Audience: New King of the Hill?

If content is king, audience is quickly challenging its right to the throne. Advertisers are using new technology tools, and deep pools of data, in order to find the audiences they want without having to rely on content.

Here’s how it works: Advertisers can hook into large ad exchanges and set a price they’re willing to pay for a particular audience. When a user arrives at a Web page, the exchange makes a decision based on the data available on the user and the bid submitted to find the best-matching ad. The matching is done in real time, banner by banner.

The method works. According to a recent study by players in the market, audience targeting that used real-time bidding increased campaign performance by 324 percent compared to an untargeted campaign.

The key for buyers is the use of data, both client info and third-party data from sources like BlueKai and eXelate. Those companies offer access to anonymous user data to find users that through their Web behavior have shown to be in the market for a car or interested in flights to Boston.

“It’s no longer about sections and pages, it’s about people and actions,” said Eric Porres, CMO at Lotame, a marketing tech company with an audience data platform.

While advertisers have clear benefits from the shift to audience buying, it’s a different story for many publishers. The system upends core tenets of the media industry. Traditionally, media companies have packaged audiences for advertisers; in a turnabout, advertisers are  finding audiences on their own, only buying impressions that fit their criteria in real time.

“Advertisers often know more about an audience on a specific publisher’s site than that publisher,” said Terry Kawaja, CEO of investment bank LUMA Partners.

It requires publishers to adjust their approach. That’s the thinking behind a new move by Gannett, which is implementing technology from ContextWeb to allow advertisers to reach specific audiences, although still tied to content. In the past, Gannett could only sell broad category deals in “health.” Now, with ContextWeb mapping each piece of content to more specific categories, it can sell cholesterol and diabetes content. “It’s another way for them to segment the inventory to provide better value to the advertiser and better value to Gannett,” said Jay Sears, gm of ContextWeb Ad Exchange.

For publishers like Gannett there isn’t much of a choice in the matter. The audience revolution has attracted the biggest players to the field. The major holding companies have all set up trading desks to push forward audience buying. Google has made this push a cornerstone of its effort to expand beyond search, using its vast  resources to develop the leading platform for audience-based buying. And it operates DoubleClick Ad Exchange, the top ad exchange, where  buyers can find available ad space. Yahoo also has an exchange with RightMedia. There are over a half dozen other exchange sources.

Some top-tier publishers, such as The Wall Street Journal, are nonetheless sitting it out. The company is remaining closed to ad exchanges, said Mark Fishkin, head of digital sales at The Wall Street Journal Digital Network. Others like Time Inc. and NBCU are seeing how audience buying can help them.

NBCU isn’t keen on open ad exchanges, but is working with holding companies to develop private exchanges that will allow it to set minimum prices, keep out certain advertisers and, perhaps most importantly, maintain control of its audience data. It went a step further in July with the creation of the Universal Audience Platform, an in-house network to find audiences across NBCU properties.

“There are cottage industries being built off publishers,” said Nick Johnson, svp of digital media sales at NBCU. “You’re going to see a lot of publishers taking their data back.”