BY aarrieta

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Behavioral Marketing techniques are a common, sophisticated practice today, with a growing market as the one who work in this industry know, which objective is to improve and achieve advertising relevance.

Being a standardized practice takes the industry to a development peak where it is not only tested by the Innovators (2.5% of the market) or the Early Adopters (13.5%) but it starts being a product adopted by the Early Majority (34%),  to state it in the words of Geoffrey  Moore, author not of the  Moore Law but of the Technology Adoption Life Cycle and of Crossing the Chasm.

The drawback of the process is that product innovation is frozen, in order to sell a stable solution, tested by the innovators and the Early Adopters. While the products and the solutions that are developed in the market begin to copy and to repeat themselves, or as Kjell A. Nordstrom in Karaoke Capitalism would define it, are companies that sing songs of others instead of creating new ones.

Following the line of thought, within the search for advertising relevance that we are living through, beyond the Behavioral Marketing Karaoke (which by the way I love) there are few things that sound like brand new.

This makes me acknowledge myself as an innovator, that according to Moore, an innovator looses interest on what the Early Majority hasn’t tested yet or is starting to test and searches for the innovation on online advertising.

This new song or innovation is not something that a sole company is doing but it is starting to look as a trend:

1-      Phorm, a company that in the past developed 121 Media (adware company) currently, has offices in London, New York and Moscow

This company adds to the “traditional” data of Behavioral targeting, to surfing sites cluster and networks profiles, logs of traffic provided by the ISPa, obtaining specific information of the audience that can improve the information that for instance, Google may have (higher data concentrator of the industry).

With the 3 ISPs current partners of Phorm, there is access to 70% of broad band clients in the UK and this implies a reach and a behavioural knowledge of the user that nobody can have, the ISPs are the owners of the pipes and the surfing data that adds a great amount of efficiency to any network.

The past of adware, I believe adds more than what it can deduct because that industry learned very well where are the privacy limits and how to obtain a self regulation before the authorities could intervene (the main restrain for any sector to develop).

Lastly, the fact that being in the UK ensures testing the technology in a very competitive and controlled market at the same time, especially in the privacy, publishers and advertisers areas.

2- The second company on this incipient trend is http://nebuad.com/, in this case a US company, who propose a new approach that turns them into first consumer-centric behavioral targeting network, where beside the marketing euphemisms, end up doing something similar to Phorm, where through agreements with ISPs   ( lease revenue sharing ) and the traditional of the newtwork  (publishers and advertisers) add value with a technology that combines all this anonymous information trying to achieve the highest advertising relevance.

Here some Nebuad directors, have been directors of Claria, a company formerly known as gator, who developed one of the most efficient system of advertising relevance that I’ve known, based on adware as well. Another coincidence is that both companies are in Redwood City. ☺ They also have offices in London, what allows them to take a position on that market and validate their model over there.

3- the third case is Front Porch, Inc a US (from Sonoma, CA) private company, that uses ISP information. Another model that this company is testing is offering free Internet (sponsored by advertising) on places such as the airport in Denver and they additionally have collected information from millions in Asia and some hundred thousands from the USA.

Conclusion:

 What these companies are offering is a new model that could add a twist to the contextual focus of Google-Yahoo and to the still limited standardized data of Behavioral Marketing.

If it can be done anonymously, as they claim, without generating privacy issues, and under an open protocol of rev share, it could turn into the next big thing.

Related articles:

1. Phorm y la lucha continua por la privacidad | Denken Über
2. Louise Story (March 20, 2008). “A Company Promises the Deepest Data Mining Yet“, New York Times.
3. Internet Providers Quietly Test Expanded Tracking of Web Use to Target Advertising“, The Washington Post “American ISPs already sharing data with outside ad firms“
4. “The Phorm “Webwise” System” (PDF). Cambridge University.
5. “Phorm Service Privacy Policy”
6. “BT targets 10,000 data pimping guinea pigs“, The Register.
7. “Phorm Frequently Asked Questions“.
8. “Phorm – Webwise and Open Internet Exchange“.
9. “ISP data deal with former ‘spyware’ boss triggers privacy fears“, The Register.
10. “Phorm Factor“. F-Secure
11. “F-Secure Spyware Information Pages: PeopleOnPage“.
12. “Phorm launches data pimping fight back“, The Register
13. “Spyware, Rootkit Maker Stops Distribution”. Eweek. Retrieved on 2008–04-17.
14. “FCC scrutinizes behaviorial targeting of Internet ads“, Pittsburgh Tribune.
15. “Phorm seeks $65m for overseas expansion“, The Financial Times.
16. “Phorm mystified by fall in share price; we interview its chief“, Guardian Unlimited
17. “Ad system ‘will protect privacy’“, BBC News.
18. “Your questions please for Kent Ertegrul, CEO of Phorm“, Guardian Newspaper
19. “Webwise Chat Transcript” (2008–03-11).
20. “BT confesses lies over secret Phorm experiments“, The Register
21. “Management & Investors”.
22. “American ISPs already sharing data with outside ad firms“, The Register
23. “Watching What You See on the Web”, The Wall Street Journal
24. “NebuAd Observes ‘Useful, but Innocuous’ Web Browsing“, The New York Times (2008/04/07).
25. “NebuAd / Privacy”.
26. “Congressmen Ask Charter to Freeze Web Profiling Plan“. Threat Level from Wired.com.
27. “Can Charter Broadband Customers Really Opt-Out of Spying? Maybe Not“. Wired.
28. “Robert Dykes (CEO) presenting NebuAd at OnMediaNYC-01/28/2008“.
29. “Data pimping catches ISP on the hop“, The Register
30. “Infighting At ISPs Over Using NebuAD“. Broadband Reports.
31. “Questions for Bob Dykes, NebuAd CEO“. clickz
32. “Charter Cable to Spy on its Broadband Users to Serve Targeted Ads via NebuAd“.
33. “ISPs Collect User Data for Behavioral Ad Targeting“. ClickZ
34. “CDT Urges Stronger Guidelines for Behavioral Advertising”
35. “Fair Warning for Copyright Holders“. Multichannel News.
36. “Every Click You Make“. Washington Post. “Front Porch collects detailed Web-use data from more than 100,000 U.S. customers through their service providers, [Front Porch CTO Derek] Maxson said.”
37. “Front Porch Says Competitors Over Promise Behavioral Ad Revenue“.
38. “ISPs laud their data pimping services but refuse to use them“. “Though Front Porch tracks your IP address as well as your search and browsing activity, [Front Porch CEO Zach] Britton points out that it does not collect the contents of the page you visit. ‘In order to adhere to wiretapping laws, we only listen to one-side of the conversation,’ he says.”
39. “American ISPs already sharing data with outside ad firms“. TheRegister.
40. “Denver International Airport Offers FreeFi Networks’ Free Wi-Fi Service to Passengers”. PR Newswire “A Seat on the Front Porch“. Wi-Fi Planet.