Behavioral Targeting Most Effective?

That is the belief of many Madison Avenue advertising executives. Compared with other forms of online targeting, behaviorally targeting ads is the best way to raise conversions, according to a new study.

by Kristina Knight

The study, by the American Advertising Federation, polled 168 industry executives. Of those surveyed, more than 52% said behavioral targeting – giving users ads based on past Internet surfing activity – was the most effective way to target ads. Demographic (32.9%), contextual (30.5%), geographic (14.6%) and other (4.9%) rounded out the top five.

Next year, online advertising budgets are expected to climb 42 percent over 2006. As more advertising dollars are slated for the online marketplace, knowing how to target ads for the best response is crucial for online marketers. Basing ads on past behavior has been shown to influence purchases. Search advertising is expected to take over the largest share of the market.

Another interesting result is that 71% of respondents believe search was either very effective or the most effective (71%) form of online advertising. Online video is also favored with 33% saying between 10 and 20% of their broadcasting budgets would switch to online video in 2007. Social networking (33%), video games/podcasts (23%), mobile (20%), blogs (19%) and RSS feeds (11%) are also favorite online advertising mediums.

Tags: behavioral targeting, online marketing, online video, search marketing