Display And Search

There’s been much talk over the last few days about the impact of the launch of version 2 of Google’s Doubleclick Exchange (“AdX”).  Adexchanger covers it very well here.  Most have focused on the huge amount of scale, the benefits of RTB, and the impact on the exchange market itself.

But what’s most exciting about this launch is that it is really the first time we have seen search marketers and display marketers go head-to-head with all of their respective tools available.   This is the Shaolin Monk vs. the Ninja in Mortal Kombat.  It’s Gorilla Monsoon vs. Muhammad Ali.  Different weapons, different skills, who knows what’s going to happen.

Some may say, “well, search marketers have been running display in the content network for years.”  Yes, they have, but not with the tools traditional display marketers use (eg, targeting data, view-based attribution).   So let’s get it on!

Search Marketer Tools:

Keywords – SEM’s have become pretty adept at managing the content network using sets of keywords.  This is the primary targeting tool SEM’s use in the content network and it leverages the extensive learning from search campaigns.  However, the tools at their disposal still do not give them the control they need to really optimize.  How the lists of keywords are applied to pages to identify context remains a black box.  Within Ad Groups it is impossible to determine which keywords are performing well and which are not, which makes optimization a bit of a guessing game (to put it lightly).   Use of keywords will offer no real advantage in most categories where display marketers will bring some of the tools I’ll describe below.  Yet, search marketers should maintain an advantage in categories where context is key and where data is not valuable or not available.  For example, health is likely the last category that will be tackled by the audience data experts (if it ever is), so the only way to target people interested in specific conditions (eg, diabetes) will be keyword driven targeting.  Advantage: Search (at least for a little while)

Placement Targeting - Placement targeting allows the marketer to pick specific sites on which they want their ads to show.  This gives the marketer more direct control of where their ads run.  However, this is a tool with which display marketers are very familiar and they should be able to quickly put that experience to use ramping up on the exchange.  Most exchange buyers are salivating at the transparency AdX promises.  Advantage: Even

Text Ads – This is an interesting one, and my conclusion is likely a bit controversial.  The success of Google has driven many marketers to believe that Text ads are superior to Display ads.  I don’t subscribe to that theory.  Google has dominated due to targeting and a unique and dominant position at the end of the purchase funnel.  Text Ads are uniquely suited to being presented results for search queries – but there is no reason to believe they are well designed for eliciting response when presented to a browsing user.  Display allows you to tell a story in more than 3 lines while allowing you to do things which attract the attention of the consumer.  We do not see TV commercials that are just 3 lines of text, nor do we see billboards or magazine ads (besides classifieds).  Where display fails is that it’s hard to do and it cannot sit at the end of the funnel.

This belief in text ads has actually spread to the display side where I’ve actually seen marketers create display banners that look like text ads – with 3 text listings hard-coded into a display unit.  The only advantage of this is it allows the use of view-based attribution and audience data (which I’ll describe below) but it ignores the true advantages of text ads – which are the ability to quickly and easily optimize the text creative and to target based on keywords.  While I’m sure that many on the search side will howl when I say this, I have to say that for Ad Format… Advantage: Display

Display Marketer Tools:

Targeting Data – Targeting data includes remarketing data (eg, target someone who has been to your website). behavioral data (consumer has shown they are in-market for travel by searching for hotels) and demographic data (consumer has reported that they are a 34 year old male).  Display marketers have become highly skilled at using this data in making display campaigns achieve their goals.  Many display campaigns require remarketing as a core component to achieve the advertiser’s goal (just for kicks, ask your network salesperson if he’ll run your DR campaign without placing a remarketing pixel, go ahead, I dare you).   Both Brand and DR campaigns benefit greatly from the use of in-market behavioral data (as just one example) to assure that they are addressing the right audience and hitting the goal.  The only advantage I see for search is that many of the larger SEM’s can bring search keyword remarketing data to the table.  Currently, the search-based data available comes from 2^nd tier search engines or is from other proprietary but imperfect means.  SEMs will have the data from clickers on their search campaigns for the very advertisers they will be bringing to the content network – which is incredibly powerful.  Despite that, I believe the learning curve for applying cookie data to display is still great enough to make it Advantage: Display

View-based Attribution – this is perhaps the most effective tool in the display marketer’s belt and could be deadly when going head-to-head with search marketers.  SEM’s have been making the content network work for them without any ability to measure the impact of just seeing, but not clicking on, the ads (which we know is extremely powerful).  They have had to rely on clicks, which on websites are simply rare events.  It’s as if they played a whole football game and nobody told them about the forward pass.  Google did allow 3^rd party ad servers on the content network last year, but due to the trafficking nightmare, I can’t imagine many, if any, set up separate ad tags for every keyword, placement or even ad group to enable true view-based optimization.  Many display campaigns with even a short post-view window will see the overwhelming majority of attributed conversions come from the post-view attribution.  It’s important to point out that this is absolutely valid and the impact can be tested and proven.  Imagine if marketers evaluated magazine ads or billboards only based on consumers who called the advertiser the moment they saw the ad.  Where Search may have an advantage is that they have learned to make campaigns work relying solely on the click, whereas display has shown that clickers may actually be bad.  So there will be a period of normalization here where both sides learn a bit from the other.  Even assuming SEM’s are twice as good at making clicks occur and work, the enormous amount of conversions display marketers can demonstrate post-view enables a much higher CPM bid and should allow smart display marketers to win a great deal of inventory (it could actually be unfair).  Advantage: Display

Real Time Bidding – this has been a bit overdone, but being allowed to bring your own algorithm, data and intelligence directly to bear at the decision point is incredibly valuable.  Perhaps more amazing is the ability to see all the impressions that you do not win or just do not want.  That drives a lot of learning.  Advantage: Display

Display Ads – The inverse of the “Text Ads” piece above.  Display is hard – it requires ad trafficking and serving – which are hard things to do and still require a lot of bodies.  Even now it’s hard to find people who can do this well.  Sure, there are technologies out there that attempt to make this easier (eg, AdReady, Google’s Adbuilder) but these solutions tend to focus on the creative building piece and not the trafficking and measurement piece.   Simply due to experience, the Advantage has to go to Display, though I won’t count it here since I already gave Display the advantage above under Text.

Conclusion

As a display guy, I have to admit I’m a bit biased, but I think the display marketer has the upper-hand in this fight.  Display marketers will be in a much better position to absorb and use the search tools (particularly placement).  Displays’ tools are, and this is a broad generalization, completely new to the search marketer.  The workflow process around managing display advertising should not be underestimated as a barrier to SEMs entering display (eg, my mother could launch a search ad in about an hour whereas I have been in display for 7 years and could not launch a 3pas display ad by myself if given a week).  Hiring an experienced display ad ops team is hard and expensive and takes awhile.

But the search guys are smart and fast.  The larger SEMs took the digital agencies’ business and served it to them for lunch when search was originally ramping up.  Many of them think they can do it again.  Display has to move quickly, get in, take control, scale up, seize the offensive and go all Rex Ryan on search within AdX.  This means quickly launching and scaling RTB integrations, utilizing all the tools available, continually developing new tools ahead of the curve, and absorbing all the capabilities Google is going to give to the search marketers to help them keep up. For example, a display marketer using RTB may not need keyword targeting, but she sure as hell better understand how to use it and how it is developing.

This is going to be fun.

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