Innovation in the Inbox: Programmatic Advertising in Email and the Rise of Identity Marketing

“We look at the inbox as probably the most intimate place you can be on the web,” says Kerel Cooper, VP of Platform Development for LiveIntent. “When you’re looking at a piece of content in your inbox, there’s no other place where you’re more engaged.”

He makes a good point – we tend to have a different reaction when viewing content sent to us versus reading it on a webpage or even seeing a link posted on a social network. So why not offer users smartly targeted ads for this very personal experience?

However, this is the tip of the iceberg for LiveIntent’s goals, Cooper explains. I sat down with my old Advance Digital colleague to both get a better understanding of how programmatic advertising in email works and hear how LiveIntent is leveraging the power of the email address (hashed for privacy) to realize publishers and advertisers’ identity marketing dreams. (And continue the discussion at the AdMonsters Meetup on Wed., Sept. 21. in NYC)

ROB BEELER: OK, I’m the user – I pull up my newsletter and then there’s a real-time ad call?

KEREL COOPER: Yep. We only serve an impression when you open your newsletter. Of course, in some email clients you have to download images, so we only count an impression after you open and hit “Download Images.” Then we run an auction to decide which ad to serve based on our dynamics and your data.

That could be an ad our sales team has sold directly and we’ve trafficked into our platform, or it could be from one of our DSP partners. It could be an agency or advertiser that’s licensing our platform, logging in and executing their own buys. Or it could be a publisher that’s running an audience extension campaign across our platform.

RB: What are the key differences between email display and web/mobile environments?

KC: Actually, let’s start with the similarities: LiveIntent’s platform allows publishers to use us as their display ad server of record for email inventory. We can do pretty much all the same targeting as on the web – geotargeting, audience targeting, day-parting – and probably even more models. We can do CPM, but we can also do performance-based – CPC, CPA, all that good stuff – and our platform optimizes to that.

There are many differences – because it’s in the email environment, iFrames and scripts are an issue. Most email clients strip out iFrames and Javascript, so expandable ad units or even video to some extent are either impossible or a lot more challenging.

The major differentiator, however, is the lack of cookies – in the email environment we leverage the power of the email address or, as we like to call it, the de-identified version of the email address known as the email hash. This is privacy compliant with no personally identifying information (PII), and it’s the mainstay of our targeting versus cookies on the web.

It’s our bread and butter because it gets us in the same conversation that Facebook and Twitter have around people-based marketing and building toward identity. We believe that’s the future of advertising, not necessarily targeting a pixel because of all the challenges there. We don’t need to go into that because I believe the AdMonsters community knows what they are.

RB: So that’s interesting – most people would say, “You’re doing it by email address,” but you respond, “No, no – we’re using a de-identified hash.”

KC: Just like on the web you have a cookie in your browser – and that cookie is a number not a tag that says, “This is Rob Beeler” – in the email environment we are targeting a 32-digit hexadecimal number. That’s what the hash is. Everyone’s email address has its own unique hash associated with it. We know we’re targeting 12345, and that ID has characteristics like gender, age, behaviors, interests provided to us by our advertisers and publishers, but we don’t know that it’s JoeSchmoe@gmail.com.

RB: Do we say “a hash” or “the hash”?

KC: We say both – there are multiple ways to encrypt an email address, including sha1 and sha2. The MD5 hash is the most common way of anonymizing an email address.

RB: This sounds like Facebook/Twitter-level identification – but it’s not a walled garden.

KC: No, it’s not. We are providing the platform and ecosystem for publishers and advertisers to bring their own data to the table. We’ve been around since 2009 talking about targeting in the email environment based on identity and the hash. Facebook has made it very popular with their “people-based marketing” phrasing – we thank them for that – but we’ve been in this conversation for seven years now. Now we see more and more companies talk this way.

It’s led to doors opening for us – we have 1,300 publishers that use our platform today bringing their first-party data to the table. We have more than 1,100 advertisers running across our platform plus integrations with the DSPs.

