Why do European agencies and advertisers need hyper-local datasets to successfully target audiences, and can concerns around online privacy hinder the use of this data? Frank Bobo, Vice President of Digital Element, spoke to Exchangewire this week about how the company’s targeting technology, NetAcuity, is helping marketers to engage the right audiences at the hyper-local level, and why user privacy is at the core of its offering.

Can you give more overview of how your NetAcuity Edge offering works?

FB: Digital Element creates a "map" of Internet topology: the way the Internet is routed, where ISP end-point networking equipment is located, etc. Using automated trace routes (akin to a search engine “spider”), we can triangulate an IP address to ISPs’ endpoint network equipment, at the neighborhood level, which generally serves a 5-25 mile radius of subscribers.

Due to the radius-served by ISP networking equipment, there have always been inherent limitations in the granularity of IP Intelligence data. A 25-mile radius can encompass a number of neighboring postcodes, for example. The exciting leap forward with our new Edge targeting product is that we have been able to combine our traditional IP Intelligence techniques with 360 degree insight gleaned from our network of commercial partners, thereby enabling us to identify down to a postcode level where an IP address resides down to about 1,000 households.

Why is a hyper-local dataset capability now so important to European marketers?

FB: Location is very important in Europe, where countries are close together and online marketers have more of a challenge addressing the cultural, language and branding differences between regions. Further, as Internet usage has matured, online marketers are demanding better accuracy with higher granularity—in other words ‘hyperlocal’ targeting—to enable better targeting of messages and the delivery of more relevant information to users.

Can you explain how your postcode level targeting is meeting this demand from advertisers?

FB: With NetAcuity Edge, online marketers, advertisers, publishers, e-tailers, etc. are now able to further segment and target their online audiences at a "hyper-local" level (targeting online to a postal-code level) based on IP addresses—which brings more reach and relevance to online endeavors.

Are you aiming NetAcuity Edge specifically at European agencies?

FB: We have been delivering IP Intelligence/geolocation information since 1999 and have seen year-over-year exponential growth in the adoption of IP Intelligence around the world. The online advertising, search marketing and web analytics industries have been at the forefront of adopting and monetizing IP Intelligence data, and this space has exhibited enormous growth in Europe over the past five years. More recently, we’ve seen strong European adoption within online video/music, social media, and eCommerce.

How does your costing model work? Do you licence your technology?

FB: We do license our technology to clients. Our pricing is based on two variables: monthly traffic and the level of data granularity requested by clients. In this way, we are able to scale pricing to meet the needs of clients of any size, from small start ups to major players within the online space.

Can you give any examples of existing European partnerships where NetAcuity Edge has significantly improved campaign performance?

FB: AdJug, the leading European online advertising exchange and an existing Digital Element customer, reported in September of last year that response levels to online adverts are more than 50 percent higher when NetAcuity® IP Intelligence and geolocation technology is used. We expect those types of results and better now that AdJug is deploying the NetAcuity Edge solution to target online content at the hyperlocal level.

Online privacy is a huge issue for EU legislators at the minute. What is Digital Element doing to safeguard user privacy?

FB: Way back in 1999, we invented IP Intelligence because we strongly believed that consumers wanted to get content that was relevant to them without having their privacy invaded. Our technology has always been, and continues to be, compliant with the highest standards of user privacy.
IP Intelligence allows ads and product offerings to be targeted much like in the real world (i.e., like customers are used to). Content can be instantly based on a user’s city/town, as well as other metrics such as connection type, company, whether a user is at home or at work, etc. Importantly, all of this is accomplished totally anonymously without any interaction with users whatsoever.

Do you think IP targeting delivers better campaign performance than behavioural targeting in smaller markets like the UK?

FB: Accurate IP targeting as a standalone solution has been independently shown to provide 30-300% increases in response rates when content is customized. Further, IP targeting is integral to behavioural targeting technologies, and as such there is a symbiotic, versus competitive, relationship with the behavioural targeting providers.

Is Digital Element looking to roll NetAcuity Edge out across other key European markets like France and Germany?

FB: We already offer highly accurate city-level targeting across all European markets. And yes, we expect to expand our hyper-local targeting capabilities on the Continent in the near future.