By Christophe Camborde, CEO of Ezakus
Many have declared 2015 the year when predictive targeting will come to the fore as advertisers shift their focus more to cultivating new customer relationships as opposed to the previous prioritization of known customers via the successful tactic of retargeting. With retargeting, advertisers were able to hone in on known customer targets by tracking their actions on the Internet to ascertain purchase intent and in-market status.
I like to refer to this pivotal moment as the dawn of the era of crystal ball advertising because it is a potent metaphor to describe the unprecedented technological wherewithal at brands’ fingertips to more effectively identify, target, message and ultimately, sell to consumers. Others in our industry like to refer to this level of precise relationship-building as the newfound ability to do personal marketing.
Regardless of nomenclature, there are many factors that have culminated to set the stage for the emergence of this trend. First of all, at the core of what’s driving crystal ball advertising are the advances in consumer tracking combined with huge leaps in data processing speed and power. Moore’s Law — defined as the ability to collect, collate and process data in an exponentially faster manner — has taken hold, and pretargeting is getting increasingly more cost effective. The industry is at a point where 3 billion predictive scores using 50 variables can be generated in less than three milliseconds at levels of unprecedented accuracy. The speed and tonnage associated with the current industry software has been in large part the result of a generational changing-of-the-guard among technologists. Tech pros now in positions of power and driving innovation and development in all quarters are those who have made the transition from students to business people with a rebellious credo of breaking established rules of relational database technology. Like the mythic barbarians at the gate, this new generation dismissed previously accepted models and literally reinvented the orthodoxy of the manipulation of huge amounts of data.
This tremendous spike in processing power that they effected has stirred the attention of the world’s biggest brands, which in the past year or two have decided that scale and accuracy have finally coalesced at a level where programmatic media can now be an engine of profitable remuneration. Previously, the dominant multinational advertisers like General Motors, Procter & Gamble and Unilever were hesitant about jumping into programmatic wholeheartedly. They preferred putting up with a certain level of waste in their media buys in order to scale their campaigns at a comprehensive level. Now, the ability to more finely sculpt target audiences at scale, as illustrated by the actualization of Moore’s Law, is a game-changer. We as an industry can now manipulate huge volumes of data that the traditional media platforms like broadcast television could only dream about doing. It has also become relatively dirt cheap to put servers online and tap into clouds. In essence, it is now possible to just purchase the exact amount of computing needed. In the old days, it was more expensive, and computing was a fixed cost with excess calculation being an accepted part of doing business. Computing has now become a variable cost based only on as-needed purchasing.
The tangible impact that all this will have on marketer and/or agency budgets and strategies and/or tactics will be profound. Because manipulating demand-side platforms in programmatic media will get easier and easier, it will finally convince chief marketing officers to devote increasing budgets toward digital at the expense of TV and other traditional media. In the past, it was much more complicated buying digital than TV or radio. An advertiser can now execute peer-to-peer communication for the same price as broadcast and other traditional media.
At this rate, the impact on exchanged-based RTB (real time bidding) and other programmatic advertising will be profound, and the current processing speed coupled with increasingly accurate GPS measurements and other data will facilitate virtual tracking on both desktop and mobile.
Welcome to the era of crystal ball advertising!
Christophe Camborde launched Ezakus, a leading global predictive ad targeting technology company, in 2013 in Europe and then the U.S. in 2014. Prior to Ezakus, Camborde held significant posts in Europe as the CTO at Carrefour, as well as being the CEO and co-founder of Steek in 2005, a cloud storage company for Internet service providers including SFR, Orange, AT&T and Virgin U.K. He ultimately sold Steek in 2010 to F-Secure for $40 million.