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AM: Value of user demographics, Part 2

To:     "Adv/Mktg" <ad-market@netpreneur.org>
Subject:     AM: Value of user demographics, Part 2
From:     "Andrew Forbes" <andrew.forbes@redbridge.com>
Date:     Fri, 9 Jan 1998 13:33:00 -0500

A day or two back I posted a question relating
to a business plan I'm struggling to write.  It has
become obvious that without some idea of the
context within which I asked the question that
I'm not going to get the answers I need.

At the end of this message is the concept section
of the executive summary. For those of you that
have the time/interest, I'd appreciate your
thoughts.  Please note: If you think it's a bad idea,
say so.  If you know of direct competition, please
tell me.  If you think the services offered (my
original question) have no value, tell me so.

>From a broader perspective, is my belief that
advertisers will not move to the Internet (or more
accurately, that their money will not move to the
'net) until they get the same quality and quantity
of data about Internet users that they currently
have about television viewers and radio listeners?
Do major advertisers find the survey level
data available about web site traffic (Firefly, Relevant
Knowledge, Etc) as believable as the Nielsen data
about television?  Is there value in upping the stakes
in the accuracy/auditability game for demographic
data on the 'net?  What is the value of being able
to combine the "in your face" of television
commercials with the demographic targeting
of direct mail? If it's little to nothing now do you
expect it to increase?  Does anybody care what
the online equivalents of the Audit Bureau of
Circulation has to say about a web site's visitors?

Andy Forbes

-------------------------------------------------------------

The Internet is slowly evolving from being a fad to
being a basic component of doing business.  One
place where the Internet has a lot of promise is in
getting marketing collateral in front of customers.
There are currently dozens of companies working
of marketing presentation services and systems.
>From complete Internet sites, to unsolicited email
(spam), through demographic and psychographic
ad banner targeting, the area of online advertising
is a hotbed of opportunity and investment.

There is a problem, though.  When a customer
(potential or otherwise) visits an Internet site, the
only thing that the Internet site (and therefore, the
marketing presentation system or service) knows
for sure about the visitor is their Internet Protocol
(IP) address. Also, when an Internet user (hereafter
referred to as a "surfer") sits down in front of their
computer and uses a modem to connect to the
Internet, they usually do so using an ISP.  The ISP
validates the surfer’s ID and assigns them an IP
address for that session. When the surfer
disconnects from the Internet, and later start a new
session, they will be assigned a different IP address.

So the only thing that an Internet site (and marketer)
knows about a surfer is their current IP address,
and the surfer’s IP address can change from session
to session.  Without even the most basic knowledge
of the surfers behind the IP addresses, Internet site
operators and marketers have had to resort to
increasingly intrusive and convoluted methods of
data collection.  Site registration, "cookies", and
guesstimates inferred from site activities are all being
tried in an effort to convert IP address to demographic
data about the surfers.  None of these offer the level of
accuracy and auditing available to marketers using
telemarketing or direct mail, and this lack is, in the
opinion of the principals at IPID, one of the major
impediments to the traditional advertising industry
embracing Internet based marketing.

There is a solution to this problem, and the key lies in
the statement:  "…when an Internet sits down in front
of their computer and uses a modem to connect to the
Internet, they do so using an ISP.  The ISP validates
the surfer’s ID…"  The ISP validates the surfers ID
using information they have stored in a database, and
this information usually includes information required
for billing e.g. a name, address, and a major credit
card. So the ISP knows, in an accurate and auditable
fashion, the surfer’s IP address, the surfer’s identity,
and by extension, the demographics of the surfer.

IPID proposes to act as an resale agent for this
accurate and auditable information possessed by
the ISP(s).  IPID’s goal is to be the first and dominant
company to offer complete IP address to surfer
ID/demographics conversion management as an
agent for ISPs.  IPID will manage the IP to ID sale
programs for ISPs by:

*Negotiating maximum commissions for the IP to ID
conversions
*Negotiating maximum commissions for the ID to
demographic data conversions
*Working with the ISPs to help them develop
marketing strategies to maximize their IP to ID
revenue stream
*Operating a reporting system that allows the ISPs to
effectively evaluate their IP to ID revenue strategies
*Auditing the commissions reports and checks
generated by the Internet sites and marketers that
purchase IPID services
*Working with Internet marketers to help them
maximize their revenue using IPID services



Replies
Re: AM: Value of user demographics, Part 2, Ross Stapleton-Gray

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