The Online Marketing
Ecosystem: A Data-
ABOUT THE AUTHORS
Jay Kulkarni founded Theorem in 2002
and has managed it from a four person
startup to a company with over 250
global employees and dozens of clients
sustaining hyper growth year over year.
Jay is a veteran in the online advertising
space having launched products that are
leaders in the industry today. As one of
the earliest employees at DoubleClick,
Jay headed up product management for
their advertiser solutions, taking the
DART for Advertisers product from white
board concept to over $25 million in
revenue within two years. Later, he was
responsible for the DARTmail platform
managing both organic product
development, technology integration
through two mergers and managing
teams across North America.
David Simpson is a senior member of
Theorem’s business development team
and brings extensive background in
online media and technology. Before
joining Theorem, he co-founded
PeerFinder, a business-to-business
social networking service and led
wireless and telematic strategy and
business development at Audible. At
Verizon, Simpson was instrumental in
creating the enterprise business
e-commerce strategy, launching Internet
services and developing interactive
media applications for enterprise
business customers.
Copyright 2007, Theorem Inc.
Centric Perspective
By Jay Kulkarni and David Simpson
As marketers seek greater understanding of their
customers and campaigns, their task has become
increasingly complex, in no small part by the sheer
volume of data created by online marketing
technologies. The highly fluid nature of consumer
markets coupled with aggressive corporate goals to
grow market share and revenue have created the need
for increased frequency of analysis and ongoing custom
analysis on a brand and campaign basis. Digital
marketers need a holistic approach to analysis that is
supported by a team of skilled strategists and tacticians
which leverages a flexible media analysis platform.
Online Marketing: A Growing Challenge &
Opportunity
The amount of innovation we’ve experienced since the
introduction and proliferation of the web browser is
staggering and certainly worthy of volumes, which will not be
covered here. But, with the frenzied growth of the Internet
has come an opportunity and a burden for marketers in
every corner of the environment – from search engines to
online publishers to advertisers and agencies – to be more
effective through better use of the torrent of data that each
click creates in aggregate.
The Growth of Online Marketing
Though not currently a large portion of ad spending for the
top US brands (about $10B out of a total $150B), Internet
advertising is growing at the fastest rate (up 17.3%) while ad
spending in other forms of media is shrinking1. The July 25,
2007 issue of Advertising Age™ magazine reported that,
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 regarding ad spending, “…for the 100 LNA [Leading National
Advertiser] companies, according to Ad Age DataCenter
analysis of TNS Media Intelligence data…the internet [in
2006] drew 5.5% of measured spending…up from just 0.8%
2000.” On the other hand, TV, “…the top medium for leading
advertisers [in 2006] accounted for 59% of U.S. measured
spending in consumer media…down from about 64% in
2000.” Internet advertising is ahead of outdoor advertising
(2.6%) and is closing in on radio advertising (7.4%).

Beyond what might be termed, “traditional Internet

advertising” (email advertising, banner and flash advertising,
search engine marketing, etc.), as the Internet grows in
complexity, familiarity and intimacy for consumers,
businesses are experimenting with promoting their brand,
their products and their services by leveraging other facets of
the medium. Examples include posting (or inviting the public
to post “user generated”) video clips on general access sites
like YouTube™2 or creating virtual storefronts, products or
services in cyber-worlds like Second Life 3.

The Online Marketing Ecosystem

Though certainly worthy of a separate thesis, it’s important
for our purposes to have a feel for some of the “moving
parts” within the online marketing and advertising “machine”.

Like traditional media, in this ecosystem there are

advertisers, their agencies, their customers or prospects and
the media. The on-line ecosystem has also spawned a
number of new players but, in general, all fall into one of
three functional areas: buyers of media, sellers of media and
media enablers. Some are interdependent, some are
competitive and some play both roles simultaneously.

Though not explicitly described, all of those “moving parts”

create “friction” and therefore complexities that have
necessitated the emergence of intermediaries to help reduce
cost and turnaround times and improve quality and
efficiency.

