Behavioral Marketing:

How Behavioral Advertising Works

Lots of platforms work by inserting a cookie into a visitor’s hard drive. Advertising networks have a larger demographic of users at their disposal. Being able to serve different sites, they can easily divide the populace into segments.

The first step in serving behavioral ads is tracking who the users are and what they do online. In order to understand how tracking works, we need to define a few terms:

HTTP request: Generally a tracking pixel or JavaScript sends client information to the ad serving company. The user is identified with the help of a cookie in which unique IDs are stored. Furthermore, combining HTTP request headers with UserAgent strings can lead to even more precise User Identification.

Flash Cookies: Flash allows advertisers to place Flash cookies known as local shared objects with the ability to store client information. The Information can range for preferred volume settings or even unique identifiers. ne of the notable advantages with Flash cookies is that they are outside the browser. They persist even when the user closes the browser, and they carry through when he/she opens another. While standard HTML cookies store 4kb of data, Flash cookies can store up to 100kb. There are mechanisms which keep track of the user even when he/she deletes the cookie. For example, say cookie named 144587 is attached to my IP. Imagine that I delete the cookie. The next time I log in, the server attaches a cookie with a different name, say 8654977, but the software knows that both cookies relate to the same person. This is called cookie respawning.

Etags: Etags are a feature of the browser cache. The cache saves a previously visited website in the memory, and if a visitor is inclined to visit the site again, the saved site is shown. Advertisers use the cache to store unique identifiers pertaining to the user. Etags are difficult to remove because deleting the cache would make browsing slower.

HTML5: HTML5 makes use of a cookie called HTML5 local storage. Even if the user closes the browser, the cookie persists until deleted willfully. Compared with Flash and simple HTML cookies, HTML5 cookies can store data up to 5 Mb. It is preferred because users don’t need any plugins like Flash to run it.

The EverCookie: The EverCookie uses the combined features of HTML5 cookies, Etags, Flash cookie, etc. If a user deletes one identifier, say Flash cookie, then the other identifier, say Etags, is enough to activate the EverCookie. AOL has explained it beautifully with images of Penguin. When you visit a sports site or gourmet site, for example, an ad company sends a cookie to your computer. Later, when you visit some other site, the ad company reads the cookie and displays an ad related to gourmet or sports.

Let’s go into more detail on two pieces of data that advertisers use to create targeted ads:

IP address & geolocation: Targeting your audience by where they live is one of the most basic segmentations you can make. You can show discounts and sales targeted to a specific region. You also can blend urgency into the messages, such as: “This offer is only for Utah readers and expires in 10 hours.” There are even more metrics you can add, like the person’s country, state, region, and city. Verve, after comparing data from its 2,500 mobile targeted campaigns, found that mobile ads that are geo-aware performed 50% better than the rest of the campaigns. In another study, Central Market saw a 4.1% click-through rate location based targeting.

Recency of visits & whether repeat visitors or new visitors: A repeat visitor can be shown related content based on what they searched for in the past. You might have seen yourself that, when you visit some sites to search for certain things, you later see ads of those sites elsewhere. Amazon does this. They even email users based on the products they browsed earlier. Personyze is a platform that offers real time personalization based on user data. How does that happen? It’s called retargeting.

When a user visits a site, he/she is expressing interest in the site. Later, the user can be shown ads related to the site.

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