Over the past decade, marketers have spent an increasing amount of their marketing budget on web display advertising. In fact, U.S. online advertising spending is expected to reach $31.3 billion this year—a 20% increase, according to a recent report by eMarketer.
This growth, despite challenging economic times, has been fueled by continuous innovation in
display ad targeting. The most recent has been the emergence of anonymous consumer profile (ACP) targeting.
Early on, web display advertising was focused on site-based targeting, i.e. buying ads on a particular website. In the past few years, however, spending has begun to shift to audience-based targeting. Using this approach, marketers solicit specific consumer segments based on a rich data set that defines audiences by characteristics. This is similar to the way direct or email marketers would segment their files. Media is displayed across a wide range of websites, wherever the target audience can be found.
This audience-based targeting was dominated by online behavioral data. It selected consumers based on recent online activities. For instance, a travel marketer might pitch consumers who visited travel sites in the past seven days. ACP targeting, however, defines consumer segments using richer and more stable data, like purchase behaviors, demographics, financial and lifestyle data, that has been generated across multiple channels over a longer period of time.
With ACP targeting, a travel marketer could present web display ads to consumers who have been consistently active travelers, are married with young children, meet specific income thresholds and live in specific geographic regions.
This deeper data toolset offers the promise of higher ROI and broader relevance for display programs, benefiting both the marketer and the consumer.
To be successful in ACP targeting, marketers should focus on the following six tenets:
1. Know thy data. More comprehensive consumer data is available today than ever before. This data includes customer demographics, financials, transactions, CRM/campaign history, in-market indicators, lifestyle and interests. But not all data is created equal. For instance, a segment called ‘Income’ could be derived from spending behavior, self-reported information from a survey, extrapolated from census results or estimated based on the web sites a consumer visits. These segment sources have different biases and will impact campaign results. It is important to understand what data are most appropriate to use in campaigns based on their objectives and goals.
2. Move Up The Funnel. Traditional audience-based targeting which uses online behavioral data is particularly well suited for bottom of the funnel activities, such as determining which consumer is most likely to buy a product today. However, ACP targeting uses data based on longer-term consumer behaviors and purchasing patterns. These include knowing which consumers are consistently active in a product category and have profiles consistent with a brand. This type of data can help refine targeting throughout the branding/awareness, purchase and referral funnel.
3. Be Audience Centric, Channel Agnostic. Since consumer profile data are stable and not channel-specific, they can drive programs across multiple media. Use the same target audience definition for web display, email, direct mail and television. By placing retargeting cookies within email campaigns and on a web site, a marketer can use other marketing channels to help build your display audience and extend your marketing investment.
4. Adapt Traditional Offline Data for Online Use. Although the same audience profiles developed for offline use are viable online, channel-specific response models may be adapted for web display. For instance, a response model designed for targeting direct mail or email may need to be modified or combined with other data for use online. A marketer should consider overlaying online activity measures to refine the audience and reach consumers who are both responsive and active in the online channel.
5. Measure and track results across channels. Well-targeted display ads can drive immediate response online, but they also impact performance in other channels. ‘Click through’ conversions reflect the ad, but what if prospects type in a URL directly instead of clicking the ad? Nielsen found that combination TV and display campaigns drive 157% lift compared to TV alone, while Comscore found a 155% lift in search results when search was combined with display. These cross-channel interactions may be difficult to measure, but ignoring them can lead to under-investing in display media and hurting the overall marketing program.
6. Make consumer privacy a top priority. Even anonymous users should still be given control over their ad targeting preferences. For instance, the “Advertising Option Icon” Privacy Icon developed by the Digital Advertising Alliance enables consumers to see what data was used to target an ad and opt out of future targeting without disclosing their identity. Consumers expect this kind of transparency, and providing it will earn their trust.
By keeping these six tenets in mind, marketers can add ACP targeting to their web display arsenal and get even more out of an online advertising program.
Kerry Morris is vice president of product management at Epsilon Online Solutions.
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