Re: online targeting

From: <TLee_at_webcmo.com>
Date: Tue, 2 Feb 1999 06:02:59 -0600 (CST)

LEO SHEINER LEO_at_NETCOMUK.CO.UK WROTE:
>It is interesting to note how Tim is capable of very selective
>editing and interpretation. Makes it sound like I was just about to
>hire him.
>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Leo, if you read my last post very carefully, you may notice
that it never intent to edit or interpret your excellent
post about online targeting. I just brought up some new
stats to illustrate some online targeting issues and our
attitudes toward interpreting some statistical results.

I am not sure you can afford to hire me. About six month
ago, CNet has approached me and asked me whether I was
interested in a position at Snap. I said I liked my position
at WebCMO: do whatever I want to do because I see marketing
research as a hobby instead of a business.


LEO SHEINER LEO_at_NETCOMUK.CO.UK WROTE:
>Interesting stats but of course Tim totally misinterprets them.
>He infers from this tiny snippet of information that online
>advertising is expensive. On what basis does he come to
>that conclusion? What does he mean by the phrase very
>expensive - compared to what?
>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

I simply used this stats to illustrate the issue. But my
general conclusion was not from this piece of stats but from
our research analyses: that's why online advertising
penetration is low and effectiveness of online targeting is
questionable.



LEO SHEINER LEO_at_NETCOMUK.CO.UK WROTE:
>There is only one way to
>judge if a promotion is expensive. If you spend money and
>fail to make the return you needed it is expensive. If you get
>what you needed it is the right price.
>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

You statement is partially correct. As all of us know, to
make a marketing decision and calculate whether it is an
optimal solution, we need to compare other opportunities.
Even your online targeting brings you positive profit, it
may still not be a good decision. For example, many people
want to know how to target demographically (mainly area)
online. In such targeting campaign, even you get profit, you
may still lose a chance to get more profit by using
traditional media.


LEO SHEINER LEO_at_NETCOMUK.CO.UK WROTE:
>Tims more detailed research may be fun for him but rarely
>appears to add to the sum total of human knowledge. To make
>general inferences from the specific case where many factors
>are totally unknown is foolish. The suggestion here is that
>well targeted banners will always get a lower CTR but higher
>conversion. That is clearly nonsense.
>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Leo, I don't know whether this is a selective editing or
misinterpretation. In the last paragraph of my last post, I
stated:

"There are many other factors influencing the effectiveness
of banner advertising. Before we measure the effects from
other factors (not treat them equal), we are unable to
explain these two unexpected results."

As a matter of fact, the conclusion that online targeting
generates low click through rate but higher sales was
directly from Iconocast. In fact, it is hard to explain this
states: your targeted population has lower interest in the
product (lower CTR) but if they are interested in the
product, they are more likely to purchase it (higher
conversion rate). I doubt we can approach online targeting
in this way.


LEO SHEINER LEO_at_NETCOMUK.CO.UK WROTE:
>If anything in the stats
>he quotes is interesting (and probably typical) it is that the
>bottom line cost of making a sale in this comparison is cheaper
>with the untargeted campaign because of the considerably
>higher (five fold) cost of targetting.
>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

I am glad finally we have something to agree with. Leo, if
you think the bottle is half full, we may have more to agree
with.


Best,


Tim Lee
Editor -- Journal of Web Marketing Research
http://www.WebCMO.com
A site dedicated to web marketing research


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Received on Tue Feb 02 1999 - 07:22:55 CST