smartphone and tablet

The conversation around mobile these days most often comes down to one thing: Monetization. From Web giants like Google and Facebook to indie developers, everyone is looking for solutions for generating revenue on devices with limited screen sizes and dramatically different usage patterns, relative to the desktop Web, without damaging the user experience.

Today, machine learning-based ad targeting startup Drawbridge announced a new solution to this ubiquitous problem. The company has been testing its new cross-device mobile-to-mobile retargeting solution for several months in private beta, and today makes the platform available to the public.

Tracking users activity online was far easier when the average user conducted the vast majority of their Web browsing activity on a single PC, and cookies could easily track browsing during and across sessions. But as users began using multiple devices, including mobile devices which cannot be tracked nearly as effectively using cookies, this became a much less simple proposition. In its previous solutions, Drawbridge enabled marketers to connect user identity across PC and mobile devices, such that, for example, they could recognize when single user views a banner on a PC and then later downloads the corresponding app on their mobile device. Today’s new solution extends this functionality between mobile devices.

Drawbridge’s cross-device mobile-to-mobile retargeting product allows marketers to input criteria to define target audiences, such as lapsed, not-yet-activated, or most loyal users, among current and previous mobile users, and then target marketing campaigns based on this identity.

Since its launch, Drawbridge has specialized in using big data analytics to parse billions of ad requests based on device ID, device type, browser type, IP address, and time to observe the online behavior of an individual user across both the desktop and mobile Web. But this technology has historically been limited. All data coming into the Drawbridge system from ad networks is anonymized, and as a result the system has only been able to offer 60 to 70 percent accuracy, on average. Cross-device tracing purportedly offers dramatically more accurate results.

Drawbridge is claiming some impressive results from its early trials, although its data set is certainly limited in size. The company claims that marketers targeting “lapsed users” have achieved over 100 percent Return on Ad Spend (ROAS) —  incremental profitability, as compared to the cost of the ad campaign — in under three weeks. Moreover, marketers targeting “active users” have seen more than 100 percent intraday ROAS. If the company is able to sustain these results across broader deployment, it would easily be one of, if no the most effective mobile marketing technique.

“Marketing efforts in mobile have been concentrated in new user acquisition, as marketers scrambled in the land grab that mobile offered as a platform,” explains Drawbridge founder and CEO Kamakshi Sivaramakrishnan. “However, many marketers have already acquired millions or even tens of millions of users; they now need to turn their attention to tools and techniques that allow better engagement marketing towards this user base.”

Similar trends have unfolded in the ecommerce sector, where companies spend enormous sums of money to acquire customers with the hope that they will eventually pay back that investment in lifetime value. But without dedicated customer retention and reengagement efforts, this often proves to be an ineffective strategy. Companies like Retention Science have emerged to offer software tools to improve retention rates.

Today’s announcement comes at an interesting time in the user privacy debate, with most of the largest Web companies defending themselves against accusations that they’ve offered the NSA backdoor access to user data via the PRISM program. Drawbridge, however relies on anonymized user data that is used in one manner or another by nearly every other ad-tech company. Nonetheless, it’s a sensitive subject and grabbing headlines around “user tracking” will surely raise a few eyebrows. Drawbridge appears to be acting responsibly, and is surely in line with the rest of its industry. Moreover, if the company can do its job effectively, it stands to benefit consumers through more applicable and well-targeted advertising. After all, if we’re going to be advertised to — which isn’t changing any time soon — it might as well be with relevant and appealing ads.

Drawbridge completed a $14 million Series B financing round in February that reportedly valued the company at an $85 million pre-money valuation. The round included Northgate Capital, Sequoia Capital, and Kleiner Perkins Caufield & Byers. The company was reportedly operating at an $8 million per month revenue run rate at the time of this financing.

    1. Sequoia Capital
      Past Investor
    2. Rahul Bafna