Start-up Mines E-Commerce Data for Online Advertising

BlueKai Favors Purchasing Behavior Over Browsing Behavior

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NEW YORK ( -- Almost no one reading a story about Ford Motor Co. these days is actually interested in buying -- or would consider buying -- a Mustang.

That's a problem for online publishers and ad networks that use behavioral targeting techniques to target ads at likely consumers based on where they go or what they do on the web. Online behavior these days may have nothing to do with intent to buy anything.

Scanning the shopping sites
There are sources of data tracking true shopping behavior, but they're mostly locked inside e-commerce and comparison sites such as Amazon, BestBuy, Expedia or AutoByTel that may or may not have an advertising business.

That's where a Bellevue, Wash., start-up called BlueKai comes in. The company, which launched in September, has been collecting data from e-commerce sites in order to target ads based on what people are shopping for, rather than what they're reading.

"The real interesting data is in commerce and shopping sites," said BlueKai CEO Omar Takawol. "Those sites know more than Google about what you are going to do.

The company, set up as an anonymous data exchange, raised $10.5 million late last year from Redpoint Ventures and Battery Ventures. Last week it added its 100 millionth unique online shopper, including 18 million in-market car buyers.

Flat fee
When targeting ads at particular behaviors, publishers typically have only their own data from which to work, while networks have data from sites on which they place advertising. But those campaigns can't work well if the data behind them don't represent the intentions of a consumer.

For years, ad networks have been attempting to license data from e-commerce sites, usually offering a share of the revenue generated from campaigns in which it is used. BlueKai's model is to charge a flat fee for access to data, 70% of which is passed on to the e-commerce sites themselves.

Mr. Tawakol won't say which sites participate, but he's clear about sites that won't qualify, including blogs, magazine websites, community, or news sites. "The data is very good because consumers are going [to certain sites] not to read, but precisely to buy or do price comparison shopping," he said.

The company is set up as an independent broker for consumer information, much like an online version of Axciom or Experian.

To this, BlueKai adds another wrinkle: Consumers can visit the site to see exactly what their profile looks like online and edit it, or just opt out completely. They can also have a portion of the proceeds donated to a charity when a marketer pays to access their BlueKai data.

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