Jupiter Research Study on Behavioral Targeting in Advertising

Behavioral Targeting &

The Purchase Funnel Opportunity

Prepared for:

Revenue Science

by JupiterResearch

Key Questions

• What type of advertising drives interest and action? To what extent are online consumers receptive to different advertising strategies?

• How large is the BT receptive audience and how can this group becharacterized – in particular what is this group’s propensity to shop online?

• How does the Internet fit into daily shopper activities? How are users leveraging different tools (as a compliment or outside of Search?)

• How does the Internet fit into the shopping process? And how does the shopping process vary by product category?

• To what extent is there an opportunity to reach online shoppers through behavioral targeting?

Methodology*

• AOL and Revenue Science commissioned JupiterResearch to conduct an independent unbiased study to address the study key questions.

• This effort leveraged an online consumer survey –developed by JupiterResearch – for the primary research effort.

• Online survey specifications:

• Timeframe: April 2007.

• Number of respondents: 2035 representative of the online consumer population.

• Number of questions: 25.

*Note: This is an abbreviated methodology; the full version is available upon request

Online Advertising And

Behavioral Targeting Study Highlights

93% of the BT receptive audience

shops online!

Key Findings

� More consumers are consistently more receptive to

behaviorally targeted ads than to contextual advertising. In

fact, behavioral outperformed contextual by as much as 22

percent.

� Consumers who prefer BT ads represent a higher value

audience making them a more attractive online advertising

target

� Represent a higher income bracket

� Spend more money online

� Shop online more frequently

Moving Forward

� Online shoppers are a moving target but the opportunity

is there to provide a relevant experience and win their attention by:

� Providing ads related to considered purchases during their daily

activities

� Leveraging the general online activities and habits of online shoppers

� Taking advantage of the multiple steps of the purchase funnel where

online shoppers leverage the Internet for more than just purchasing

online – also for researching their purchases (whether the purchase

execution is online or offline)

Two-Thirds Of Online Users Have Acted

As A Result Of Viewing Online Ads

34%

7%

8%

12%

14%

17%

17%

21%

27%

32%

33%

0% 20% 40% 60% 80% 100%

None of the above

Called toll-free to order

Forwarded ad to a friend

Told a friend about ad/product

Purchased in a physical store

Played a game online

Registered with site for coupon/discount

Purchased product/service online

Used search to find out more about

product/service

Visited Web site related to ad

Entered a sweepstakes

66% of

Online Users

Percentage of Online Users

Source: AOL/Revenue Science/JupiterResearch Consumer Survey (04/07)

Behavioral Ads More Likely To Receive

Attention Than Contextual Ads Overall

49%

63%

0% 20% 40% 60% 80% 100%

Contextual Ads

Behavioral Ads


Represents Top 2 Box Scores: Strongly Agree, Agree


More Online Shoppers of All Types Are More

Receptive To BT Ads

20%

50%

72%

36%

65%

78%

0% 20% 40% 60% 80% 100%

Non-Shoppers

Infrequent Shoppers

Frequent Shoppers

Percentage Of Online Users

Behavioral Receptive

Contextual Receptive

Represents Top 2 Box Scores: Strongly Agree, Agree


Online Shopping And

The Purchase Funnel

Progress Of The Purchase Funnel

Decision Stages

CompareInspire/Initiate Execute

Check

price,

features,

etc.See

what’s

available

Narrow

down

choices

Find a specific store or site Make

purchase

Review general product info


Online Shoppers Large Percentage Of The

Online Population

12%

7%

18%

64%

0% 20% 40% 60% 80% 100%

Neither researched nor

purchased

Purchased not researched

Researched not purchased

Researched and

purchased

88% have

shopped online



Online Shoppers Visit Several Sites In A

Typical Day


48% visited more than 5

sites in one day

2%

6%

4%

11%

27%

50%

0% 20% 40% 60% 80% 100%

E-mail or IM only

21 or more

16 to 20

11 to 15

6 to 10

1 to 5


Half Of Online Shoppers Shop Online At

Least Once Per Month

2%

5%

5%

13%

26%

50%

0% 20% 40% 60% 80% 100%

Every day

More than once a week

Once a week

Every other week

Once a month

Less than once per month

Percentage of Online Shoppers


Online Purchase Research Activity

5%

1%

1%

1%

6%

10%

14%

29%

33%

0% 20% 40% 60% 80% 100%

More than 12 weeks

9 to 12 weeks

7 to 8 weeks

5 to 6 weeks

3 to 4 weeks

1 to 2 weeks

4 to 7 days

1 to 3 days

Less than one day

38% reported

the purchase

process lasted

at least 4 days

Percentage of Online Shoppers


Limited Opportunity to Connect With Online Researchers

10%

2%

8%

23%

29%

28%

0% 20% 40% 60% 80% 100%

More than five times

Five times

Four times

Three times

Twice

Once

Percentage of Online Researchers


Behavioral Ads/Promotions More Likely

To Be Noticed By Category Purchase Intenders

57%

57%

61%

68%

59%

59%

69%

77%

74%

76%

79%

73%

77%

79%

0% 20% 40% 60% 80% 100%

Telecommunications

Computing products

Consumer electronics

Health products

Travel

Auto

Financial services



Percentage of BT and CT Receptive Segments


Behavioral Ads/Promotions More Likely

To Be Noticed By Category Purchase Intenders

51%

55%

61%

55%

58%

62%

56%

73%

73%

75%

71%

71%

78%

72%

0% 20% 40% 60% 80% 100%

Government services

Education services

Fashion/ style

products

CPG

Pharmaceuticals

Classifieds

Entertainment



Percentage of BT and CT Receptive Segments


More Information

Marla Schimke

[email protected]

Jupiter Research Study on Behavioral Targeting in Advertising

Automotive

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