This post will compare between two sorts of revenue generation models.

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Last year, Facebook introduced a new advertising proposition for its users base called “Beacon“. It had its own creepiness which turned most users off. Basically the ads were being targeted at the members using their profile data pertaining to demographics in three parts (according to TechCrunch).

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Now its MySpace’s turn. it’s called Hypertargeting. The idea is simple: Use the information contained in social network profiles to do a better job of matching ads to people. MySpace started small, analyzing its overall population to identify enthusiasts for certain categories of products — movie-goers, for example. Hypertargeting takes those categories and gathers more profile-based data: Movie-goers can be tagged as science fiction fans, for instance.

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And now this is what MySpace had to say:

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Hypertargeting – Its a new advertising solution that enables online marketers to tap into self-expressed user information to target campaigns like never before.

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How it works – It leverages self expressed interests & passions of millions & millions of MySpace members – allowing to reach the consumers most likely to be receptive to the specific brand.

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Now where’s the catch to all this. Immediately 3 things comes to the mind:

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1. Why should the advertisers pay for Hypertargeting ads when they can do so with search ads since its highly targeted.

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2. For this sort of campaigns to be successful, you need to have surplus ad inventory since no two people are similar in the taste & preference. So that puts a doubt about MySpace’s Hypertargeting?

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3. How can MySpace assure advertisers that this sort of advertising will generate enough conversion ratio?

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Infact, Behavioral targeting seems to have a better value proposition if you’re trying to sell something. It allows you to target your right set of customers with right set of ads.

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Again, it’s not a question of whether Hypertargeting works or not but whether it works better than the alternatives that advertisers have for their budgets.

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To end it, I won’t say that Hypertargeting will die or lose out in the crowd. Infact, once people are aware about it, it might as well work for them. But to look at the alternatives, we can have something like profile based advertising which can act as one factor in the gamut of many such personalized advertising techniques. So feeding users with host of such profile based advertising instead of stand-alone Hypertargeting can be the future of online advertising.

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