The first campaigns, with a limited number of advertisers, will debut next month. Jason Brown, Canon's VP-e-media, told Digital Directions what it takes to implement such a cutting-edge online advertising technology.
Digital Directions: Canon Communications is a pioneer within b-to-b media in the use of behavioral targeting. Why?
Brown: We're willing to stick our necks out and be first because digital media is a big part of Canon's future, and we want to show our markets that we “get it.”
DD: How does behavioral targeting work in your markets?
Brown: We have always had sections of our sites dedicated to certain topic areas, and sponsors pay a premium to be associated with that content. That won't change. Behavioral targeting gives us a way to serve run-of-site ads much more efficiently, and probably 70% to 80% of the ads we run are run-of-site.
When a visitor takes an action on our website, such as reading an article or downloading a white paper, the person is tagged. The Boomerang software now recognizes the user as someone who is interested in topic X, and the person will be served ads related to topic X no matter where he or she goes on our site and whenever he or she comes back for a period of 30 days.
Historically, run-of-site ads were based on a general profile of our audience, and we knew that, if we served 100,000 ads, some percentage would reach the right person at the right time. With behavioral targeting, we know something about users' interests and we can serve relevant advertising with much greater efficiency.
The advertiser now has to buy fewer ads to reach the same target [audience], but the effective CPM is higher. We will charge a premium [for behavioral targeting], but the advertiser's total cost will be less. Meanwhile, Canon, which is often close to sold out on ad inventory, has tens of thousands of run-of-site ads to sell to someone else.
On top of that, the system can retag people on the fly as they switch from one topic to another, because they have multiple interests. Automatically, a different ad campaign will kick in.
DD: What is the cost to you to deploy BFP?
Brown: We pay a premium over and above our other DoubleClick agreements for Boomerang. It's a fixed CPM cost with a minimum buy-in price regardless of the number of impressions we service. We're not worried in the slightest about covering those costs.
DD: You did a test campaign on one site, EDN.com. You're not rolling out BFP to all advertisers and all sites at once, are you?
Brown: We're selectively partnering with some of our key clients right now. We're going to share every piece of data we find out about the users, both from an analytical standpoint using Omniture and from a behavioral standpoint using Boomerang.
Some of our titles are more sophisticated than others when it comes to the advertisers and the audience, so we will roll out the program first with our Design Engineering Group—Design News, EDN and Test & Measurement World. (These brands were acquired from Reed Business Information in February). Our second group will be our pharmaceutical group. Our medical design and manufacturing group will be third.
DD: Consumer groups have raised privacy concerns about behavioral advertising and government regulation may be coming. Does this worry you?
Brown: I am worried about what people in Washington may be trying to do; but Google, which owns DoubleClick, has an army of lawyers and lobbyists. They will probably support some privacy safeguards, but they're going to fight any regulation that would harm the online advertising business.