Unintrusive Personalized Ads in MADTech & it's Effects on User Experience

Our capitalistic society is geared towards providing consumers with products that not only have to work but demand a satisfying experience. Furthermore, the user market is saturated with millions of products that attempt to grab our attention and claim to be the perfect fit for users. When dealing with the digital space it can be a difficult task for users and sellers to connect properly. How do businesses avoid poor user experiences with their products while maintaining comfort for consumers? How do businesses market to consumers without being over-intrusive? And is there a way to market to a consumer without neglecting thier privacy in the marketing life cycle? Solutions to these answers tend to be the job of MADTech companies such as 4D Sight, Instreamatic, and VideoAMP. These companies cater to businesses that provide products and services geared to building great relationships with their consumer base via video and audio content. Even before the consumer touches a product, these MADTech companies provide advanced marketing and advertising techniques by means of unintrusive ads that could potentially benefit consumers if used correctly.

MADTech, what is it? How does it work? And why is this important? MADTech is a phase coined back in 2015 by David Raab to represent the convergence of marketing and advertising technology. At the moment, Advertising Tech and Marketing Tech are being used together to personalize End User’s digital marketing and advertising experiences across the Internet. Applications, social media, and television are some of the funnels leveraged to engage with users. To define an End User in this capacity, an End User is a user accessing the Internet with an E-mail. This area of tech becomes important moving forward as the Internet is also moving beyond the use of third-party cookies, a user’s digital info left behind and shared by big businesses for gathering user data. This is due to End Users wanting to maximize their privacy while engaging with new products comfortably. How is this possible? Machine learning and AI (Artificial Intelligence).

Obtaining user information tends to be the key to narrowing the gap between consumers and product sellers. Hick’s Law tells us that the more choices we have in front of a user the longer said user will take to reach a decision.¹ This user experience law pertains to the marketing world heavily and drives marketers and businesses to narrow down product choices quickly for users. Isolating products and services for users is critical in order for users to have experiences that are intended. Giving too many choices will always negatively impact products and services due to users not providing proper attention required for intended experiences. AI and machine learning enter the picture by not only narrowing down products but also improving the experience when users first engage with them. Products provided by Video AMP within the MADTech space use AI to gather large amounts of user data to market and advertise suitable products geared toward specific user markets in a matter of nanoseconds for businesses to reach consumers searching through video and audio platforms. Then begins the End User’s product or service experience in a world driven by bidding and negotiation all within nanoseconds of them viewing ads on video and audio platforms on the Internet.

To help explain how MADTech is currently engaging users with new products, three platforms will be used as an examples: Youtube, Twitch, and Pandora. Youtube and Twitch allow users to share, create, and interact with other users through video or streaming activities. Videos and streams can range from informative, gaming or podcasts, to music, food, etc. Pandora is a platform generally used for music and podcasts. Typically the monetization method found in these three spaces users encounter intrusive ads. Intrusive ads disrupt a user’s experience and can come in many forms such as banner ads, auto-playing videos, and automatic audio-playing advertisements. Many of these ads tend to be placed where the user no longer has a need or want for the products being advertised to them. As an example, watching a video on home improvement, and then getting an ad in the middle of the video about healthcare. The content being watched doesn’t match the advertisement regardless of a search history for healthcare. The effect, the user experience is interrupted which creates resentment before a product’s ad begins.

Ads can be beneficial to platforms such as Youtube and Twitch by generating revenue, but what are the caveats? Currently, about 75% of users believe ads are necessary and about 70% of users tend to be ok with advertisements if the content is free to view.² Yet, 57% of users on the Internet disapprove of prestitial video ads or auto-playing ads.³ Youtube, Twitch and Pandora rely on ads to keep their platforms free to users and the more a user uses the platform the more likely they are to be advertised to. In other words, these platforms want user retention as high as possible to maintain revenue. The problem occurs when users stop using these platforms due to too much advertising. In 2014, a study on Pandora found that the more ads a user experienced, a decrease of 2.8% hours weekly spent engaging with the platform.⁴ In other words if a platform over-advertises to users long enough, engagement with the product will end. This is bad for the product being advertised and the platform that is advertising because people remember uncompleted or interrupted tasks better than completed tasks, also known as the Zeigarnik Effect.⁵ People tend to remember a bad experience more than a good one. In this case, disruption of a user’s music or video experience affects the user negatively if over advertised to. Going forward, MADTech with a bit of strategy can do a better job at balancing the user experience, profit, and user population.

