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CROSS-DEVICE ATTRIBUTION

By Reid Spice, Vice President, Media Strategy, iCrossing


Emerging technology enables todays brands to track consumer behavior across multiple devices,
attributing more accurate value to each one.
ICROSSING POV:
INTRODUCTION
There is a growing anxiety among those in the advertising industry about cross-device attribution
and for good reason! The growth of mobile alone more than justifies the concern. Smartphone sales
continue to skyrocket, wearables are about to explode, and Google Glass and smart watches are
rapidly being joined by cars, refrigerators and baby monitors as devices that can access the internet.
However, our ability to understand and measure user behavior across these fancy new toys is a serious
challenge for advertisers.
Googles Estimated Total Conversions tool is a signifcant step toward understanding cross-device attribution. Essentially, if Google
can track conversions for 20 percent of its users (people who are logged in to Google) across devices, they will take that amount,
multiply it by 5 and then magically, they have cross-device conversion data for 100 percent of consumers. Although this is a good
start, it doesnt account for differences in behaviors across audience segments.
For example, IBM released some interesting data that points to larger cart sizes for iOS users vs. Android users. Adobe also reports
that conversion rates for iOS users are usually twice what they see on Android. These types of discrepancies in behavior can add
up when you employ an OS-specifc sample as a proxy for all users. Another downside to Estimated Total Conversions is that, for
Google to be able to track a conversion, the consumer must start with a search on Google.com. Clearly, with this limitation, many
conversions are being missed.
WORKING TOWARD A SOLUTION
Google is certainly not the only company trying to solve this issue. Other companies like TapAd, Drawbridge, and AdTheorent
have hitched their wagons to statistical IDs. What does that mean? TapAd explains that they model billions of non-PII data points,
isolating strong behavioral and relationship-based patterns across devices. Wow! Sounds fancy, but the true translation is: theyre
guessing. Sure, its based on data and models and sophisticated algorithms but its still a guess.
Apple has dipped their toe in the cross-device attribution water with their IDFA (Identifer for Advertising) technology. However, its
worth noting that the iTunes Store recently began rejecting apps that use IDFA without actually serving ads, which considerably
decreases the value of IDFA as a tracking technology. With mobile Safari leading the way in blocking third party cookies, Apple seems
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like an unlikely candidate to help advertisers solve this tracking challenge. The recent news that iOS8 randomizes MAC addresses to
help obscure in-store Wi-f tracking certainly supports the notion that Apple isnt rolling out the red carpet for advertisers.
Microsoft also has an advertising ID that is used in Windows 8.1 apps. Though the Microsoft ID is certainly valuable inside the
Windows 8.1 ecosystem, its not yet designed to address the cross-device issue. Even if it does someday, it will likely be limited to
Microsoft-powered smartphones and XBox consoles.
So, of all the ad networks and various technologies out there, who is leading the pack with regard to cross-device tracking and
ad serving? The answer is a little startup down in Silicon Valley called Facebook. Facebook doesnt have a cross-device problem.
Since all Facebook users must be logged in when they use the service, Facebook always knows exactly what youre doing, where
youve been and what ads youve seen. No guessing, no multiplying, just 100 percent accurate data across all devices courtesy of
the magical Facebook User ID.
This gives Facebook some very unique capabilities. For example, you can utilize ultra-precise reach and frequency capping at the
user level, across all devices. It also allows advertisers to retarget Facebook users across devices with bulletproof accuracy. Say
a user has already seen a Newsfeed ad on their laptop twice that day. Facebook knows to serve them something different on their
phone that evening. Remember, the average Facebook user spends over 15 hours a month on the service.
To be fair, there is another network that can do this as well: Twitter. However, Twitter lacks both the reach (215 million users vs.
1.2 billion on Facebook), and targeting options (Twitter isnt even sure about the gender of its users), making it a distant second in
the race. Is Twitter worth trying? Of course, but be sure to temper your expectations with regard to potential volume and targeting
accuracy.
After reviewing the industry players who are trying to crack the cross-device attribution puzzle, weve established Facebook is
currently leading the pack. Now, lets explore a relatively new ad product from Facebook that has a lot of potential, and also look into
our crystal ball to see what Facebooks advertising future may hold.
FACEBOOKS WEBSITE CUSTOM AUDIENCES (WCA)
So how can we take advantage of the powerful tracking capability of Facebook?
The answer lies in a fairly new cross-device ad product: Website Custom Audiences (WCA, for short). Similar to the very successful
Facebook Exchange (FBX), WCA is primarily a retargeting product. So how is it different from FBX? For starters, you dont need a
third party like Tern or Triggit to run WCA; just put a Facebook tracking pixel on your website and youre off to the races. The upside
is that this opens the door for a lot of mid-size and smaller advertisers who may not have been able to afford the budget needed to
run with a third party. FBX still has its advantages, though, as its the tool retailers need to create dynamic, product-based ads. Lets
go over some advantages of Website Custom Audiences:
Improved targeting capabilities
Since Facebook is (wisely) controlling the entire experience here, marketers can take advantage of all the Core Audiences targeting
capabilities that are missing with FBX (demographics, likes and interests, partner categories, etc.) Extra bonus for Facebook?
They get access to all of this juicy performance data! That may turn out to be almost as valuable as the revenue generated by ads
targeted using WCA.
