Originally Published in AdExchanger. “Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media. Today’s column is written by Jonathan Lenaghan, head of data science at PlaceIQ.
There’s been a lot of talk lately about “precision” and “accuracy” in the world of mobile marketing. But it’s becoming clear that the pressure to pinpoint high-quality mobile location data is blurring the line between what is good and bad, and realistic and unrealistic.
Here is a little context to help set the record straight.
While it’s true that the degree of precision determines the speed and relevance of mobile ad delivery, in some cases, bigger is not necessarily better. And when it comes to hyperlocal, smaller is not necessarily better, either. This means that some location points, which may sound hyperlocal in theory, can actually mislead or confuse mobile marketing clients.
Latitude And Longitude
Consider the digits or decimals to which location signals are gathered. It works like this: Latitude and longitude (lat/long) figures represent the point on a map where a location sensor is picked up. The decimal places of that lat/long figure indicate the size of the fence surrounding that data point. Two decimals equate to a 1.1 km x 1.1 km fence, or roughly two-thirds of a mile. Three decimals equate to a 100 m x 100 m tile, which is roughly the size of a city block. Four decimals zoom in to 10 meters, which is where the line is drawn between good and bad data.
While a location data company is capable of capturing five, nine or even 12 digits, that doesn’t mean it should. Five decimals hone in on a 1 m x 1 m meter space, at 8 decimals (1 mm x 1 mm) you’re looking at an ant, and when you reach 12, it’s plain ugly. Twelve decimals gets you accuracy somewhere between a micrometer and a nanometer, which has no applicability in mobile advertising. It is (almost literally) splitting hairs.
Don’t aim for these hyperlocal levels of accuracy. They are not only ludicrous from a location technology point of view, they are also computationally infeasible to execute given the latency requirements found in today’s real-time bidding environments, not to mention the lack of consumer willingness to wait for application or page loads on their mobile devices.
Think about the time it takes the GPS on your smartphone to determine your location or find your destination. If a marketer is trying to determine the location of a smartphone on the move,which has a GPS accuracy of 3 meters at best, then 10 meters or four decimal places in lat/long is as accurate as you can get.
Four decimal places is usually the sweet spot. Precise location signals can be dependably gathered at ad tech speed within 100 m x 100 m, which requires no more than four decimal places. While 100 meters may place a device in a few locations (if the area is dense), applying time of day to the tile greatly improves the precision. And for a majority of less dense areas, 100 meters produces data that is quite unique and accurate.
The Right Strategy
When trying to determine whether the money you put into a mobile ad campaign is buying good, bad or ugly data, you’ll want to make sure that the strategy being used to gather location data sensors is close enough to target devices in specific stores, rather than a shopping complex or general area.
The strategy should also be designed to accurately determine behavior trends in desired users. Underpinning the strategy should be logic that can be consistently applied across the United States.
Mobile advertising is about using best-case accuracy to serve low-latency, highly relevant marketing messages to targeted audiences. Don’t get lost in the numbers.
Our Pirate Costume Party joined together the PlaceIQ Crew with some of our favorite clients and friends at the Lightship Frying Pan last week. Our own Eric DeLange performed with his band, and many enjoyed the infamous PIQful Dead Man’s Chest cocktail. Thanks to all who donned their sea legs!
You can see more photos from the night on our Facebook page. Don’t forget to “like” us!
PlaceIQ’s Audience Series sets out to highlight the importance of segments in the advertising world. As the pioneer of mobile’s application to location intelligence, and leaders in the mobile audience field, PlaceIQ has the knowledge you need. Key audience experts from each PIQ department — from engineering, to data science, to sales — will tackle topics to give a 360-degree view on this vast, ever-changing industry. The following article ran in AdExchanger’s Data-Driven Thinking series.
By Jonathan Lenaghan
Warnings of the coming Skynet-ization of digital advertising are becoming increasingly common. But rest assured, the near-term future of our industry is not going to be filled with self-aware, artificially intelligent machines that will replace all humans currently employed at ad tech companies.
However, digital advertising does seem to be on the cusp of a significant transformation, in the form of a rapid emergence of platform-centric ecosystems. The number of ad tech companies announcing the launch of a new platform seems to grow daily. These systems will be significantly more feature-rich than the real-time bidding or large Hadoop-based back-end platforms that have defined the industry for the past several years.
To unlock real value, though, these platforms need to enable business analysts, data scientists, campaign managers and an entire host of operations personnel. Many ad tech businesses rely on ingesting, processing and analyzing hundreds of terabytes of data coming from varied and disparate sources. Traditionally, large teams of engineers toting extensive experience within the Hadoop ecosystem were necessary to get actionable insights.
The next generation of platforms will still perform these functions, but aggregations, algorithms, internal languages and interactive visualization layers will empower this larger family of end users to better define and segment audiences, optimize campaigns based upon industry-specific KPIs or slice and pivot campaign data along many new dimensions. These platforms will no longer be under the exclusive purview of data teams but will be pushed deeper into organizations to those with perhaps less technical experience in big data but with deeper domain experience.
If the focus in the past decade has been to capture and process enormous amounts of data, the next step is to design platforms that strip away this complexity and scale and seamlessly incorporate the expertise of analysts and operations personnel. The emerging platform ecosystem will augment the intelligence of analysts and enable them to effortlessly make business decisions.
