SEMs Discuss adCenter

Search marketing execs had mostly good things to say about MSN adCenter during an SES panel today on behavioral & demographic targeting.

It’s clearly a thrill for them to be able to boost their keyword pricing to a certain geography, gender or age group. They’ve been able to do behavioral targeting on Yahoo! for several years. AdCenter is different, bringing very detailed registration data to search targeting. They’re amped about it, and they’re calling on the other engines to pony up more data.

“I think the writing is on the wall for the other engines to be capitalizing very soon,” said one panelist, Danielle Leitch of MoreVisibility. She noted selecting for or against demographic traits is common in e-mail and direct marketing, and she said this is the direction search will move.

But demographic targeting of keywords is really hard from a data management perspective, requiring an affinity for numbers that verges on the autistic. You can boost your bid for a gender, age segment, geography, day-of-week and time-of-day, or for any combination of these. Panelist Kevin Lee estimated a single keyword can have as many as 7,500 demographic permutations… and therefore, price points.

Danny Sullivan, who moderated, had this advice for the arithmetically disadvantaged: Ease your way into it. Decide which demographic traits bring the highest conversions by analyzing your existing customers, and start with that trait. Establish two bid levels for each keyword. A base level for ad buys not targeted on behavior, and one for those that are. Add new factors bit by bit.

Targeting also raises big privacy issues, and the panel only brushed against them. Dana Todd, SiteLab’s impish founding partner and ever a voice of dissent, put it nicely: “I find it particularly ironic that this session is not called adware/spyware buys,” a name commonly given to behavioral panels two years ago. “Now that ‘legitimate’ companies are essentially spying on you and… serving ads, it’s ok,”she said.

So far, it’s just MSN and Yahoo! playing in behavioral and demographic targeting, and the panelists discussed both. So three guesses which engine was the elephant in this room.