Field Notes Inside an Integrated Communications Agency

So I was thinking about the RAND corporation this weekend and how they used marketing back in the day, given the work they did. I don't know, I was just curious. I looked it up in Wikipedia. It was immediately after my son went to sleep at about 9:00. Then I stumbled on game theory. When I looked up, it was 4:00 am and I was writing about what I believe is the future of behavioral marketing.

Since then, I have been thinking about how all that applies to my work as an Interactive strategist/marketer/story-teller at Capstrat.

First of all, game theory is a branch of math and economics (I guess all disciplines can apply) that looks at causes and effects of interactions between outcomes. Then it perfects strategies based on optimization of subsequent approaches. We use game theory to help us understand how to get the most out of an outcome based on what events other "players" choose. If player A does X then I should do Y. If player A's counter-action is Z then I should do N. And so on... They used game theory in the Kennedy administration to arrive at the following: "if worse comes to worse, the USA's outcomes are better if they launch the first nuclear device toward the USSR as opposed to the alternative."

Okay, so bear with me. Let's overlay game theory upon marketing. Here is where my mind started to melt.

Now that marketers, ad networks and really smart game theorists are seeing their targets (customers) move online toward IP-based devices, they begin to know more about individual users' behaviors, ideas and desires--or at least the Web sites they've been to recently. It is called "behavioral targeting." Using companies like Blue Lithium, advertisers can effectively predict and serve messages or outcomes on an individual basis with increasingly scary precision. They put two variations of an ad in front of you and people like you and see which yields the most favorable outcome. Then they flock around the one that wins and trash the other that didn't. Wash, rinse, repeat.

On top of that, these "agents" run by Blue Lithium can be and typically are, self-learning, self-correcting and continuously improved. And on top of that, the larger the ad network Blue Lithium and others create, the more data there is to help feed this artificially intelligent machine. Soon that data will be pooled with business intelligence gathered from your last 300 grocery visits and detailed browser history.

And if you're reading this, chances are you are a target whose name is somewhere in a database. How suprised will you be when you next go to CNN.com and see a banner for the same Volvo you test drove yesterday? 

Don't be. Someone, somewhere is working really hard to model the game where the outcome has you and your advertisers both winning.