What follows is a condensed summary of key contributors to

the online marketing ecosystem and the roles and
representative players. Also provided is a graphic illustration
of how some of the more significant players in the
ecosystem interrelate.
1 Advertising Age, July 25, 2007
2 Red Bull, H&R Block
3
H&R Block

Copyright 2007, Theorem Inc. 2. WWW.THEOREMINC.NET

 The Online Marketing Ecosystem

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ROLE FUNCTION PLAYERS
Ad serving describes the technology and service that places ads DoubleClick (DART),
on web sites. Ad serving technology companies provide software Atlas DMT,
Ad Servers to sites and advertisers to serve ads, count them, choose the ads Mediaplex,
that will make the site or advertiser the most money, and monitor RealMedia
progress of different advertising campaigns.

Search advertisements are targeted to match keywords entered

on search engines. The opportunity to present consumers with Google, Yahoo!
Search Engines advertisements tailored to their immediate buying interests MSN, Kanoodle,
encourages consumers to click on search ads instead of unpaid Ask!
search results, which are often less relevant.

Search Engine Marketing, or SEM, is a form of Internet Marketing

that seeks to promote websites by increasing their visibility in the Performics,
Search Engine Search Engine results pages (SERPs). According to the Search Did-it,
Marketers/ Agencies Engine Marketing Professionals Organization, SEM methods The Search Agency
include: Search Engine Optimization (or SEO), paid placement,
and paid inclusion.

Advertising network refers to an intermediary, which serves

Advertising between a group (network) of web sites (which want to host Advertising.com
Networks advertisements) and advertisers which want to run advertisements Tribal Fusion
on those sites.

Affiliate marketing is a method of promoting web businesses

Affiliate (merchants/advertisers) in which an affiliate (publisher) is rewarded Commission Junction
Marketers for every visitor, subscriber, customer, and/or sale provided through Linkshare
his/her efforts.

Content sites work on the fundamental of generating [advertising ESPN, CNN,

Online
or subscription] revenue [or both] through the content they have on Weather.com,
Publishers their web site. YouTube, MySpace

An advertising agency or ad agency is a service business Digitas, Starcom,

Ad Agencies dedicated to creating, planning and handling advertising (and other Saatchi & Saatchi
forms of promotion) for its clients. Avenue A, Razorfish

Email marketing is a form of direct marketing which uses electronic Epsilon Interactive,
Email mail as a means of communicating commercial or fundraising CheetahMail,
Marketers messages to an audience. SilverPOP

Rich Media Rich Media technology utilizes a combination of text, audio, still
Motiff/Klipmart,
Technology images, animation, and video to provide the user with a more
Pointroll, Eyeblaster
Providers dynamic and interactive advertising experience.

eCommerce eCommerce monitoring providers offer web analytics solutions for Omniture/Visual
Monitoring internet channel monitoring. Sciences,
Providers Coremetrics

4
Wikipedia, The Free Encyclopedia

Copyright 2007, Theorem Inc. 3. WWW.THEOREMINC.NET

 The Online Data
Each service provider in the online marketing ecosystem
collects and shares performance data with the advertising
agencies and the advertisers at a level of detail and
frequency that, in the past, was simply not available.
Examples include ad server data, search engine data, email
marketing data and rich media data. Other online data
available to the marketer includes enterprise or destination
web site data 5.
Marketing data in the online domain can be divided into two
major categories:
- Summarized Data: This data tends to be smaller in size
and captures key elements of campaigns, not every detail.
This data is easier to work with than raw data.
The Facilitators - Raw Data: This data captures many details about
In the online domain, there are three campaigns and is much larger in size than summarized data.
distinct, though disparate factions that
aid in connecting the buyer (customer) Growing in importance, rich media (interactive multimedia)
and the seller (advertiser). data provides information regarding people’s activity when
viewing a rich media advertisement. Rich media can include
audio, video and animation in addition to traditional text and
Seller/Advertiser graphics and - because rich media is so much more
interactive than traditional media – it offers greater
data-gathering and data measurement opportunities. This
data can include how long the user was interacting with the
advertisement, whether the advertisement was expanded or
Media Media Media
Buyers Sellers Enablers
not, how much of the advertisement they saw, video view
time, and so on 6.
Advertiser Affiliate Ad Network As mentioned previously, companies that are utilizing social
Marketer online marketing technologies to enhance their brands and
Ad Agency
Destination/
Ad Server grow revenues also receive data from these service
Search Publisher Email
providers 7.
Engine Marketer
Marketer Search Getting data all under one roof and using it to improve ROI
Engine Rich Media (return on investment) is a growing challenge in online
Technology media. It should also be noted that – in general - each of the
Provider data file formats from the myriad of online marketing and
advertising platforms is unique. For instance, data can be
eCommerce
Monitoring tabulated by commas, tabs or pipes. Bringing this data into a
Provider single database or analytics tool where it can be managed is
a topic we’ll address later in this article.

