Is behavioural advertising of online ads the way forward?

Is behavioural advertising of online ads the way forward?

Author | Jagadeesh Krishnamurthy | Monday, Aug 06,2007 9:34 AM

Is behavioural advertising of online ads the way forward?

Online advertising has seen an upward curve over the past few years in India, with various advertising models and techniques being adopted that have been followed across the world. Behavioural targetting of online ads is a relatively new phenomenon, worldwide too. India, amazingly, has already woken up to this new technique, with major online publishers and advertisers already adopting it to a certain extent.

Behavioural targetting is a technique used by online publishers and advertisers to increase the effectiveness of their campaigns by observing a user’s online behaviour anonymously, and then serving the most relevant advertisement based on their behaviour.

Worldwide, there are two major market players, Tacoda and Revenue Science in the US, who focus exclusively in helping publishers and advertisers implement behavioural targetting. Additionally, the large ad networks such as, ValueClick and BlueLithium have added behavioural targetting and are able to integrate it with geographic and demographic targeting. In India, Komli has been one of the ad networks to bring about such a system in the market.

MSN’s Rajnish notes that Microsoft has not yet implemented this service in India, but that it has already begun piloting it in outside markets. “Behavioural targetting of ads can be utilised in a better manner through services like messengers and mails. However, we need to set the standards on pricing and factors like ‘What should be the premium?’, and similar benchmarks have not yet been established.” AOL was in the news a couple of weeks ago for its announcement to acquire Tacoda. When questioned on its Indian impact, an AOL spokesperson observed that it would take time to have an impact in India. “Behavioural targetting is widely used in mature online advertising markets and it’s a phenomenon that will come to India in the coming years,” the spokesperson added. has conducted a successful pilot to adopt behavioural targetting in serving ads on the website. Manish Agarwal, VP-Marketing,, observes that adopting behavioural targetting ensures better results for advertisers as probability of users clicking on a given ad is higher, as the user is currently interested in the topic or category being promoted in the ad.

“This ensures increase in clicks for advertiser and optimal utilisation of inventory without sacrificing revenues. From an advertiser’s perspective, behavioural targetting ensures advertisers are able to make effective use of impressions and hence get higher ROI from their online spends. For an advertiser, this is one more step towards every marketer’s dream of identifying potential target audience and communicating proposition to them at an individual level in an effective and engaging manner,” Agarwal added.

Akshay Garg, Business Head, Komli, believes that this phenomenon is already emerging in India, but that it will take a little bit of time to become more accurate.

Yahoo! also offers behavioural targetting in several categories of potential commercial interest areas. These categories span across major business verticals, plus a variety of major life stages. Yahoo! claims to weigh several factors to predict where a consumer is in their progress toward a product purchase, and help determine what kind of ad would be most relevant to that consumer.

“Our targetting system uses advanced technology and enables us to connect advertisers with people who have shown recent interest in a given product category, who can be termed as ‘engagers’, and people who appear to be actively in market for that product, the ‘shoppers’,” a spokesperson explained.

However, this service has already ruffled some feathers among the privacy advocates, as this service requires the use of cookies which will be stored in the user’s computer, gathering data about his or her interests. Underplaying these concerns, Garg emphasised, “In spite of the cookies, I have no idea who he or she is or from where that person is, or nor even do I care to get that data. It’s just the user preferences that I am interested in. I understand it’s an unfinished technology, but it’s surely a step up from previous methods.”

Behavioural targetting service will not work for users operating from a shared PC, as in universities, colleges or most importantly, cyber cafés. According to the IAMAI report on Internet access in India, 39 per cent of the users still continue to access internet from cyber cafés. However, it also noted that the percentage of people opting for Internet at home is growing and stood at 31 per cent.

Behavioural targetting may definitely be the future of online advertising, but some of the points which could plague its growth in India include the massive popularity of cyber cafés, and lack of major advertisers and paying customers. We will have to wait and watch how the growing Indian Internet advertisers play this game in the coming years to know the future of this technology in India.

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