Monday, July 25, 2005

Yahoo, data mining, and advertising

Fred Vogelstein at Fortune writes about "Yahoo's Brilliant Advertising Solution".

Here's an excerpt on data mining for Yahoo's targeted advertising:
[Yahoo] can also predict the probable response rate to the ads on each segment of the portal. It can predict what time of day the ads are likely to be most effective.

And increasingly, by analyzing "click streams" on its network, Yahoo can spot potential buyers at various stages of the consideration process.

In other words, by looking at the billions of user clicks that flow through its servers every day, Yahoo is getting better and better at figuring out that a given pattern -- say, a user who's looked up football on Yahoo Sports, checked out adventure movies on Yahoo Entertainment, and compared truck prices on Yahoo Autos -- means the browser is interested in buying a Jeep and is just beginning to think about a purchase.
Advertising is information, information about products and services you don't know about and might want. Advertising should be relevant, useful, and interesting. Targeting, personalized advertising wastes less of your time and focuses you in on the information you need.

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