5
Data may be available through solutions provided by companies such as Web Side
Story, Web Trends, Omniture and Coremetrics.
Buyer/Customer 6 Rich media measurement tools are provided by companies such as Klipmart,
TangoZebra, PointRoll and DART Motif.
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Examples include data from YouTube, SecondLife, blog sites and podcasting sites.

Copyright 2007, Theorem Inc. 4. WWW.THEOREMINC.NET

 A Holistic View: The Other Data
With the advent of the Internet, consumer buying behaviors have radically changed and will continue
to change in a dynamic fashion for the foreseeable future. For instance, a television ad may drive a
consumer to conduct an online search for specific or generic product information, visit one or more
brand or affiliate web sites, purchase online directly from the retailer or from a reseller, or print a
coupon and purchase from a company-owned store or an authorized dealer. Internet behaviors and
“real world” behaviors require analysis in a “multi-channel” or holistic way.

Along with the various online data sources that have been described so far, marketers may be
required to compare and manipulate the following:

- Market research data from companies such as

MillwardBrown, Nielsen/NetRatings and comScore
- Media buying data from Donvan Data Systems
- Telemarketer and call center data
- Audit services data
- Demographic data
- Credit score data from Experian and Acxiom Financial Group
- House lists and existing client lists

What follows is a representative sampling of the data available to the marketer from both online and
traditional sources:

AD SERVER DATA
Dimensions of Interest Measures of Interest
Site Placement Impressions Ad Interaction Rate
Creative Ad Description Clicks Interaction Time
Creative Size Advertiser Conversions Ad Component Interactions
Creative Type Activity Type Revenue Video Play Rate
Date Activity Sub Type Unique Impressions Average Video View Time
Week End Date Postclick Tag Unique Clicks Video Completions
Month Postclick Tag 2 Unique Conversions Replay Rate
Quarter Pricing Model Click through rate Reach
Day of Week Geography Click to conversion rate Frequency
Frequency by day Time Spent Impression to conversion rate Frequency vs. Response
Campaign Postclick Tag Revenue per Sale Frequency vs. Conversion
Campaign Begin Date Postclick Tag 2 Revenue per User Time Lag to Conversion
Campaign End Date Revenue per Impression Ad Delivery Rate
Status Revenue per Click Attrition Rate
Category Revenue per Visit ROI
Sub Category Ad Exposure Time

Copyright 2007, Theorem Inc. 5. WWW.THEOREMINC.NET

 SEARCH ENGINE DATA
Dimensions of Interest Measures of Interest

Engine Engine vs. Content Site Impressions Total Cost

Click Date Pricing Model Clicks Cost per Conversion
Keyword Geography Conversions Margin
Keyword Bucket Keyword Value Average Position ROI
Conversion Date Position CPC

BACK END DATA

Dimensions of Interest Measures of Interest

Traffic Source Attrition Rate Delivery Rate

Pages Visited / Click Stream Cost per Visit Open Rate
Average Page Views Conversions Clicks
First Time vs. Repeat Cost Per Conversion Click Rate
Geography Browse to Buy Ratio Soft Bounce Backs
Registration Data View to Cart Ratio Hard Bounce Backs
Time Spent on Site Subscribes
Categories of Interest Unsubscribes
Email Pass Along Rate

ATTITUDINAL SURVEY DATA

Dimensions of Interest Measures of Interest

Demographics Creative Aided Awareness Usage Volume

Psychographics Creative Size Unaided Awareness Recommendation Intent
Brand Consumption Creative Type Ad Recall Product Satisfaction
Category Consumption First Time vs. Repeat Message Association Marketing Resonation
Channel Geography Brand Favorability Viral Activity
Category Purchase Intent Referral Impact
Site Brand Attributes Motivation for Visitation

