Notes from Brian Morrissey: Data and its Discontents

brian-morrisseyAt Digiday we have this thing we call Buzzword Bingo at events. The idea is that people get a prize by plotting out various buzzwords. I like to have a side bet nowadays of what will get checked off first: “native advertising” or “Big Data.” I don’t have the numbers totally crunched but I’m pretty sure Big Data is in the lead.

This is normal. Big changes – think the cloud – frequently become marketing terms that quickly lose all semblance of meaning. It’s easy to poke fun at them, or even dismiss their importance entirely. That would be a mistake with Big Data. It means something – but that something has been lost by all the marketing that’s overwhelmed it.

I say this because I feel that our ability to collect so much data, crunch it, etc. has sometimes caused us to lose sight of the ultimate goal. Take publishing. In my role as editor, data is incredibly important. I look at data from Google Analytics, Chartbeat and sharing services in order to determine answers to a few simple questions: 1) Is what we’re doing working? 2) What should we do? Now this data is an input. It’s just that. Our audience development manager, who is very young, mentioned to me that Upworthy uses about 200 versions of a headline to see which one will work. That’s OK to me, but it’s also a bit of a shortcut. In the end, I can’t make editorial decisions based purely on the numbers. All our stories would be Top 15 Worst Brand Screwups in Social Media. Our goals of building a strong brand and a loyal audience that respects us for honest coverage of important issues would be compromised. There’s not an algorithm for that. It’s a sensibility.

Data is an input that will help. When it comes to digital media, data is about two things from my point of view.

Data allows companies to better serve their customers. This isn’t new – companies have always relied on data. It’s just that now, there’s a lot more of it. The really interesting part about data is when companies improve their services for customers. This is the promise of Big Data to me. I go back to Amazon’s collaborative filtering technology. At the risk of sounding like the old guy my millennial colleagues like to paint me to be, this was a game changer. Suddenly I was able to find related products of interest to me. I knew full well Amazon was tracking my purchases and browsing to do this. And I loved it! Same with Netflix – I love it tracking me. I want it to track me. I need it to track me. I want it to figure out for me what to watch.

Data allows digital media to be more efficient and useful. In this world of data, we should see fewer, better ads. That’s the promise. We operate online leaving a digital bread crumb trail. Nothing is free in life. The implicit tradeoff is that we’ll allow publishers and advertisers to responsibly use this data in order to improve the ads we see to pay for the content and services we use. This is noble, and important – and I’m not saying that because eXelate bought me a lovely lunch. You can feel the “but” coming here, right?

The simple truth is the promise of Big Data in advertising is confusing. There’s an idea on the data side of this business that marketers must speak the language of technologists and not vice versa. We see this all the time in how the many technology companies try to explain what they do. Khurrum (Malik, CMO eXelate) and I were talking the other day, and he brought up the concept of the tyranny of knowledge. It fits perfectly for one of the biggest challenges of this industry: how to simply explain what it does. Too often there’s an assumption on the part of the data-crunching techies that everyone understands this – or should. It leads to people on the marketing side not asking simple questions for fear of looking foolish. But these are the questions that need to be asked: How does what you do help me serve my customers better? How can it help make advertising better and more efficient?

That brings me to where I see this idea of Big Data going. And it’s away. It’s like how social media is fading into the ether. “Social” is part of everything. I’d coopt something Charlene Li said years ago about social: It’s like air. So too is data. It’s everywhere. It’s not a feature, it’s the environment. Once we get over this idea that data is something new and exotic, to be mined maniacally, collected and protected zealously, we can get back to what I mentioned at the outset: How can we use these raw data inputs to help people? How can data be used to tell better stories? How can data improve services and even create entirely new ones?

To answer these questions, it is necessary to move a step further from Big Data – it’s time for quality over quantity.

Brian Morrissey is the Editor in Chief of Digiday. Follow him on Twitter @bmorrissey.

What’s In Store For Marketers in 2013? The Data Knows!

As seen in: MediaPost Publications

exelate smart dataIt’s that time of year again.

