherAnalyst

January 15, 2015


Agenda:

The current state of cross-device targeting Obstacles hindering cross-device targeting The two main approaches to device identification The near-term future


The Current State of Cross-Device Targeting


What do we mean when we say, “cross-device targeting”?

A coordinated, strategic approach to identifying and messaging individuals across multiple digital screens


Cross-device ad targeting was a hot topic for advertisers in 2014


Cross-device will continue to gain momentum as US adults’ time and attention grow on and across multiple screens


The desktop remains the dominant screen for researching and buying products—even among smartphone owners—but other screens are gaining


In fact, advertisers should expect consumers to take a cross-device approach to fulfilling their purchasing goals


Today, a good portion of publishers say they offer cross-device advertising packages


But not all platforms and providers currently live up to the true definition of “cross-device”

“ There’s lack of clarity around [device identification] offerings. … You might see the word ‘multidevice’ used. Oftentimes, those people are allowing advertisers to buy on mobile and buy on desktop, but what they’re not doing is stitching that data together. If the data remains fragmented, it’s not really cross-device.”

—Ben Manning, director of product management at Quantcast

“ There’s lack of clarity around [device identification] offerings. … You might see the word ‘multidevice’ used. Oftentimes, those people are allowing advertisers to buy on mobile and buy on desktop, but what they’re not doing is stitching that data together. If the data remains fragmented, it’s not really cross-device.”

—Ben Manning, director of product management at Quantcast


The bottom line: cross-device targeting is still in its infancy


Obstacles Hindering Cross-Device Targeting


Taking an omniscreen approach isn’t easy; it requires multiple pieces to fit together


Marketers have long relied on cookies to track and target individuals across the digital web


But as the digital universe expands beyond just web activity, the cookie is no longer effective


Today, there is no universal tracking alternative, creating significant cross-device challenges


Addressing this challenge requires an entirely new toolset—and mindset

“Cross-device is the most important topic in digital advertising right now. It’s a big, fundamental shift to go from talking about devices and optimizing, targeting and attributing against devices to talking about people. It literally changes every aspect of your marketing efforts.”

—Chad Gallagher, global director of mobile for AOL

“Cross-device is the most important topic in digital advertising right now. It’s a big, fundamental shift to go from talking about devices and optimizing, targeting and attributing against devices to talking about people. It literally changes every aspect of your marketing efforts.”

—Chad Gallagher, global director of mobile for AOL


Key Takeaways:

To stay effective, companies must consider each screen True cross-device campaigns require coordination when

it comes to identifying and reaching consumers. But such coordination poses significant challenges today, given the lack of a universal method of identifying individuals across screens

Overcoming this obstacle will require the industry to take an identity-based—not device-based—approach to tracking and targeting individuals


An Identity-Based Approach: The Two Main Methods of

Device Identification


Companies today use one of two identifying methods:

Deterministic identification Probabilistic identification


Deterministic Identification

How it works: Relies on known-user information to recognize, with near-certain confidence, an individual on each of his or her internet-connected devices.

Examples of data used: Anonymized login data, CRM-level data, email address or customer ID.

Companies taking a deterministic approach: Facebook, Google, AOL, Amazon.com, The Weather Company, eBay, etc.


Probabilistic Identification

How it works: Uses a mix of publicly available ad-serving data to assess the statistical probability that a specific device belongs to a particular individual.

Examples of data used: IP address, browser version, operating system data, device type, browsing behavior, content consumption patterns, location-based data and time of day.


Both approaches come with advantages and trade-offs advertisers must consider:

Deterministic: – Near-perfect accuracy

– Relatively transparent in matching methodology

– ID method and data limited to specific publishing environment

– Might lack in scale

Probabilistic: – Varying degrees of accuracy

(50% to 90%+)

– Matching algorithms deemed proprietary

– General practice that can be applied to any property or campaign

– Greater scale


Today’s reality: Advertisers typically use a combination of the two

“ Even the deterministic IDs won’t be as complete as we’d want them to be. So you’ll always have to augment with some probabilistic approaches.