Copyright 2007, Theorem Inc. 6. WWW.THEOREMINC.NET

 SYNDICATED AUDIENCE MEASUREMENT DATA
Dimensions of Interest Dimensions of Measure

Demographics Unique Audience Session Visits

Psychographics Reach Time Spent
Category Duplication of Reach Page Views
Sub Category Access Location Time of Day Access
Site Audience Composition Day of Week Access
Home/Work Access

“We know that half of our advertising works. We just don't know which half.”
It’s a quaint old expression. Traditional media – print, radio, television, direct mail and outdoor – offers
virtually no linkage between the exposure and the purchasing behavior. Online media not only offers a
record of events that have occurred, it also offers a “bread crumb trail” of behaviors that allows
marketers to precisely quantify cause and effect - what’s working and what’s not – and the opportunity
to optimize in real or near-real-time - “The Holy Grail of online marketing.”

Managing the Online Data: “Apples and Oranges”

A new challenge to advertisers and agencies in the online domain is making the "apples and oranges"
of online marketing data, as well as data from traditional media campaigns, more usable together.
Agencies and advertisers have empowered their marketing analysis teams to seek deeper marketing
and business insight and to recommend action based on data from across the online and traditional
media outlets. However, platforms built for analysis of traditional marketing data are not inherently
suited for the volume and complexity of data generated in the online domain. Also, the data intake and
cleansing process - including data aggregation, merging and QA from disparate data sources - is still
difficult, time consuming and costly. Generally, these tasks are neither fulfilling to nor a cost effective
use of strategy-focused managers.

The Holistic Media Analysis Platform

Is there a “Holy Grail” of online marketing data analysis? Is there added value in a platform capable of
allowing marketers grounded in the traditional media – radio, TV, print – to perform integrated analysis
across traditional and online media? It’s a business problem worth investigating and an engineering
challenge worth getting right.

(See sidebar, “Holistic Media Analysis Case Study: Online Travel”)

Copyright 2007, Theorem Inc. 7. WWW.THEOREMINC.NET


Holistic Media Analysis
Case Study: Online Travel
Holistic media analysis platforms exist or
are being developed within the
marketing and advertising ecosystem,
driven by insights gathered in both the
traditional and the Internet domains and
by market demand for robust tools to
address complicated marketing
questions.
One large online travel company, eager
to improve internal efficiencies, elected
to move as much ad hoc analysis to an
automated daily analysis and reporting
system as practical. On a daily basis,
internal analysts were responsible for
importing five log files, one impression
file, one clicks file, three activities files
and ten match tables. Their process
included manual data aggregation and
cleansing and then applying weights to
various categories.
Using a Holistic Media Analysis
Platform, the company was able to apply
their business logic, summarization and
equations, condense 3GB of raw log file
data to 10MB of summarized data on a
daily basis and automatically generate
campaign/site analysis, click-through
analysis, click conversion analysis,
conversions by time of day, click to
conversion time lag and unique reach
and frequency.
The team’s ad hoc analysis has been
transformed to an automated delivery
system, reports are accessed online
from multiple geographies, analysis and
report generation went from four weeks
to automated overnight delivery and
reduced the cost of analysis and report
generation for the company by 50%+
over a yearly basis.
Copyright 2007, Theorem Inc.
Characteristics of a Holistic Media Analysis
Solution
Thus far, we’ve shown that online advertising activity is
growing rapidly, that online advertising platforms generate
data at rates unprecedented in advertising circles only ten
years ago, that traditional and online advertising data – taken
together – can yield insights into new and evolving consumer
buying behaviors and that managing the “apples and
oranges” of online and traditional data is a difficult – if not
painful – task for the enterprise to execute on.
At the very least, a holistic media analysis platform is
necessary to help make the challenge marketers face a more
manageable task. Such a solution should be a repository for
all online advertising data and support straight-forward
incorporation of other types of client-provided or syndicated
data.
Besides supporting strategic and tactical initiatives, a holistic
media analysis platform should be easy to acquire, learn and
use, cost effective to “own and operate”, easy to upgrade,
and straight-forward in its support of teams both internally
and across corporate boundaries.
What follows is a “shopping list” of functional and business
attributes that are ideally found in a holistic media analysis
platform.
Functional Requirements
Intake of Data
- Robust infrastructure to consolidate raw data sources into a
common data repository
- Database agnostic and compatible with popular database
formats such as Microsoft SQL, Oracle and mySQL
- Automatic data downloads through APIs
- Manual input of data when automation is not possible
- Flexible data architecture to incorporate new datasets,
measures and dimensions
- For exception handling, provides access to/by data analyst
teams and tools to streamline the data handling, staging,
and preparation
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 Storage of Data
- Robust archiving that supports flexibly storing data by
different time periods
Manipulation of Data
- Automation for data preparation, data cleansing, de-duping
and normalization
Output of Results
- Automatic and standardized reporting and analysis across
client campaigns and geographies
- Multi-client, multi-media and multi-channel analysis using
both on-line and direct-marketing campaign data

