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Are Your Targeting Objectives Sabotaging Your Business Objectives?

Published: Friday, September 30, 2016 @ 12:13 PM

Are Your Targeting Objectives Sabotaging Your Business Objectives?

Today’s marketers have a myriad of data and technology tools to use in their quest to target and engage with individual consumers. Between these tools and programmatic buying technology, any brand can now create what can appear to be a foolproof digital advertising plan. But sometimes, having niche targeting as a primary objective is at an advertiser’s peril.

Targeting is a tactic that serves a specific role. Marketers may miss opportunities when targeting is used improperly, misunderstood, or when it forms the strategic foundation of the campaign rather than the business objective.

Successful ad planning should not start with a targeting objective. It should always start with the business objective.

Suppose a casino releases an online game and runs a digital campaign to promote it, focused on targeting customers likely to visit the property (the business objective). To execute this strategy, strategists rely on proprietary data.

The company’s historical market research may suggest that the best target would be heavy casino goers (10+ times per year), who are more likely to be female, 45+, with a median income below that of the average adult.

But this target would miss a key segment by definition. If you look more closely at the online gambling profile, the audience is significantly more likely to be male (60/40). They are also young, with a median age 10 years younger than the average adult, and with a significantly higher income.

If the casino executed a targeted campaign against the findings of its historical data, the ads would likely have targeted women ages 35-64 with a household income of $50-$75K. A campaign targeted in this way would have completely missed a key audience of men, ages 18-34, with a household income of $100K+. While the targeting objective would have been fulfilled, the casino would likely be disappointed in the traffic generated to the site, which is the business objective.

For this reason, it makes a lot of sense to combine campaign elements, especially with new product releases or new entrants into the market, rather than immediately jumping to a hyper-targeted solution.

Advertisers should rely on macro campaigns alongside a targeted campaign, based on the best data available.

Macro campaigns are spread out, with limited targeting, in order to learn about conversion patterns: Who is most likely to convert? Where are they coming from — what types of sites? Such a campaigns wouldn’t or shouldn’t have a conversion KPI against it. It should be simply for learning purposes. The targeted campaign, on the other hand, can have a conversion KPI against it, but it should be optimized as lessons from the macro campaign come in.

In other words, the campaign results should inform future targeting decisions. Targeting at its best is not a static tactic — it’s not set it and forget it. It’s s an ongoing process used to hone strategy and better improve the results of a campaign.

For example, take a brand looking to increase foot traffic into its brick-and-mortar stores. Based on in-store foot traffic, men ages 18-45 dominate the customer base. The campaign objective is to simply increase revenue per store. To do so, the company executes a campaign targeted toward this male audience, with a promotional coupon for in-store use.

The brand also decides to run a macro campaign alongside this targeted initiative, using the same promotional coupon. It find that a subset of female consumers reacted to the coupon, and they tended to spend more per transaction when they came into the store. Based on the campaign objective, increasing traffic of women in-store presents a solution. The brand can use this information to further drill down its audience targeting, without leaving any potential customers on the sideline that might be key to fulfilling its objective.

Targeting technology has indeed given advertisers a powerful and efficient way to reach the right audience. But, like many things in business (and life), it requires a thoughtful approach. Though helpful, it may, in fact, cause more harm than good in achieving business growth goals. But, when utilized in a thoughtful, strategic way, it can boost a digital advertising campaign beyond its original objectives. Its impact is completely dependent on its use.