Digital prognosticators beg their data scientists to run predictive algorithms to determine the likelihood of the coming year’s events. With almost zero accountability and no proclivity toward self-serving predictions (wink), I offer my look at the headlines from the year ahead.

1.  Programmatic buying eclipses the 50% mark. Audience buying, BT and RTB have already gone mainstream for marketers. You don’t need a Magic 8 Ball to see that 2013 will be the year that the machines take over for good. The last of the premium publisher holdouts (Turner, ESPN, etc.) will join the fray by creating their own “private markets” and will become exchanges by another name. Fewer lunches at The Breslin, more high-speed media-trading servers!

2. Mobile online video consumption tops PC viewing (and approaches TV). Tablets, smartphones and E-readers are rapidly becoming the go-to devices for streaming video. Faster wiFi, cheaper 4G services and better video-compression solutions are helping drive the “video anywhere” explosion — eliminating the “lean in” experience of a laptop. A recent Nielsen study saw mobile video consumption increase by 25.9% year-over-year, while TV viewing dropped 1.8%, albeit from different bases (TV still has a 1.5x lead). This device gap will erode over the year and we will enter 2014 with a new video champion across the board.

3. Marketers get serious about leveraging their data. First-party data has never had more potential in the digital marketing world. With CRM on board, advanced retargeting and first-party data modeling will all gain steam as marketers look to differentiate their consumer outreach by employing their vast amount of owned data. Offline data companies, which have performed “list modeling” for direct marketers for decades, will scramble to keep up with the rapid pace of data-driven digital marketing advancements. M&A will be their answer.

4. A major magazine publisher goes digital only — with a twist. After years of declining revenue and readership, a top consumer publisher group stops the presses and goes tablet only. Google underwrites the whole endeavor by distributing tablets to current subscribers (filled with Google ads, of course) and finally gets knee-deep in the content business. Shouts of “revolutionary” and “traitor” are bandied about in equal measure by the publisher’s rivals as they secretly wish they were extended the lifeline. Fashion editors are suddenly seen in great numbers descending on SFO and looking for black sedans to take them to Mountain View.

5. The advertising battle lines are redrawn. The digital marketing war among Google-MSN-Yahoo-AOL will seem quaint as “rogue” ad warriors create chaos with new offerings. That little online bookstore, Amazon, along with a rapidly evolving Facebook, will shake up the balance of ad power in a serious way. Ownership of the consumers’ shopping and social life will trump any connection that content can create, while “traditional” digital media scrambles to catch up.

6. The industry determines “Big Data” isn’t Big Enough. After much confusion over how much data is actually “Big,” and who really has enough to be part of the club, a consortium of leading data companies agree that the term has been overused and must be revised. The group agrees the buzzword of 2013 will be “Ginormous Data” after turning down “F’ing Huge,” “Much Bigger than A Breadbox” and “My Brain Hurts” Data. IBM claims that it trademarked “Ginormous Data” in 1968 after a carpool of scientists missed the turn for Armonk and ended up in Woodstock. Lawsuits are settled amicably.

2013 will be a VC-fueled, M&A-frenzied, non-Facebook-IPO kind of year, where at least two new LumaScapes will be introduced (digital fast food delivery companies and the cosmetic surgery app ecosystem are rumored to be on tap) and numerous new conferences will be launched (The Digital Ad Targeting Tech Behavioral Mobile Social Summit in Malibu looks promising). I look forward to a fun-filled year working with you all!

Much Ado About Nothing: Why the Cookie Craze?

In the Wired article “Stop the Do Not Track Madness,” Lauren Weinstein takes issue with the controversy around “Do Not Track” functionality for browsers to block cookies.  As he notes, “emotion and political gamesmanship have often replaced common sense and logic to no good end.”  As someone who has worked with internet technologies since the development of ARPANET  in the 70s, I respect his perspective on this issue.