Mobile app retargeting
Though the name of the product is Website Custom Audiences (or sometimes Custom Audiences for Your Website), thats actually
a misnomer: you can also target from inside a mobile app. Think about the power of that for a moment. Say you have a customer
who put an item in her shopping cart with a mobile app and then didnt complete the conversion. You can then retarget that user on
her laptop - where she is more likely to convert. Its also worth thinking about how you might use WCA targeting to exclude certain
users; for example, unless there is a great upsell opportunity, why spend money showing ads to customers who already subscribe
to your service?
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Targeting lookalike audiences
The fnal differentiator is that WCA lets you expand the reach of your targeting using lookalike audiences. Lets say that your current
WCA retargeting allows you to reconnect with 10,000 users each month. With WCA, you can expand that reach either with a highly
targeted lookalike audience (using the top 1 percent of the lookalikes Facebook identifes) or you can go for massive reach using
the top 5 percent of FB lookalikes. The best part is that its easy to create many different audience variations here - you can have
a pure audience of only people who have visited your site, then a 1 percent lookalike, a 5 percent lookalike, a 1 percent lookalike
targeted to men in their 30s, and so on.
Each audience can test different ad creative, bids, targeting, etc. Then you can get more sophisticated by teaching Facebook
about different actions on your site (shopping cart abandonments, logged-in users, users who have downloaded a white paper or
participated in an online chat) and then add 1 percent and 5 percent lookalikes to those audiences. Suddenly you have created
dozens of different audiences to test. This functionality gives advertisers the ability to retain customers via retargeting in addition to
tools that help them acquire new customers via lookalike expansions. Thats powerful.
So, does it work? If you listen to the nice folks over at AdParlor, the answer is a resounding yes. According to their research,
Website Custom Audiences + Lookalike Audience targeting delivered the cheapest CPCs, highest click-through rates, and lowest
cost per purchase in the News Feed. Sounds pretty good!
Audience Network
Website Custom Audiences is obviously a game changing ad product for Facebook, but where do they go next? At this years
F8 Facebook Developers Conference, they introduced a (for now) mobile-only external ad network for publishers called the
Facebook Audience Network. This is Facebooks second foray into an external, mobile ad network, and it sounds like something
that publishers are going to love.
Initially Facebooks Audience Network is geared toward driving mobile app installs and app engagement and, accordingly, the
ads will only show inside mobile apps. However, you can expect this to change over time as Facebook fne tunes how the ads are
served and expands this into the mobile web and the desktop/laptop/tablet web.
THE FUTURE OF CROSS-DEVICE ATTRIBUTION
Remember how amazing it was to see Adsense crawl a page, determine what the content was about, and then match ads against it?
Im guessing it wouldnt be too diffcult for the 1000+ ex-Googlers at Facebook to replicate (and improve on) that contextual targeting
technology, but with an additional targeting layer for age, gender, location, likes and interests, where you grew up and went to school,
etc. And add retargeting to boot.
An external Facebook ad network could be a real game changer and is something that should be keeping Google up at night. Its
trivial for website publishers to test different ad networks simultaneously and, if FBs performance beats Googles, well the decision
is clear. This is the kind of tidal shift that could take place in just a few months. Even small increases in performance make a big
difference to a publisher.
Like WCA, Audience Network should have no problem targeting across devices without the use of cookies. All Facebook has to do
is call their own user cookie, match it to the magical Facebook UserID and thats it. Completely closed loop advertising across
devices that now extends beyond the walls of Facebook.com. This allows Facebook to add an almost unlimited amount of volume
without oversaturating its users on Facebook.com heck, they could even serve fewer ads on Facebook.com if this really takes off.
What a concept!
Managing Audiences
As advertisers, how can you best prepare to take advantage of this revolutionary technology? The frst step is to adopt a clinical
process for creating and organizing target audiences. This includes developing a logical naming scheme for cataloguing important
audiences. Of course, at frst this may seem rather trivial, but once you have 200 audiences that you are trying to manage, it can
become fairly complicated. And your target audiences will grow quicker than you may realize. For example, lets say you start with
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a basic audience of website visitors that you want to retarget. From there, you might segment your audience to include only male
website visitors. Next, you segment those male website visitors by location. Finally, you further segment the audience by a particular
interest area. Youve just turned one audience into four, and that is only one, very basic example. Once you extrapolate your original
audiences using the top 1 percent and 5 percent of Facebook lookalikes, the resulting number can become unwieldy. Of course,
having an abundance of relevant audiences to target custom advertising to is advantageous for your business, but it requires a
thoughtful approach to maintaining them appropriately.
Another issue that advertisers must consider as this functionality rolls out is the possibility of audience overlap. With so many audience
segments, its entirely conceivable that you may be targeting the same user with three or four different types of offers. For instance,
a particular user might fall into the segmentation designated to receive winter coat offers. At the same time, this hypothetical user
recently abandoned a shopping cart, which means they will receive an ad that encourages them to fnish the transaction. Now the
individual is receiving both offers simultaneously, and becoming over-saturated by messaging, which can lead to no behavior at all.
For now, executing on these concepts is a manual process, because it is so new and tool providers havent come up with features
to help manage these audiences. In the near future, there will likely be automation capabilities developed to optimize cross-device
tracking, messaging, and attribution. Ultimately, advertisers who succeed will be the ones who intelligently and carefully build out
their programs, adapting based on incremental insight gleaned along the way. Though the road looks twisty and full of potholes,
were fnally starting to map out a path to cross-device targeting and attribution.
STAY CONNECTED
Find out more at www.icrossing.com
Call us toll-free at 866.620.3780
Connect with us at google.com/+icrossing
Follow us on twitter @iCrossing and @TheContentLab
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