Tuesday, October 27, 2009

The 300%-500% Lift Meme

I talk to a lot of people trying to make internet advertising more effective, most of them startups or people socializing a new idea before starting a company. Over the past two years, I think about two-thirds of them have told me that their new technology/process is going to provide a "300%-500% lift."

I even heard a story of a VC, after being pitched on a more reasonable lift, say "your approach is interesting, but we need to see you deliver a 300%-500% lift to be competitive in the market." ( I looked at this VC's website and found no ad targeting companies in his portfolio.)

Sometimes upon hearing this, I drift into a daydream about combining behavioral targeting, social targeting, retargeting, creative optimization, rich media, distribution optimization, contextual targeting and offer optimization technologies into one super-arbitrage strategy. The resulting 328,050% - 19,531,250% lift would allow me to buy $0.50 CPMs and pretty much overnight control the US economy*.

Assuming, of course, that these lifts are real, are the average lifts, are replicable at scale, are actually the result of the data/process/technology itself and not some artifact of attention (i.e. the Hawthorne Effect), and are orthogonal (which I'd expect if they are real and not artifacts, maybe not to the extent of the last paragraph, but between, at least: targeting, distribution, creative/offer/media.)

Not sure where this meme originated, but it very clearly says one thing: noone knows nothing. How well any of this technology works is an open question.

* I suppose, in a way, this is kind of what Google did, so I'm not saying it's not possible, just that I doubt we can all sit down at our laptops and replicate it.


Codec said...

The big lie here is that a 0.02% to a 0.08% CTR is a 400% lift... Why don't we focus on the on 99.02% of waste? This is where dynamic creative and dynamic web experience like Maginify 360 comes into play. We are hitting the ceiling of data targeting unless the web ex, and creative start scaling.

Jerry Neumann said...

What's the lift from Magnify 360? :)

Seni Thomas said...

Maginify 360 posts lifts on conversion around 10x. Depending on integration, use of targeting data, and dynamic creative implementation. All these wheels need to be turning together to really work, which is why I believe that all the data/audience targeting gains are hyped when working in a silo. X+1 also has a product called Site+1 that generating dynamic landing pages. Just announced a case study with Delta that did very well.