Company delivers targeted online ads

Called "Drive Performance Media," the initiative was created earlier this year and in recent months has been slowly gathering customers. aQuantive, formerly known as Avenue A, is expected to announce the project Monday.

The company wouldn't name specific publishers or advertising customers. But Drive's general manager, Scott Howe, said the project relies on partnerships with top-tier sites. aQuantive buys unsold ad inventory from various sites. Using visitor data from these sites in conjunction with various tracking technologies, it then profiles surfers as they jump from one site to the next. The company creates a composite of visitors' demographics, behaviors and interests, but without using identifiable data about specific people. That data is then used to tailor ads.

For example, someone repeatedly reading home-improvement material at sites like The New York Times online or About.com might see an ad for Home Depot when they visit a partner site. And because the efforts are narrowly targeted at individuals, Drive said it can sell the ad at a higher price.

"We think of it as a dating service," Howe said. "If you just know someone's name, that's not enough. But if you know which establishments they frequent, their preferences, then you make a better personality fit."

The concept has long been known as "behaviorally targeted advertising," and it is gaining traction on the Internet today through companies like Advertising.com, Revenue Science, Tacoda and aQuantive. According to the companies, they're wringing inefficiencies out of advertising and thus helping Web publishers and advertisers get more bang for their ad buck.

Behavioral targeting, however, ran into several roadblocks during the dot-com heyday, including technical limitations. For one, the same person is not always using a given computer. Failing to recognize this can distort profiles.

But privacy concerns ended up being the biggest concept-killer. Ad company DoubleClick, for example, quashed plans to track and profile consumers after the Federal Trade Commission and privacy advocates scrutinized the plans, which called for the merging of personal information from DoubleClick's catalog business with data about Web-surfing behavior from the company's ad network.

Howe said Drive will avoid privacy pitfalls by keeping consumers' personal information--such as names, phone numbers and addresses--private. "We know about their past behaviors but couldn't call them up on the phone," he said.

Similarly, ad companies Revenue Science and Tacoda are using technology to help some publishers, such as the online branches of The New York Times and The Wall Street Journal, to profile readers only while those readers are on their sites, not on rival sites.

To create the profiles, Howe said, Drive relies on software from a few sources, including aQuantive subsidiary Atlas DMT, which provides ad technology, and Digital Envoy, which provides geo-targeting technology. Drive can also use demographic data from publisher partners and purchasing behavior data from advertisers.

Howe said that the ads typically receive positive responses of 10 percent or higher, compared with responses of 0.5 percent for untargeted display ads.

aQuantive operates three units besides Drive: Atlas DMT, which produces tools for delivering Web ads; Avenue A, an ad agency that represents sales and creative efforts for publishers; and iFrontier, another ad agency, which specializes in interactive ads.