The lean startup methodology (popularized by Eric Ries in his book The Lean Startup) calls for startups to develop products iteratively—that is, to build a "minimum viable product" that will gauge demand and maximize the ways a business can learn from its customers while minimizing investment on the product itself. Customer feedback is then applied to quickly develop and launch the next version.
The thinking is that by focusing on discovering customer needs rather than predicting them, companies won't waste significant resources building products that nobody wants.
The concept of "lean," however, doesn't end there. The rise of real-time bidding (RTB) for online display advertising now allows marketing departments and agencies to build lean display ad campaigns.
In the past, creating an online display ad campaign meant first conducting extensive market research both to define a target segment and to identify the aspects of a campaign that resonate with that audience. Then, creative was developed, ad space was purchased, and the campaign was run.
The problem with that approach? Advertisers have no clear idea of how successful a campaign will be until it's over or until a sizable amount of data has been obtained.
Though it's possible to optimize a campaign based on the past performance of similar campaigns, the catch is that no two campaigns are alike; moreover, making accurate predictions this way can be very difficult and tedious. Whatever happens, in the traditional method, by the end of a campaign, significant resources will have been spent on the project with little control over its operation and optimization.
Real-time bidding, on the other hand, allows marketers new ways to optimize and adjust display ad campaigns on the fly. It's an approach much like the one Ries spelled out in The Lean Startup. With RTB, marketers can quickly and cost-effectively test each aspect of a campaign individually, and only scale all aspects and bring the campaign up to cruising speed once it's clear they have a winning formula.
Here's how it works.
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