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September 25, 2011
Unifying Direct Marketing Principles with Internet Advertising Reach

Direct marketing allows my alma mater, Saks Fifth Avenue, to successfully market to its audience — a tiny, hidden portion of the US population. Relentless analysis and campaign targeting drive tremendous business for Saks and other direct marketers. Yet, with the exception of Google AdWords, the same principles to not exist in online advertising, where, because of the fragmentation and chaos that come with tech revolutions, a "spray and pray" method seems to dominate.

Internet advertising inventory is nearly infinite. In the Q1 of 2011 there were 1.1 trillion display ads served. By 2015 there will be 10 trillion US online ad impressions. For many marketers Internet advertising economics are not favorable — vast ad inventory does not translate into vast profits because only a tiny sliver is relevant to the consumer. It's not that advertisers prefer to waste messages on the wrong people because it's easier. It is because advertisers cannot scale relevant audience buys economically.

So, what if we combine the principles of direct marketing with the reach and collaborative power of the Internet? It is conceivable that such an approach would allow advertisers to search for, find and market to their core audience and get the best of both worlds Ð the reach of the Internet with the yield and ROI of direct marketing. This would mean ad engagement rates could jump from 0.2% to 2%. One could argue that the $25 Billion spent on digital ads would be worth $250 Billion - imagine that. Brilig, the data co-op market for digital advertising, is making this kind of leap possible

Paul Cimino

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