Underscore Marketing's president explains how recent M&As are delivering on promises made to media buyers during the first dotcom boom.

The laser-like targeting of online media has always been one of its selling points.  Whether we're targeting women 25-54 with a household income of $50K and up, people who have visited automobile information pages more than twice in the past week, or Jim Meskauskas' proverbial club-footed home office radiologists, the appeal of online advertising to many marketers is its ability to focus tightly on the sweet spot of any marketer's target market.

Figuring out how to pluck the right person out of a website or network's vast sea of users was just the first step in helping the internet's ad model develop. Today, we can target people based on the type of content they were reading two days ago, on their offline purchase behavior, on the registration data they submit to a website, or on any number of data points.

Developing the methods by which we gather data and target advertising was a long and difficult road. As we traveled along this road, we found that fragmentation of media consumption was playing havoc with our ability to find enough people meeting a given targeting criterion to make a targeted buy worthwhile. I'm not just talking about offline media here.

To give you an idea of what I'm talking about, let's take a look at a few sites on the internet that have the reputation for reaching certain types of people:

• Think MTV.com is all about a young demographic? Think again. According to comScore, more than 44 percent of the site's composition consists of people 35 and older.
• Think the AARP is all about older folks? More than half of its users are under the age of 55.
• Maxim is all about 18-34 men, right? Well yes, they do have plenty of young guys, but it might surprise you to know that nearly 40 percent of its online audience is female.

The point here is that lots of different kinds of people can and do show up at websites. These are just some basic demographic stats. If basic demos are challenging to roll up across the web, isn't it an even bigger challenge to roll up the inventory that advertisers most desire?

How rarely do we find ourselves buying men 18-34 online? Isn't it usually more like men 18-34 who have visited sports content at least five times in the last month and who live within a group of target DMAs? We focus that targeting laser as tightly as we can.

The problem is that the more we focus the laser, the harder it is to aggregate groups of people that fit all of our targeting criteria. Even if we are able to buy a significant number of impressions against niche groups, the tendency is to whack very few prospects over the head with ad messages upwards of 20 times. Getting scalable reach against these niches is the next challenge.

This is why you hear media buyers mumbling about publishers not being able to deliver the types of inventory they want. What they really want is the ability to achieve reach against niche prospects, which requires the application of a uniform targeting methodology to mass swaths of inventory. This was the original promise made by the early ad networks during the first wave of dotcom entrepreneurship.

Clearly, delivering on this promise involves combining targeting solutions with huge pools of undervalued online ad inventory. The targeting solution needs to be able to customize a targeting solution and apply it in such a way as to deliver on the notion of mass customization.

Sound like an acquisition deal you heard announced recently? It describes AOL's purchase of Tacoda to a "T."  But fulfilling the need for mass customization can also explain some of the motivation behind other marketing mergers, like Microsoft/aQuantive.

It will be interesting to see how Microsoft applies DrivePM's targeting technologies to its own inventory, and how it leverages DrivePM network affiliate relationships to extend the scale of its available inventory.

Advertisers are demanding when it comes to valuing online inventory, and only the best prospects are commanding the premium CPMs. To have the best chance of success at plucking those top prospects out of the internet channel, an ad seller needs to apply advanced targeting technology to an overwhelming scale.

Tom Hespos is the president of Underscore Marketing and blogs at Hespos.com. Read full bio.