Tag Archives: Digital advertizing

Updates from Chicago Booth

Without cookies, online advertisers have to piece together crumbs
By Brian Wallheimer – Google announced this year that it would eliminate automatic third-party cookies on its Chrome browser. The company joins Apple and Mozilla, which earlier made users opt in to the technology on their browsers. While Google’s move may be positive for users who want privacy, it’s bad for companies that want to target ads to specific audiences.

Boston University’s Tesary Lin and Chicago Booth’s Sanjog Misra evaluated the alternatives for advertisers. Building an analytical framework and conducting an empirical experiment, they find that advertisers have few good options for constructing accurate user profiles.

“The system was already broken and imperfect,” Misra says. “Any time there is fragmentation, anything you want to measure is going to be off to some degree. Now the rules have changed, and it will exacerbate that fragmentation to a much greater degree.”

Cookies are tags from websites that live on a person’s computer or internet-capable device. When you search for shoes online, the search page and the sites you visit leave cookies that can be collected to tell a company such as Zappos that you’d be a good target for an ad.

Because people use more than one device, a third-party company can collect cookie data to see a person’s browsing history. These companies use a data-linking strategy to cross-reference cookies to see where names, email addresses, and other identifying features overlap and then stitch together a more complete user profile. Advertisers can track if an ad is effective, even if that ad is viewed on a smartphone by someone who bought the shoes on a laptop a day later. more>

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Updates from Chicago Booth

Digital ads are getting smarter. Are advertisers?
By Alina Dizik – Check out a pair of shoes online, and you may find them following you around: in a display advertisement parked in the margin of a news story, or in the otherwise minimalist corner of a search-engine results page, or perhaps in the subject line of an email.

That’s because digital advertising, and the technology that drives it, is evolving.

Paid search is internet advertising’s biggest stream of revenue, with nonmobile search alone generating $19 billion in 2014, according to the Interactive Advertising Bureau.

But Chris Nosko‘s research indicates that when eBay stopped paying for ads to appear during keyword searches that included its name—for instance, “eBay camera”—it nevertheless retained nearly 100 percent of the click traffic to its site. In the absence of paid ads, consumers could simply click on the nonsponsored search result linking to eBay instead.

.. the most accessible metrics are often also the most imperfect. When they paint a rosy picture of digital advertising’s impact, there could be a disincentive to chase more accurate measures.

“Most people would prefer not to be held accountable for business metrics over which they have limited control,” says Randall A. Lewis, a senior economic research scientist at Netflix who has worked for Yahoo and Google. “In digital advertising, we have a whole bunch of correlational metrics and a lot of them tell a positive story.” more> http://goo.gl/D8QaZO

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