Targeted: A book review by Bob Morris

Posted on: January 21st, 2015 by bobmorris

TargetedTargeted: How Technology Is Revolutionizing Advertising and the Way Companies Reach Consumers
Mike Smith
AMACOM (2015)

A brilliant analysis of the breakthrough technologies that have helped drive advances in digital advertising

Since the markets in ancient Athens and then Rome, merchants have struggled to create or establish demand for what they offer for sale or trade. That challenge hasn’t changed since then but the means and resources have certainly changed and none is more significant than the Web, devised by Tim Berners-Lee in 1993. Total retail sales in the US, for example, topped $4.53 trillion in 2013, and ecommerce accounted for a significant portion of that growth, up 16.9% in 2013–or nearly $40 billion–according to new figures from eMarketer. In 2014, the total is estimated to be 4.32 trillion, with ecommerce accounting for about 14.5% of it.

As Mike Smith explains, “My goal in this book is to explain clearly how powerfully enabling technologies such as paid-search advertising and real-time bidding work. In addition, I want you to take you behind the scenes to describe how some of the industry’s most brilliant innovators developed such technologies and created the novel business models of some of the outstanding companies that serve the future of digital ad sales.” That said, he adds, “the distinguishing factors in success are often management skill, flexibility, and the initiative that only leadership can elicit.” And I presume to add that in the healthiest organizations, leadership thrives at all levels and in all areas within the given enterprise.

Smith provides a lively and eloquent narrative during which he examines subjects and issues such as these:

o The nature and extent of the online ecosystem
o The major dos and don’ts of search engine marketing
o The potentialities and limitations of online auctions and paid-search advertising
o Google: From David to Goliath and then….
o The relationships between display advertising and ad networks
o Real-time bidding and/or online advertising: New paradigms?
o How and why real-time bidding works
o Lessons to be learned from Right Media and the building of its ad server
o The impact (thus far) of analytics on digital advertising
o Data collection and its impact (thus far) on privacy

Smith devotes the last chapter to the significance of new technologies (e.g. mobile telephony, tablets, and the adoption of apps that make use of HTML 5, as well as addressable TV). He suggests, for example, that there are five main reasons for the surge in mobile advertising (Page 160) and discusses what he characterizes as “the tablet tsunami” (161-166) before shifting his attention to the “changing landscape” (e.g. the increasingly greater pressure that mobile devices put on “the web-browsing model that has ruled for so long”), and the apparent (probable?) future of digital TV advertising.

Who will derive the greatest benefit from this book? Obviously, those who are primarily responsible for creating or increasing demand for (i.e. marketing) products and/or services. Also, decision-makers in agencies that are retained to help achieve that strategic objective. And also, those now preparing for a career in business or who have only recently embarked on one: they need to understand where the greatest (probable) needs are — or will be — so that they can formulate or revise their career plans.

When concluding his book, Mike Smith observes that “it has been the development of online ad technology, with its capacity for using data for great specificity in targeting and then optimization, that started the inexorable process that is disrupting TV advertising.” In fact, it is directly or indirectly disrupting every business that relies on a sufficient number of profitable customers to survive. For that reason, all business leaders need to read and then re-read this book or they will be insufficiently prepared to understand — and then take full advantage of — the disruptions now in progress as well as those that are certain to appear in months and years ahead.

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