Retargeting Is Flawed; the Future Is Pretargeting
There is no time in my life I am less likely to buy some white pants, a toaster or a ﬂight to Los Angeles than after I've just bought these items, yet that's precisely the time I see ads for these products or services.
These ghostly images stalk our internet journeys like shadows. While ineffective, these ads come to us by some of the most advanced technology there is. By some measures, they are the most appropriate ads to serve us; they can be the most noticeable, but they are also the most pointless. It's like an inaccurate watch -- knowing the engineering inside is impeccable doesn't help if it can't reliably tell the time.
Retargeting is based on the past. The clumsiness of retargeting is well-documented and we're assured that teams of scientists are working away to improve the algorithms -- these are the new media buyers, planners and creatives of the performance marketing age.
I have no doubt that retargeting will get better. When more and more behavioral data is overlaid with checkout data, credit card data and recommendation engines, we will soon see a new era of personalized advertising. We'll be shown ads for big-ticket items at precisely the right time, after we've been thinking about them for a predetermined period. We'll be shown ads for items that work perfectly with our new white trousers. Technology is moving so fast that soon both the ad placement and the advertisement itself will become automated.
We'll see fully rendered completely personalized video ads based on real-time pricing, real-time availability, the weather and thousands of other data points. The art director and copywriter team of the future is the algorithm and processor.
Nonetheless, the main problem with retargeting remains that it's based on the past. It's about reaching people who have bought items, who've accepted they need something, and who have started to act.
From the past to the present
Search focuses on the present. The value of search is predicated on its future vision; search is the only opportunity in advertising to address people at their moment of need, before they take any other action to quench it.
We search at the start of the purchase funnel. Search will for this reason alone forever retain incredible value in the advertising mix -- the single best way to convert known interests into action. But search requires us to know that we need something. It takes effort; sometimes we need help and we don't know it or want it. Predictive ads are about the future. Search will soon be trumped by something mind-blowing -- what about converting needs we don't yet know we have?
Predictive advertising: From the present to the future
The digital ecosystem is an untapped mine of data for advertising, and our changing behaviors are making it even more so. The more we like posts on Facebook, accept location services, connect our address books, use our digital calendars and the more we share this information across devices, the more accurate the pictures of our lives become. When companies with incredible processing power overlay what we do, where we go and how long it takes -- both as individuals and collectively -- a rich new picture of what we do emerges.
The world of predictive computing is upon us. We see a few early entrants -- we have Google Now predicting our journey to work and telling us to set off early if trafﬁc blocks our normal route. Microsoft Cortana may see our upcoming ﬂight to Sydney and offer relevant information like exchange rates and weather forecasts. And it's this value that changes everything.
The current privacy debate is focused on privacy being lost -- the debate needs to move to privacy being exchanged. Facebook's recent decision to announce its new privacy terms but also to explain how consumer information would be used to make better advertising seems rather sensible. It seems like a value exchange. Aided by a degree of opting in, we will likely soon see a world of advertising experiences on another level -- the world of ads for products at the right time, the right place, with the right message all based on predictions about your needs at that time. It will be the coffee shop suggested when you have time and it's about to rain; the Taxi2 ridesharing app telling you someone else wants to go the same way as it thinks you do; the car garage that will repair the problem only your car knows it has; the train times when snow blocks your route to work; the meal special offer when your friends are close and your calendar is free.
Future advertising will soon become a valuable offering of useful information at the right time and at the right place and in the right way. This contextually precise assistance, aided by a landscape of new connected wearable devices to provide better inputs and ways to convey information continuously, changes everything.
Predictive advertising should be an incredible emerging world for brands to exploit. The technology is here, but what's stopping it is the huge cultural shift that needs to happen that will allow more comfort with sharing information. Predictive advertising comes from trust, and when we accept that privacy is a lost battle and decide to embrace this, then we can get something in return.