We see groups making an emotional appeal to the press/consumers that cookies are by default a bad thing for consumers and need to be stopped. Politicians seem to be using this argument in order to score points, but they don’t truly understand how the technologies involved work or the impact their proposals would have. There have been efforts to build privacy controls directly into the browser before the Platform for Privacy Preferences Project (P3P), but ultimately those standards were not widely adopted and the impact was minimal (I believe only Internet Explorer supports P3P).  To Mr. Weinstein’s point, preventing data collection and reducing the value of web ads to advertisers is going to hurt websites that are offering content and services at no cost to the visitor.

Industry self-regulation efforts to date have worked to provide transparency and multiple levels of control to consumers when it comes to interest data being collected online.

  • The first level of control that the consumer has is the cookie itself – cookies are inherently temporary storage mechanisms.
  • The second level of control is restricting the kind of data that companies can collect.
  • A third level of control over most companies in the space is to completely open the kimono and be transparent to the consumer about the information we have in a cookie about them and give them the ability to change those preferences or delete the cookie altogether.

We were one of the early advocates for consumer transparency – our preference manager was one of the first projects our R&D team built. By collecting only aggregate data points,  not collecting personally-identifiable data, keeping that data for only a short period of time, and being transparent to the consumer about what targeting attributes are associated with their cookies, we believe the trade-off to more relevant ads that are more valuable to advertisers and websites will make for a positive web experience – for all parties involved.

Occupy eXelate (Jobs)

In light of the big “day of action” by Occupy Wall Street on Tuesday, I thought it was an appropriate time to talk about a common theme of the protests: jobs. Over and over again we hear the chants of “jobs for the 99%.”

However, the positions of the protesters stand in stark contrast to the reality that my company and many ad tech start-ups face in NYC every day – too many jobs and not enough great people to fill them.

Currently at eXelate we have over 10 positions that have been challenging to fill at various levels of experience. And, in speaking with colleagues at other start-ups, they are experiencing the same issue. Meanwhile, recruiters are raking in the dough hand over fist to squeeze round pegs into square holes, while young, smart people are marching for more opportunity. Where is the disconnect?

I don’t profess to be an economist (though I did play one on TV), but in my opinion, the real factors that are making it hard to find folks to fill key tech roles in NYC boils down to:

  1. Education. We aren’t training either undergrads or MBAs to be competitive in the new economy. Grades as opposed to practical application and theory as opposed to practice are still the focus of an educational system that continues to train our young people as though they will all work at GE. The days of large multi-nationals driving domestic growth are over. Innovation is the key to our future. We need to educate our young people to take ownership, not orders; to think out of the box, not how to pack it better.
  2. Expectations. Now I am going to sound like my Dad (I guess I am a Dad so it is OK), but the concepts of “10th-place-gets-a trophy-T-Ball”, reality television as an easy path to riches, and the glamorization of any job that isn’t in an office (Mad Men excluded) have created the unrealistic expectation of what “rewarding” employment means. Interestingly enough however, I think that life in a start-up is one of the best ways to really experience the excitement of the highs and lows in life in an environment that tends to be much more inclusive (and yes, even coddling) than most large firms can offer. Sending this message loud and clear to our candidate pool can help slowly make an image change.
  3. Risk Taking. Start-ups fail…often. And start-ups in ad tech are no exception. Although there is uncertainty in any job, in any era, the recent recession seems to have created a generation fearful of taking risks when it comes to their future. This hurts the ability of an industry growing as quickly as ours to sustain that growth. We need to do a better job communicating the benefits of creative destruction for prospective employees and not penalizing those who have been part of a “failed enterprise.” They most likely learned far more than those who have only seen success.

We have one of the best teams in ad tech at eXelate, and we are always looking for great people who are looking to break new ground. As one of our newest team members noted when asked why she joined: “I didn’t want to be a cog in the machine. I wanted to be a part of a team that could get things done from day one.”

If you are interested in being more than a “cog in the machine” – take a shot at joining our team by contacting us directly. You can view all of our openings here.

Combining Data to Create Powerful Modeling

The Netflix Tech Blog recently posted an entry that discusses their recommendation algorithms and outlined the Netflix Prize, a machine learning and data mining competition to predict movie ratings. The 2009 winner of the contest improved Netflix’s ratings prediction system by more than 10% with a new algorithm. For a company owing 75% of viewership to recommendations, this would seem to be a huge step for Netflix. They didn’t adopt the winner of the contest, however – and the reasoning is perfectly logical.