—Yosha Ulrich-Sturmat, vice president of product marketing at Neustar

“ Even the deterministic IDs won’t be as complete as we’d want them to be. So you’ll always have to augment with some probabilistic approaches.

—Yosha Ulrich-Sturmat, vice president of product marketing at Neustar


How much advertisers rely on one vs. the other will depend on a variety of factors:

Breadth of CRM or first-party data Campaign objectives Typical media-buying portfolio


Such methods solve for identity, but still don’t deliver a holistic, universal view of an individual

“ Identity-based advertising at scale is really the Holy Grail. To know that we are actually reaching and engaging the consumer that we intend to target with our advertising as opposed to sort of guessing … that is really the Holy Grail of marketing.”

—Natalie Bokenham, vice president and managing director of digital at UM

“ Identity-based advertising at scale is really the Holy Grail. To know that we are actually reaching and engaging the consumer that we intend to target with our advertising as opposed to sort of guessing … that is really the Holy Grail of marketing.”

—Natalie Bokenham, vice president and managing director of digital at UM


Key Takeaways:

Device identification is the first step on the path to coordinated cross-device targeting

Today, advertisers rely on both probabilistic and deterministic methods of pairing individuals’ identities to their devices

Though both solve for user identity, lack of a universal approach leaves advertisers with fragmented cross-device targeting efforts


The Near-Term Future


The near-term future for cross-device success will largely be shaped by:

Discussions surrounding a new, identity-based universal identifier to replace the cookie

Demand for greater standardization of identification approaches and methodologies

Data privacy discussions


Data is the key to coordinated cross-device targeting, and advertisers want to be the ones in charge of coordinating those efforts

“ What we see today is not the long-term solution. Marketers don't want … every single publisher having a proprietary way to do cross-device. They want the ability to activate and leverage their own data in a consistent way across any media channels they might use. ”

—Surag Patel, vice president of global product management and marketing at AdTruth

“ What we see today is not the long-term solution. Marketers don't want … every single publisher having a proprietary way to do cross-device. They want the ability to activate and leverage their own data in a consistent way across any media channels they might use. ”

—Surag Patel, vice president of global product management and marketing at AdTruth


But is a universal identifier on the horizon?

Advancers: – Advertiser demand

– Industry movement from the 4A’s Media Leadership Council and IAB

– Privacy concerns

Inhibitors: – Competition among ID

providers

– Disagreement over which methodology to use

– Privacy concerns


In the short term, expect to see greater standardization, especially to probabilistic:

Greater transparency around probabilistic data collection and usage to determine ID matches

Third-party validation of reported match rates Publisher push to incorporate deterministic methods

when possible


Also expect both consumer and company privacy concerns to influence data collection and usage


Key Takeaways:

Cross-device targeting is in high demand as consumers diversify their digital media consumption, but it is still a new, evolving tactic

Before advertisers can do anything cross-device, they first need to match devices back to a single individual

Deterministic and probabilistic approaches match identities to devices, but neither is foolproof nor 100% scalable

2015 will be an important year for advancements in cross-device targeting, but solutions are unlikely to be fully realized, thanks to outstanding questions surrounding the creation of a universal identifier and data privacy.

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environmentvariables+ IP address+ Country of origin+ Time zone+ Device type+ Operating system+ Browser type+ Screen resolution

site behaviorvariables+ Customer / Prospect+ New/return visitor+ Previous visit

patterns+ Previous Product

interests – top level+ Previous Product

interests – low level+ Searches+ Previous online

purchases+ Previous Campaign

exposure+ Previous Campaign

responses

offline variables+ CRM+ Call center+ Ticket sales+ 3rd-party data

temporal variables + Time of day+ Day of week+ Recency+ Frequency

referrer variables+ Referring domain+ Campaign ID+ Affiliate+ PPC+ Natural search+ Direct/bookmark+ Social graph/login

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Lauren T. Fisher

Cross-Device Targeting: The Challenges and Near-Term

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