iOi builds digital profile from cellular data

Gabi Attal Photo: Eyal Yitzhar

Gabi Attal has founded a big data company that utilizes cellular operators and is trying to buck the Google-Facebook digital ad duopoly.

Advertising and media specialist Gabi Attal has founded a big data company that utilizes cellular operators. The company named iOi, has developed a system of analytics and algorithms that compiles digital profiles of people on the basis of data collected from the cellular operators, sources inform "Globes."

The system operates on the basis of the network of Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) and HOT Mobile Ltd.. A project with Ynet for using the data, managed by Ynet CEO Avi Ben-Tal, is underway. The technology, which is stationed on the companies' networks, collects the subscribers' surfing data, and monitors and analyzes them. Behavioral profiles are constructed from these data, to which digital marketing activity can be optimally adapted, including advertising campaigns and ecommerce.

Two types of connections are needed in order to apply the technology. One is a connection to the cellular operator in order to obtain the data - iOi is connected to the network of Cellcom and HOT Mobile. The other is a connection to the media that will receive the data. iOi has been conducting a series of pilots in recent months for this purpose in order to explore the possibility of becoming Ynet's data supplier in the part not marketed through Google.

In early August, Ynet disconnected itself from Artimedia - the programmatic marketing platform encompassing the activity of media - which it had used for the past two years for marketing its video advertising. A significant proportion of their inventory is supposed to be marketed through Google's technologies and the rest independently, so that dependence on Google is not absolute. The part not marketed through Google, however, needs the intelligence of the data, which is the reason for the attempt at cooperation with Attal's company.

Data is regarded as the Holy Grail of the marketing, advertising, and media sector. It is the part that makes it possible to turn the general consumer appeal used for many years in media such as television into a personalized appeal. There are many types of data, but two of them are considered better than the others: data collected from the credit card companies and data collected from the cellular companies.

The cellular companies have a big advantage, because a large proportion of Internet surfing is currently conducted on mobile devices, from consumption of new and culture to collecting information, and even making payments. Someone who is connected to a cellular operator's network therefore knows what apps a person is using, what information he is consuming, and even his location.

The data being used, however, is anonymous, as required by the privacy protection laws. In other words, a person's behavior can be characterized. It can be determined whether a person is male or female, and the person's family status, shopping habits, hobbies, etc. can be deduced, but this cannot be connected to identifying particulars, such as names, telephone numbers, or addresses. For this reason, the data obtained pass through a process of flattening and separation from the people themselves, and is processed into the profiles.

Data and targeting capabilities play an important role in making Google and Facebook a duopoly in digital advertising, because their knowledge about surfers is enormous. On Facebook, the surfer himself independently provides particulars such as age, gender, family status, hobbies, friends, etc., and additional information is derived from his activities. Google, on the other hand, has contact with a great many interface points in the consumer's life, from the mobile telephone he owns to all the websites and apps he touches and the fields of interest according to which he conducts searches.

In contrast to Google and Facebook, the information about webs surfers available to other media is very limited. At best, they know where he is surfing. The realization that the gap in capabilities is acute has struck the market, and initiatives aimed at minimizing the duopoly's power have begun to emerge. Coalitions of other media have begun to emerge aimed at maximizing the power of content creators by combining their forces.

The first to utilize this concept was Amit Ohayon's ILX, which used a programmatic platform to create a joint theater - an exchange for trading in online advertising. This was followed by Artimedia from the Artivision group, which in the first stage made gaining control of digital video advertising its goal. The carrot it extended to media in order to induce them to cooperate was monetary, not technological. Artimedia purchased in advance all the major websites' video advertising, thereby giving them an economic motive to cooperate.

That, however, was not enough. It quickly emerged that in order to rein in the power of Google and Facebook, data and targeting capabilities have to be inserted into the content. In the second stage, various parties tried to provide a solution for this. Ohayon founded IDX - a data coalition in which some of the major media participate. Artimedia focused on in-house technological developments, and tried to cooperate with startups in in the sector, such as BehavioReal, which also relies on cellular operators. The parties have already agreed to cooperate, but a report in "Globes" and the regulatory response to the matter have led the cellular companies involved to halt the process.

Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) devised its own response to the matter by beginning to develop an advertising agency on the Walla! website, one section of which will be responsible for the data derived from the company's groups, such as Walla!, Pelephone Communications Ltd., and Bezeq.

Despite all these attempts, Google remains the main power in the advertising market in Israel, which did not prevent it from attempting to undermine the media coalition that had been created. It appears that what disturbed Google in particular was the connection in the video advertising sector, the fastest growing advertising sector, and especially Artivision's undisguised ambition to be a laboratory in Israel, and to then copy the format to other markets around the world.

In recent years, Google has therefore devoted efforts to inducing large players to withdraw from Artimedia, thereby weakening it. This effort was eventually successful with Ynet. There were many human reasons for this secession, but the technological gap between the technological capabilities of Artimedia and Google was one of the main reasons for Ynet's action.

iOi will now try to supply the data in the part not marketed through Google, but it appears that the company does not plan to confine itself to this. Attal met in recent weeks with senior figures among the content creators, presented his system to them, and considered with them possibilities for future cooperation. Off the record, a number of sources said that he intended to create a new media coalition based on the data capabilities provided by the system.

The real target: Overseas marketing

Despite the buzz about data and the ability to create profiles from it, in a small market like Israel, this does not have dramatic importance, because some of the cross-sections are liable to be very small. Everyone involved in this is casting eyes at overseas marketing, where the numbers are much larger, and not only can real added value be provided for an advertiser, but also a large return for the data marketers.

The connection between means of communications, media, and advertising is popping up all over the world. One prominent example is Verizon, which is regarded as a pioneer in the field. These connections are being created through a connection between two needs: the media, which are confronted with the duopoly's worldwide power, and more and more companies that are accumulating high-quality data in the course of their activity.

In the case of the cellular companies, the data is ostensibly theirs, and it can be asked why they need an external company in order to use it. The answer is simple: they lack technology for collecting the information and turning it into profiles, and they lack media that they can use for active advertising. Do Israeli companies like iOi have a chance of reaching these markets? It is too early to tell. At this stage, the burden of proof is on iOi, which will be evaluated in the end according to the real technological capabilities it presents, not its ability to market its idea.

The face of the company is Attal, one of the most veteran media people in Israel, who for years was CEO of Zenith Meda from the Publicis group. He joined forces in 2015 with Israeli digital pioneer Ran Berko, and they founded a specialist digital agency. Their cooperation continued to iOi, in which Yosi Arie, responsible for analytics, and Eran Mos, who is managing the company, are also partners. Former Super Pharm marcom manager Michal Farsi is managing iOi's business in Israel.

Attal declined to respond to the report, and Cellcom denied it.

Published by Globes [online], Israel Business News - www.globes-online.com - on August 15, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

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Gabi Attal Photo: Eyal Yitzhar
Gabi Attal Photo: Eyal Yitzhar
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