The winning algorithm focused mainly on predicting ratings. Ratings are an important source of data for Netflix, but new types of analyses & inputs beyond ratings alone have emerged, all of which can help Netflix create even better recommendations. These include context, movie title popularity, novelty, diversity and freshness.

If you’ve been reading this blog or our Twitter handle for the last 2 months, then you are probably familiar with maX™ – or Modeled Audience eXtension, our custom modeling product that helps advertisers build a scaled audience with broad reach that is 3-5x more likely to respond to their campaigns.

We make it work by focusing on all the data – the advertiser’s first party data as well our eXelate premium marketplace data. And we look at as many data points as possible, including demographic, lifestyle, intent, behavior, brand affinity information and other proprietary data sets many advertisers may not have access to. We’ve learned, as Netflix seems to have, that combining multiple forms of data can prove to be the most powerful way to reach an audience. If you were Netflix, what would you have done?

Daylight Savings Time: A New Advertising Opportunity?

Recently, Freakonomics posted a blog about “cyberloafing” – surfing the web instead of doing work – the day after the Daylight Savings Time change, when we “jump ahead” an hour on Sunday and therefore lose an hour of sleep, making most workers a tired lot come Monday morning.

Who wants to work when they’re tired? Apparently, not many people, as the study showed that entertainment-related searches on the Monday after the time change were up 3.1% from the previous Monday and 6.4% higher than the following Monday (based on data gathered in over 200 US metropolitan cities over a 5 year period).

We at eXelate found an 8.5% increase in entertainment searches on Monday the 12th versus the Monday the 5th.

So, should advertisers be taking advantage of all this extra web surfing by consumers?

Maybe not everyone should rush to get more display time on the Monday after Daylight Savings Time, but it is a reminder that marketers should always be thinking outside of the box when it comes to targeting ads. There will always be the holiday shopping rush online and  consumers searching for spring break deals in February, but there are certainly other times during the year that online display ads can get a lot of play. In such a forward-moving digital world, any small event could cause a shift in online behavior. Be sure you’re ready!

Football Fans Increasingly Search for Travel to Indy

Since the beginning of the year, avid football fans have been following the playoffs to see if their teams would be the lucky winners traveling to Indianapolis for Super Bowl XLVI.  We took a look at the interest in Indy travel throughout the month of January, and not surprisingly, found a sharp increase in the states of New York/New Jersey and Massachusetts as the Giants and Patriots continued earning the W’s.

With the average Super Bowl ticket priced at $3,395, we have to think most people wanted to be in Indy just for the game-time atmosphere! How much would you have paid for a Super Bowl ticket?

The Big Game: Insights & Information Collected via Digital Media – Infographic

eXelate and the Council for Accountable Advertising have put together an infographic showing sports page stats, household buying tendencies, online ad impressions, and searched flights to Indy in preparation for this weekend’s big game. Check it out, and have fun rooting on [your team here]!

To download your copy, click here.

Q&A with Nielsen Catalina Solutions CEO Mike Nazzaro

eXelate was happy to announce this week that we are teaming up with Nielsen Catalina Solutions to help advertisers reach their digital advertising goals by allowing them to target audiences based on actual purchase data. We caught up with Nielsen Catalina Solutions CEO, Mike Nazzaro to get his perspective on the partnership, bringing CPG data online, and trends in digital media.

eXelate: How will Nielsen Catalina Solutions and eXelate working together benefit marketers?

Mike Nazzaro: CPG marketers usually have a definition of their ideal audience, commonly based on purchase and attitudinal characteristics irrespective of the media those consumers use. Data and analytics from Nielsen Catalina Solutions enable CPG marketers to define their high-value audience once and then place ads and offers that reach that audience in multiple media — online, mobile, televisions and print.  eXelate helps extend this capability using its platform, increasing the scale of Nielsen Catalina Solutions digital network across a select set of media channels. So, the strategic alliance helps brands reach consumers with more relevant digital advertising based on actual in-store purchasing behavior.

eXelate: What are some of the challenges and opportunities that you expect to see in the digital ad space in 2012?