The term “platform” has a tendency to evoke images of the purely algorithmic black boxes that dominate the high-frequency equity-trading world. Similarly, bidding on ad inventory will always be algorithmic with little to no direct human interaction. Targeting and serving a digital ad needs to happen in a matter of milliseconds, and so it makes sense that on the surface much of the digital advertising ecosystem is loosely modeled after equity markets.
Algorithmic black boxes, however, are really only successful when they exploit time and capacity scales with a very narrow and specific purpose, such as optimally bidding on ad inventory with sub-millisecond latencies or taking advantage of tiny price discrepancies across multiple stock exchanges. The coming era where an analyst or data scientist is going to be replaced by a black box is a long ways off.
The R Project for Statistical Computing and other statistical packages, for example, have been around for many years but as a general population, we do not seem any better at understanding statistical concepts. Even companies that specialize in black box optimization utilize teams of analysts and data scientists to identify and implement optimization strategies. Those that do not rely on human intuition and experience, I conjecture, are doing a lot of optimization towards click and impression fraud.
The Power Of Deep Domain Expertise
To be sure, I am no Luddite. I have spent my career with machines, models and algorithms, and the greatest business leverage is found by combining the analyst with the algorithm. There is a common saying among data scientists in which bigger data beats better algorithms. I posit that deep domain understanding beats both.
Given the choice between doubling my data size, spending a few months investigating more sophisticated algorithms, or incorporating the work and expertise of a knowledgeable analyst into my platform, I’ll take the human being. Rules and heuristics defined by experts have more utility and can be implemented more quickly and efficiently that building fully automated systems that learn a domain.
This model has been very successful for companies like Palantir or Quid and is the core strength of the Consumer Insights Platform that PlaceIQ is developing. The Palantir platform works “at the intersection of data, technology and human expertise” to yield actionable results for governments, as well as businesses. Quid, likewise, has built a platform to ingest large amounts of unstructured data to provide analysts with a means of interrogating complex relationships. In these platforms, data and algorithms are used to leverage human experience and intuition.
At the end of the day, the role of domain expertise will tend to outweigh both the sophistication of methodologies and access to more data. The next “Rise of the Machines” will aid analysts and managers, rather than replace them.
CRO’s Amazing Ride with PlaceIQ: Stepping Back, but Not Away!
As we start another busy week here at PlaceIQ, I have some personnel news I wanted to share. After a truly amazing stint building out and leading our sales team, Tony Nethercutt, our fearless CRO, will be stepping back from a full-time role.
At the start of Q3, Tony will shift his role to that of CRO Emeritus and continue to be an employee and advisor to the company, while becoming less involved with the day-to-day operations. He will continue to help us recruit talent and advise the sales teams, and, of course, attend our various company events – no doubt with cowbell in hand!
We were very lucky to convince Tony to join us at PlaceIQ, as he was already thinking hard about stepping back before he came aboard. As we all know, Tony has had a truly incredible, hard-charging career with companies such as Yahoo, AdMob, YouTube and others – and has achieved many of the objectives he set out to here at PlaceIQ. He has more than earned the opportunity to slow down a bit and take some time to figure out what’s next for him and his family.
In Tony’s own words:
What an amazing ride I’ve been on with you at PlaceIQ—I couldn’t have made it up if I tried. As Q3 begins, I will shift my role to that of CRO Emeritus at PlaceIQ (there is a funny story about this title…just ask me…and I will tell you). I will continue to be an employee and an advisor to the company, but less involved with the day-to-day. I’ll also continue to help recruit new sales management, regional sellers and advise our sales team (thank you, and everyone else at the company, for 5 straight quarters of exceeding goal… you done yourself proud).
I’m very grateful on so many levels for everything we’ve been able to accomplish together at this company and I plan on giving back—big time. Most who know me know that I could never bring myself to use the “R” word. So I won’t. I’ve said many times in the past that PlaceIQ would be my last stop, but it’s not the end. I’m going to continue to enjoy the best of what we’re building here (thank you Exec team for encouraging me to stay involved), my digital investments and advisory positions, have more direct charity involvement, and also take the opportunity to experience more of “life” in general.
You can all still easily reach me at email@example.com. I may need your help to break me into the next phase of my life—my wife is pretty sure that I’ll struggle without the constant email. I know that there are many more great things in the future for PlaceIQ and its people – and I’m so honored to have been a part of its growth and thankful that I will continue to be! I’ll be with you at the finish line, wherever and whenever that may be.
We are extremely fortunate to have had Tony’s talents applied here, and we are also very lucky to be in such a strong position as we grow past 115 odd people, continue to beat our revenue targets, and roll out market-defining new products. There’s never an ideal time to step back, but going out on a high note is an incredible place to be!
Remember, Tony is not going away — he will continue to be involved in the company and at our events, where I am confident that he will continue to tear up the dance floor (in pirate garb or not!) and bring his incredible energy and enthusiasm to the proceedings. Still, we will certainly see him less frequently… so I am sure you’ll all join me in ringing the cowbells long and hard and thanking Tony so much for everything he has done for us to date, and will continue to do in the future!
In advance of SXSW, PlaceIQ searched high and low for the best of the best in Austin. Here are our picks for food, drinks, and everything in between! Check out some of our favorites if you’re lucky enough to make it to Austin for this year’s festivities.