As we collect more data we can make more rational, performance based decisions. This we all agree upon. But how often do we change our ways once we have better data? Often times ingrained habits take precedence over actionable information solely due to the fact that it’s a habit. Further, if a large group of people who have the incentive to mirror each other’s actions are faced with the above dilemma – how long until they act?
First consider the power of habit. Some say if you do something for 21 days, it’s a habit. What if an industry has been doing something for 21+ years? Individual inertia is much easier to create or halt than industry inertia. A much larger machine, or network of machines cannot be replaced as quickly as a personal computer.
So, just how much money is wasted on advertising? How many times will people quantify “engagement,” and “interaction” in an attempt to justify purchasing media. Probably numerous times, no…many more times yet.
So is performance marketing the future? Is the Internet, (the best context we have for behavioral ad targeting and data collection) going to revolutionize the way companies spend advertising money? Yes. It’s the only way things can ultimately play out, with a few caveats.
The scaling of the above will be proportionate to our ability to segment, target, and re target groups of users. There needs to be many more definitions of “user” that exist already. Emo, or young adult, senior citizen, etc……this isn’t enough to let performance marketing overtake banners and the current waste we see now. One day, the musician from your Myspace page will follow you as you surf the net to be sure you’re aware of the new CD coming out on the 11th. Cookies will be placed on your PC once you log into your social network and they’ll get paid based on their ability to target effectively.
The keys to success are data and the ability to analyze and act upon it…most people won’t be able to and this will reduce efficiency & publisher profits will prevail for a while longer, but something will breakthrough, or the government will intervene (as if most often the case). As for now – I very much doubt your neighbors knows people have cookies on his browser waiting to meet Mr. Pixel over at Amazon.com! Long way to go folks.
I bet he wants Chinese food! Based on some future metric that one day will be collected from his sniffing cellphone which regresses day/time with food consumed. Monday night at 7pm , really high R^2!
What’s your fortune?
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