Oracle hopes to better target online advertising with Datalogix acquisition

Half the money spent on advertising is wasted -- the question is, which half? That's the age-old question in adland. Now Oracle is hoping to help its customers answer that question with the acquisition of Datalogix, which collects offline consumer spending data in a bid to help online advertisers pick the right targets.

Many behavioral advertising targeting systems track only consumers' online behavior -- but, according to Oracle, that accounts for just 7 percent of consumer shopping: the other 93 percent is spent offline, and must be tracked in other ways.

Datalogix aggregates data from 1,500 partners on the US$2 trillion spent each year by 110 million households, and uses it to help its customers target advertising based on other purchases to improve their sales. Those partners provide it with information on 99 percent of U.S. automobile sales and a 20-year history of vehicle ownership, and it also tracks spending at 50 grocery chains and 1,400 other retailers.

The company counts traditional manufacturers including Ford, Unilever and Kraft among its customers, as well as online services such as Facebook, Twitter, Yahoo and Google.

On Monday, Oracle agreed to buy Datalogix for an undisclosed sum, saying that together the companies will provide marketers with a richer understanding of what consumers do, say and buy, allowing them to measure the effectiveness of their different campaigns and advertising channels.

Oracle plans to link the Datalogix service, which provides the spending data to customers through a cloud-based tool, to its other cloud-based services via Oracle Identity Graph. This, it said, will allow it to connect consumer identities to build better profiles that can be used to personalize online and mobile services -- and even to target them offline and via the TV.

It made no commitment to maintain the existing Datalogix product roadmap, saying that it was still reviewing its plans. The companies set no timeline for completing the deal, which they said must meet customary closing conditions including obtaining regulatory approval.

Peter Sayer covers general technology breaking news for IDG News Service, with a special interest in open source software and related European intellectual property legislation. Send comments and news tips to Peter at peter_sayer@idg.com.