Reaching new customers can be difficult in the marketing world since users tend not to like forced advertising, which interrupts pleasant experiences. 4D Sight is an AI-powered marketing tool currently being used to live advertise to users on streaming & video platforms. This service avoids poor user experiences with products and brands while maintaining comfort for consumers. Imagine watching a football match on your mobile device at a local bar and the logo in the middle of the field is for AT&T, but you happen to look over and see another person watching the same game on their device. The logo for the other person in the middle of the field is for Pepsi. How is that possible? Then after halftime, the logo in the middle of the field is completely different. Your logo is now for Dollar Shave Club and the other user’s logo is for Coors Light. This is an example of how unintrusive ads are benefiting both the user and the video streaming platform. The user gets to enjoy the game and the streaming service benefits from the advertising. Other uses for this involve E-sports, influencer streams, and live podcasts on Youtube and Twitch. Users typically understand that advertisements are necessary for free platforms to exist,² but the more MADTech companies reduce their efforts to disrupt the viewers experience, the more likely advertising is to be effective. This kind of advertising can be put almost anywhere there is a screen and increases the reach a product and brand can have without creating an ill experience for new users.

^{4D Sight Video Game Ad Demo}

Consumer retention is another step in the marketing life cycle that needs to be addressed when trying to get customers to return. Reducing the steps a user has to take when returning to a product is key when engaging with a user who needs the process to go faster. Also, giving users the freedom to engage on their terms is a huge plus for user experience and long-term engagement. Services provided by Instreamatic, through AI-powered conversations, allow users to engage with products without even opening their phones. Users like to re-engage with products when it is convenient for them. Imagine a user listening to a podcast and they are prompted by an AI voice for the ad break that allows them to place an order without even opening their phone. “Good Morning, John. Have you had a cup of coffee this morning? Would you like to place your usual order with Starbucks and have it ready for you before work?” If John says “Yes”, John will not only skip the line but also the hassle of even opening the app on his phone. Quick, simple, and easy. This creates a user experience that allows flexibility. If John answered, “No, maybe tomorrow.” John will be asked the next day if an ad is prompted on his device. This voice-driven AI allows marketers to engage with consumers directly. Now imagine when consumers ask if there is a product that can solve their problems as they become more accustomed to this type of technology.

Video & audio content is a powerful way to market to new potential users. How MADTech companies engage with users online is becoming increasingly important, especially with younger demographics. At the moment, video content is being used by over 3 billion people worldwide. 90% of consumers use their mobile devices to watch video content.⁶ In a single month in 2021 about 70% of users worldwide 16 and up consumed audio content.⁶ Due to large portions of the population engaging with video and audio content, it’s the responsibility of MADTech companies to make ads not only user-friendly but also memorable. The average person can only keep 7 (plus or minus 2) items in their working memory, also known as Miller’s Law.⁷ This tells us the user experience with the monetization of ads needs to help users engage with the content of their choosing effectively if brands and businesses wish to exist long term in the minds of users.

MADTech companies are slowly tackling the challenge of incorporating user empathy into their solutions on how to market to users safely without disrupting their viewing experience. Video viewing platforms are only going to become more prevalent in the digital space as businesses discover the retention rate that streaming and video has. Facebook, Tik Tok, and Instagram are only a select few that capture large audiences with video and streaming. At the moment, quick advertisement breaks between videos and streams are the way these platforms advertise to users. As monetization of videos and streams adapt to users, there comes a moral responsibility to balance how much advertising is to be incorporated into users viewing experiences and when to give the user the freedom to not be advertised to. While we have the capabilities to always advertise to users, MADTech companies need to know when not to show products and services to users. This may maximize advertising efforts going forward. Advertising at certain moments in time can maximize a users engagements with products. Sometimes the most impactful moments can be the moments where nothing is happening.