Behavioral marketing is what is behind cookies and adware. It’s the idea that by knowing what an audience is doing, you can tailor ads to them.
Of course, this means that advertisers have to know what you’re doing online… and that is where you get a lot of the privacy arguments. As I’ve discussed before, cookies provide advertisers the ability to infer demographics and tastes and hence, display advertising that attempts to match the behavioral characteristics of the viewer (for example, an advertisers can infer that someone who goes to a lot of NASCAR sites might be interested in Ford trucks or Budweiser beer). However, it’s imperfect because a) many people hate cookies and b) there are privacy concerns and c) it is a actually a fairly sloppy way to gauge demographics.
There was an article earlier this week in iMediaConnection on the subject of behavioral advertising, which attempts to dispel the myths of behavioral advertising. It’s focused on teaching advertisers how this all works:
Behavioral Targeting (BT) is a load of hype. Like so many internet businesses, BT has been horribly over-promised and chronically under-delivered…On the other hand, without question BT is the future of online media.
Then there’s this chart:
Would you be more inclined to click on a banner ad if the product/service was more relevant to your area of interests or needs? Freq Pct % Absolutely yes 132 12% Most likely yes 425 40% Unsure 210 20% Most likely no 167 16% Absolutely no 136 13% Total 1070 100% Source: “Understanding America’s Perception of Internet Advertising and Consumer Privacy,” conducted by Revenue Science, Chapell & Associates, and the Ponemon Institute (2004).
What would the response to the same question have been if it had been worded:
Would you be more inclined to click on a banner ad if the product/service was more relevant to your area of interests or needs, and in exchange, you had a piece of software on your system that tried to determine what those interests or needs were?
Would you be more inclined to click on a banner ad if the product/service was more relevant to your area of interests or needs, and that advertiser had paid for the privilege of extending you that offer?