- Generation of frequently used metrics 8 delivered

“out-of-the-box” and broken down by:
- Clients
- Campaigns
- Sites
- Brands
- Creative Types
- Delivery of reports and analysis such as
- High-level executive reporting (i.e. dashboards)
- User-defined, produced and delivered graphs and
charts
- Automatically generated and distributed reports to
pre-defined users and clients
- User-defined basic reports with the ability to drill up
and drill down
- Ability to export all reports in common
output/presentation formats such as MS Excel™,
HTML and PDF
- Ability to export subsets of filtered data through
robust integration with popular database formats
including MS Excel™ and MS Access™
- Integration to industry-standard statistical analysis
tools such as SAS™ and SPSS™

Business Requirements
Ease of use
- Easy to-use, flexible, web-based interface

8
Refer to chart, “Online and Traditional Data Available to the Marketer”, for more detail on
the types of marketing metrics you will encounter.

Copyright 2007, Theorem Inc. 9. WWW.THEOREMINC.NET


ABOUT THEOREM
Theorem is a pioneer and leader in
offering specialized technical and
analytical services to the digital
marketer. Unlike many generic
outsourced service providers, Theorem
was founded in 2002 with the vision of
being a domain expert in the online
marketing space and delivering world
class service. Theorem powers ad
operations, search operations and
analytics for some of the most
sophisticated marketers in the world.
Driven by the mantra of delivering
outstanding value for our customers and
creating an enriching workplace for our
global employee base, Theorem is
positioned for another 5 years of rapid
fire growth in this new marketing
medium.
Theorem Inc., is a privately held
company with offices in New Jersey,
India, and London. Using multiple
operational centers in India, Theorem
supports customers in Europe and
America on a 24/7 basis.
To Contact Theorem:
Theorem Headquarters
383 Main Street, Suite 202
Chatham, NJ 07928
Main: 973-665-1700
Fax: 973-665-0370
email: info@theoreminc.net
Copyright 2007, Theorem Inc.
Access that addresses the needs of the enterprise
- Cross-client and cross campaign views of media
- Permission levels for different teams, including different
partners and team members
- Transparent access across multiple offices and
geographies
Cost of ownership
- Reasonable total cost of ownership with minimal
maintenance by the IT organization
- Offered as Software as a Service (SAAS), which provides a
zero footprint, web access to data and reports
Robustness
- Statistical analysis and algorithms that can easily be reused
across campaigns, products, brands and so on
Disaster Recovery
- Redundancy provided in the event of loss of primary
access or facilities
A Moving Target
As we stated at the beginning of this article, change is the
only constant in the disciplines of advertising and marketing
and, with the growth of Internet marketing, the drive to make
better marketing and advertising decisions with the torrent of
data available is creating both overwhelming pressures and
unprecedented opportunities. A media analysis platform that
is holistic in its view of marketing, non-invasive in terms of its
operational requirements, cost effective to acquire and easy
to use by individuals and teams will form the foundation of an
enterprise-grade tool. The organizations that create, sell and
provide services for the users of these platforms must be also
embody the traits of the technology itself and serve as a
beacon, anticipating and adapting their solutions to the
needs, challenges and opportunities offered by the
marketplace.
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