RB: Since it’s not cookie-based, how does that work for buyers who are all about programmatic?

KC: Today we have integrations with a number of the DSPs in the marketplace. Very early on it was a challenge as these DSPs were only able to see a certain percentage of our inventory because most of their desktop targeting is based on cookies. Basically we have to make a translation, so we’re deepening all of our integrations so they are based on identity. In the last few months as they’ve adopted this concept, the scale of inventory available to them has vastly improved across our platform.

RB: So people are able to programmatically buy email, but can publishers sell this as well?

KC: They certainly can in an open marketplace or a white-listed environment. We are building out PMP and DealID functionality now for release by the end of the year. We’ve been talking to a number of our publisher partners, specifically around their strategy today for setting up and selling PMPs: everything from sales to the operation piece to reporting requirements. We essentially want to make this as seamless as possible for our publisher partners, and replicate what they’re already used to.

Email inventory is typically off in left field for publishers – we’re trying to bring it into the fold so we can go to our publisher partners and say, “You can strategize and sell your email inventory programmatically just like you do on the web, and you can loop that into your packages.”

RB: That’s great, but most publishers are already using a particular ad server. Will your product still be a separate platform?

KC: The feedback from our publishers is to make this process as easy as possible on the operations and the sales piece. They already have a bunch of platforms to use and hey, look, here’s another. The challenges are around the trafficking, the reporting, the optimization, right?

So we’re working on an integration with DFP. We’ve been in beta now for a couple of months with a handful of clients, and the experience has been very educational. We’ve learned what we have done correctly with the integration while receiving comments on areas where we need to improve. We’ve learned what we need to build out now to scale and what are nice-to-haves and what will be important in the future.

The overall idea though is to enable our publisher partners to book all of their inventory – including the email piece – directly into DFP. The information loaded – advertiser name, campaign name, start date, end date, impressions, creatives – will then translate into our platform in the appropriate fields, with campaigns going live from there.

We’ve had to make it very clear that from a technical standpoint, LiveIntent is still the ad server of record because we are the only ad platform built to work efficiently and effectively in the email environment. We have to be the ad server for the email targeting and the identity piece to work. When it comes to onboarding, setting up your inventory and tags in your email templates, LiveIntent is still the platform of record while DFP is essentially the tool that pushes the information into our platform. We’re cutting out the traffickers need to toggle over and log into LiveIntent, and all the reporting flows back into DFP.

There are obviously going to be phases to the DFP integration. Phase 1 is our features and functionalities: direct-sold campaigns on your inventory, geo and other typical types of targeting, etc. But as we get deeper into this rollout, we’re going to get feedback and make iterations as we go.

RB: LiveIntent has had a unique model, but to expand you have to speak everyone else’s language – you gotta streamline. Yet you still have to be unique.

KC: That is certainly a challenge for us, but we sort of love being in that area. We think we’ve been at the forefront of identity and targeting, but we understand that we need to speak the customers’ language to get across what we’re doing and how we can help them in their business.

RB: For most pubs, advertising in email is not going to be their biggest revenue source. But this identity piece is perhaps the transformational part.

KC: Some customers that really get this – we’ve turned on that light bulb. They go back internally and ask, “How many registered users do we have on our website and our newsletters? How do we get more registration data? How do we ask questions that get us the information to do the targeting piece better, the content piece better?”



 

Rob Beeler became Publisher for AdMonsters in 2015 after serving as Vice President of Content and Media overseeing the development of content for AdMonsters events and Editor in Chief for AdMonsters.com. Rob Beeler joined AdMonsters in October 2008 after nearly 10 years at Advance Internet, a leading creator of local news and information web sites across the United States. At Advance Internet, Rob started as the only Ad Operations person and developed a department of 15 people in 8 locations across the country responsible for operations, project management, business development, web analytics and financial reporting, becoming Executive Director of Ad Operations and Analytics in early 2007.


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