There are some serious misconceptions in the digital advertising industry. We have somehow become very outdated in the way we think about the customer. When TV advertising started in the 1940’s marketers relied on demographics such as age and gender to define their customer. It’s all there was.
Fast forward to today, and while this for the most part is still the case for TV advertising, it surprises me that brands who advertise online are still using such a primitive method, age and gender, hoping to deliver a relevant message to any effect.
Les Binet and Peter Field have been researching marketing effectiveness for over a decade and their latest piece of work via the IPA (Institute of Practitioners in Advertising) is Effectiveness in Context.
Central to their research is the distinction between brand building and activation effects that marketing produces. Brand building is long term and drives brand growth. Activation effects are short term and generate sales spikes but no long term growth, and there is a balance to be struck between the two.
With this in mind, Binet & Field have proven short term activation objectives work best with more targeted, immediate activation tools that can typically be delivered online.
We recently conducted research across a panel of 1,250 people around their internet consumption to understand online ad effectiveness.
The results showed that of the 1,250 people surveyed over half the respondents are comfortable seeing relevant advertising, yet of those surveyed 72% who did see ads in the last four weeks said the message wasn’t relevant.
These sweeping assumptions that are made on who the target audience is needs to be reviewed. Using the example of an infant product, the advertiser will often assume the target audience is women 25-39.
Yes, it would generally be an age a woman might become a mother, however it is not specific enough and could be irrelevant to her.
Independent research from Millward Brown has proven marketers who rely only on demographics to reach consumers risk missing more than 70% of potential mobile shoppers.
From our same research study, we also found that 72% find relevant ads more appealing, resonate better with them and do not feel like they are being advertised to.
Relevant messages also lead to a better business result for the advertiser with over a quarter surveyed seeing an uplift in brand perception and are more likely to remember the ad and click on it.
Sadly, from those surveyed only 13% of people found ads they saw online to be relevant, which indicates that the current approach to using data and targeting online is not satisfactory.
It’s not all bad news, 31% did acknowledge an improvement over the last two years, however, it would suggest we as an industry have a lot more work to do when it comes to delivering a relevant ad to the customer.
Today’s customer is constantly connected to the internet and as such this behaviour has created a wealth of data points and signals which tell us so much more about the customer.
We now have insights into places consumers frequently visit like a gym, what they buy such as vitamins, or baby food and what they’re searching for like international flight destinations.
We know what they’re interested in if they’re reading fashion articles, or sports content even down to the code of sport.
When collected in a way that protects and maintains the privacy of customers, this understanding allows us to strategically target and deliver a relevant, and therefore more positively received, message to the customer.
Using the baby product scenario an advertiser could look at whether someone had visited a baby clinic in the last 60 days, purchased baby items or read content from a parenting site in the last 30 days.
This would be a much more sophisticated way of defining your audience, and a more efficient way to invest and no doubt drive a more effective result in purchase.
Yes you might see your message served to a man 25-54, that’s ok, because men have kids too, and men visit supermarkets.
Age and gender doesn’t really help an advertiser find their customer, it just narrows it down slightly at best.
At worst, it alienates people and creates resentment towards advertising.
How can we pivot?
When briefing out who the customer is, brands and agencies should be more considered and I would suggest not to even list an age and gender. Instead think about who your customer really is to define your targeting strategy and make the message more relevant.
Do they have kids? Have they been overseas in the last six months? What do they cook? What sports do they like, what kind of property do they occupy, do they have pets?
A great example of an advertiser who has approached their audience targeting strategy beyond age and gender and seen great success is Suncorp.
Suncorp came to News Corp Australia wanting to empower and enable Aussies to take control to charge forward in their home journey, shifting the conversation from dreaming to doing.
We identified threecustomer segments each created bespoke for the different stages in the purchase journey(dreaming, house hunting and ready to buy).
We created these segments using owned and partner data in News Connect, and were able to deliver a more relevant message and move the customer through the funnel.
The results saw a 7% uplift in mortgage enquiries, a 17% increase in brand consideration and 40% improvement against the CPA benchmark.
If you do not have an in depth understanding of who your customer is, then lean on the data smarts of publishers to help build this audience profile for you.
As a marketer you may not own your customer or have a direct relationship with them, in which case you might not have this level of insight.
Relevancy is key in advertising and without data, how can you make your ad relevant to your customer?