How to Target the People Most Likely to Sales Respond

Now that addressable media include not only direct mail and telemarketing, but also digital and an ever-growing part of television, the age-old question demands to be answered: To whom should I be targeting? It's obvious that one should protect the current customer base. But that's a leaky bucket strategy. Byron Sharp and others hasten to point out that a brand must constantly bring in new customers. One way brands try to do this is by reaching current customers on the assumption that new customers will look exactly like the old ones. Another approach is to target category users, thereby reaching one's own brand users and also users of competing brands.

At TRA, I coined the term Heavy Swing Purchasers, meaning category heavies who buy your brand occasionally, as we observed this to be the most sales-responsive group for most mature CPG brands studied. However, I've always believed in principle that advertising ought to be directed to those people who are most likely to begin/increase their usage of your brand as a result of ad exposure -- where you can make the most difference. In CPG, this turned out to result in the selection of almost the same media vehicles as Heavy Swing Purchasers.

Being able to fine-tune targeting to this degree appears to be widely available today in digital. However, most advanced targets being sold and bought today in digital and in television are not based on direct match (deterministic) a la TRA, but on fusion (probabilistic). TRA compared direct match car ownership data with Zip code-level fusion car ownership data and found that only a handful of very expensive cars had a strong enough relationship with Zip+4 for the fusion to be more than random.

These fusions by demographics and geographics, according to results revealed by Simmons Research at the ARF Annual Conference, on average explain only 5% of the variance in predicting brand usage across thousands of brands (including media) in all verticals. More recently however, Simmons developed an innovative new approach -- called Predictive Consumer Insights -- in which they use psychographic statements and RMT DriverTags^TM to triple the predictive power to 15% on average.

It's not the demographics that cause the use of the specific brand -- the demographics are a blunt tool for predicting brand choice, when compared to characteristics that are more psychological in nature.

Predictive Consumer Insights also reveal what makes a brand special to its consumers, based on what motivations predict usage. This understanding looked at in a competitive context can be very clarifying to the process of developing new creative executions.

If you'd like to watch a replay of the Simmons webinar or download the slides, it is available by visiting

How to Target the People Most Likely to Sales Respond

Publish date

Channel

Bill Harvey