MN: Given the convergence of television, online and the multitude of video platforms, such as tablets and smart phones, the importance of using precise ways to reach the desired audience and measure advertising effectiveness across platforms continues to grow.  The following implications and trends result from this convergence:

  • Agencies, traditionally siloed by media, are starting to evolve toward a consolidated “activation” team that works cross platform
  • Media fragmentation in all platforms increase the importance of using audience data with contextual placement to optimize effectiveness
  • Advertisers execute cross media, but the tools haven’t kept pace with the need

Until recently, advertisers seeking to execute across various media platforms have found the tools to be limited. But Nielsen Catalina Solutions is a leader in developing tools that work across multiple platforms. Data and analytics from our company enable marketers to define and identify their best customer segments once, and then place ads and offers that reach that audience in multiple media — online, mobile, television, CRM and print.

Let us know your thoughts about eXelate and NCS refining digital ad targets.

Predictions for 2012: Data is Everywhere!

From election campaign results to Olympic medal tallies, 2012 is going to be all about data.

Even though a foreboding sense of “data fatigue” seemed to be emerging at the end of 2011, from my analytically-biased point of view, data will once again be on the tip of everyone’s tongue in the coming year. Not, however, as the buzzword  “flavor of the moment”, but as a key component in all digital ad activity.  A few key predictions for 2012:

1. Data becomes the “lead” as opposed to the “follower” in digital media buys.

Data has been the media planner’s best friend for a number of years, helping them decide where to invest their client’s media budget based on the relevant data presented by each publisher’s/network’s sales teams. But as media planners become more and more conversant in data, we’re going to see original, proactive campaign plans based on both structured and dynamic audience composition targets. Media selection will become a secondary consideration.  And, although  pre-constructed “audiences” will still be important, particularly those based on robust branded data sets (such as Nielsen PRIZM clusters), custom segmentation based on performance criteria will lead the way for both DR and branding campaigns.

2. Cookie cutter data will lose traction vs. customized segmentation.

Per the above, advances in the quality of planning as well as innovations in data and audience modeling – based on the combination of first and third party data assets – will drive a new era in digital data targeting. The days of “one size fits all” data will slowly begin to fade.

3. Audience targeting breaks free of the PC.

As data targeting has focused on PC-based advertising to date, 2012 will see the process introduced to other venues, namely mobile devices and addressable TV. As mobile application companies and ad networks seek to accelerate their revenue and create more aggressive business models next year, data will be one of the first places they look. Addressable TV companies will start to come of age as well, as “test budgets” morph into real dollars as data-based audience targeting scales in the coming year.

4. Group buying becomes more refined.

As group buying matures in 2012, the “spray and pray” versions of daily deals and buying groups will have no choice but to implement better, more refined tactics to maintain sales and customers. The group buying companies that will survive 2012 will do so by integrating Geographical, Vertical and Audience driven targeting into their marketing operations in order to compete with declining uptake. As with the early days of online advertising, targeting will be the key for their survival as the novelty of group buying wears off.

5. The digital personnel crunch gets worse.

Online advertising is becoming  further entwined with the hardcore data analytics world, and the demand for smart, ad-savvy mathematicians is growing exponentially. MediaMath’s Joe Zawadzki nailed it – Mad Men are becoming Math Men, and we are short A Few Good Men.  NYC, the hub of the advertising world, will quickly lose traction unless local schools spit out more quants. The new Cornell-Technion partnership can’t come fast enough!

6. The election will be won and lost online.

If social media was a critical component of the Obama victory in 2008, particularly in swing states like Indiana and Florida, it will be even more critical in 2012. Audience targeting, obsessive community building, targeted tweets and rich candidate video experiences will define the 2012 election. The candidate that can deliver the correct mix of these ingredients will take home the big prize.

From politics to ecommerce, it’s clear that in 2012 data may not make the same headlines it did in 2011, but it will be a key part of every story.