In recent years, the online advertising industry has increasingly leveraged geographic, demographic and behavioral targeting in their quest to attract only the best, most qualified users. In doing so, nationwide, non-targeted campaigns have been pushed to the wayside when in fact, they still perform very well on some of the web’s largest publishers. These campaigns deliver on pace, have a fantastic click through rate (CTR), and most importantly, perform strongly against advertiser performance metrics. Here are four important things that every advertiser should consider before jumping on the over-targeting bandwagon:
A Losing Proposition
First, let’s take a look at the constant balance every ad publisher must strike. They need to find a way to deliver what seems like the impossible; perfect, complete delivery while maintaining spot on performance. Anyone who has spent any time with an Ad Ops team knows exactly how frustrating it can be to try to get a campaign that has been completely strangled with targeting to deliver in full. And if/when the campaign isn’t hitting the performance metrics, there’s no place to go to optimize things. The advertiser has preemptively done everything they could think of to optimize their campaign before even a single impression delivers. At its core, it’s a losing proposition, for both the publisher and advertiser. The publisher is wasting time and effort scrambling to keep the business, while the advertiser has a lame duck campaign that’s not delivering what they need.
How did this broken model come to be? It’s a coelacanth, a remnant of a prehistoric time that somehow has held on through the ages, though everything else has evolved. Targeting is basically the online version of placing radio buys with a local station that serves a certain demographic or running print ads in the local paper. There’s a reason why those models have failed. As things become more globalized, the targeted local model is destined to fail.
Opting for a Percentage of a Percentage
Let be honest, if a company has an online presence, it’s a global company. As such, anyone with an internet connection has access to their information and services. That’s a huge amount of people that are in the potential market for an advertiser’s services. But instead of taking advantage of that large customer pool, and trying to get the business from as many of them as possible, advertisers are opting for a percentage of a percentage; they’re trying to grab the mythic “highly qualified user” while ignoring the remaining audience.
At WhitePages, we have seen repeatedly that this is a mistake. What happens to the people who are just outside of the advertisers chosen location, but are close enough to get use out of it? What about the people who have an IP address that incorrectly puts them in a location 50 miles away (far more common than anyone wants to admit). What happens to the outliers, the non-typical potential customer, or anyone who doesn’t fall into a nice and neat targeting bucket? Or simply those who are tech savvy enough to clear their cookies on a regular basis? Most of the valuable highly educated, high income audience is going to know at least the basics of using a computer. With one simple target, you cut all of them out.
The Very Real Issue of Oversaturation
Even assuming the advertiser has found the perfect customer pool, and are targeting to them exactly, they still run into the very real issue of oversaturation. If an advertiser is targeting a group of 50,000 potential customers, that customer pool will remain fairly stagnant over the length of a campaign. If the campaign is location targeted, it’s highly unlikely a significant number of new users will be added to the location during the campaign. And if it’s behavioral targeted, the average behavioral targeting cookie lasts about 6 weeks, longer than the length of the average campaign. With little turnover in those customer pools, the same people are seeing the same ads over and over and over again. In many highly targeted campaigns, we have seen fantastic performance at first which then falls off very rapidly as the targeted customer pool is over-exposed. As a result, the targeted audience may be “perfect” for the first week or two of the campaign, but rapidly become the kind of users an advertiser would want to target away from.
In our day to day business, our general non targeted placements have the best CTR, delivery, performance metrics and return on investment. On average we see a nearly 50% higher CTR on our successful ROS placements than our heavily targeted placements. And more often than not, the performance metrics follow that trend. The advertisers that make the choice to run without a noose are reaping the benefits of capturing the audience that everyone else is ignoring. They have adapted to the realities of the global qualities of internet advertising, and stopped trying to shoehorn a new marketplace into an old model.
A Tool to Fine-Tune Campaigns
Targeting is not intrinsically bad, but it needs to be used as a tool to fine-tune campaigns as they run rather than before they even start. One of the big advantages of online advertising versus all other media is the sheer amount of data available as a campaign is up and running. It’s possible to look at the most granular data imaginable and pick out hidden patterns and trends to maximize the return on investment. The advertiser should choose to run on a site whose general audience matches their needs, start the campaign as ROS and keep a close eye on the metrics. Within a few days, patterns and trends will emerge. The real customer pool will start to emerge, and then targeting can slowly be added. Advertisers and publishers need to work closely together to look at trends and add/remove targeting as necessary, and adapt to audience trends.
It’s time to stop fighting against the strengths of online advertising. If we as an industry embrace its global nature, availability of data, and allow ourselves to adapt to an ever-changing audience, both advertiser and publisher stand to profit handsomely. And that can only serve to benefit the industry as a whole.
In recent years, the online advertising industry has increasingly leveraged geographic, demographic and behavioral targeting in their quest to attract only the best, most qualified users. In doing so, nationwide, non-targeted campaigns have been pushed to the wayside when in fact, they still perform very well on some of the web’s largest publishers. These campaigns deliver on pace, have a fantastic click through rate (CTR), and most importantly, perform strongly against advertiser performance metrics. Here are four important things that every advertiser should consider before jumping on the over-targeting bandwagon