Predicting the Biggest Trends and Innovations for 2011

Posted by Kate Jurras on Mon, Jan 10, 2011

Guest post by Mike Afergan, CTO & SVP of Advertising Decision Solutions at Akamai. This is one of several guest posts in the MITX 2011 Perspectives Blog Series. Stay tuned for more posts by Boston's most influential thought leaders.

1. What will be the biggest trend or innovation for 2011?

A big trend with lasting impact for 2011 will be the shift towards a more relevant Web for consumers.  The power of this trend starts in the fact that it's beneficial for (and will soon be required by) consumers.  The success of the trend comes from the fact that it is also hugely beneficial for marketers.  

The experiences that individuals are coming to expect on the Web – on-demand access to content of particular interest to them – will largely shape how people come to accept the advertising that they see.  Today, people set up and read personalized news feeds, follow the musings and links of their friends and colleagues on Facebook and Twitter, and access videos of their choice on iTunes and Hulu.  The Web today has evolved towards tailoring for the individual.  online resized 600

Online ads will necessarily follow that trend.  Frankly, if they didn't it would create a bizarre experience for consumers who are accustomed to a relevant experience everywhere else.  A parallel can be drawn to standard definition ads shown on HDTVs.  Quickly, brands have begun to realize that showing old ads on new TVs has significant and negative brand impact – that the cost of creating ads in HD is far less than the cost to the brand of using the old, SD ads.

As the online ecosystem further evolves to more relevant experience, it’s apparent that brands will have to speak to people online in this new and timely way.  This dialog with consumers in fact is part of what a brand will stand for even more now.  Consumers will eventually reject web experiences that aren’t, in some capacity, relevant to them - and similarly will reject online ads that are not relevant to them either.

2. What industry tradition, conventional wisdom, or long-standing “way of doing things” should be re-invented or changed in 2011?

At the end of 2010, the online advertising industry is still focused on the age-old challenges of greater spend, scale, and efficiency.   This is the result of major issues in advertising measurement that need to be solved, and I’m hopeful that we’ll see major progress in 2011.  

In 2011, we as an industry need to evolve to better understand the impact of online advertising versus relying on crude proxies.  Specifically, two changes to the conventional approach would help the industry grow and take a larger portion of the global advertising pie.   First, abolish the old-fashioned tendency to focus on, and optimize for, clicks.  Second, move away from a “last-click” focus to a multi-channel attribution model so that marketers can understand how various marketing channels work in concert with one another.

Moving away from clicks

Despite overwhelming evidence that optimizing for clicks in any online display campaign is likely misguided, this practice continues.  ComScore noted recently that 8% of online consumers do 85% of the clicking, and that 8% tends to score fairly low on the list of demographics advertisers are looking to reach.  When e-commerce advertisers optimize for clicks, they’re relying on the idea that clicks are tangible and measurable in a way that impressions or views are not.  But no business makes money off of clicks alone.  For a retailer, it’s a sale.  For others, it may be a download, or a contact form, or a view of a video.  The trick is to isolate which engagement means most to the advertiser’s business, and optimize for that.  

Evolving towards a multi-attribution model

Likewise, many advertisers continue to give full marketing credit to the last ad to touch the customer before buying.  Again, this is the industry relying on what is easy.  Instead, there is much data to support instead measuring all marketing touches prior to a conversion and giving weighted credit to all the ways in which an advertiser touches a customer.  When companies give full credit, for example, to the last search query that was clicked on before a purchase, they tend to undervalue other marketing channels such as online display, email, and affiliate marketing.  The reality is that the last "touch" prior to a purchase is a necessary – but not sufficient – condition for a conversion.  In 2011, advertisers who are able to understand how their various marketing approaches lead to a desired outcome will be more successful in growing their businesses.

Did you just discover this series? Don't worry! You can check out our last post, by Matt Cutler, here!