Marketers Must Strike the Right Balance of Audience Reach and Targeting

According to WSJ amp8220PampampG two years ago tried targeting ads for its Febreze air freshener at pet owners and households with large families The brand found that sales stagnated during the effort but they rose when the campaign on Facebook and elsewhere was expanded last March to include anyone over 18amp8221We encourage brand marketers especially consumer packaged good CPG companiesamp160that need to reach a wide audience through multiple channelsamp160including TV to use a broadreach strategy As the article underscored PampampG does not intend to spend less on Facebook only differently with broader targetingAdvertisers Experiment with New Precise Ad TargetingIn the past few years we saw many consumer packaged goods CPG brands experiment with more precise targeting approaches once more specific targeting options became available For example the Pampers brand team could hypothetically use thirdparty purchasing data to deliver ads on Facebook to Huggies customers Or the Pampers brand team could could target Pampers loyal customers with messages on Facebook to encourage customer loyalty and try new products in the Pampers extended lineThe result of buying against very targeted smaller audiences was expensive CPMs These higher CPMs rank poorly in Media Mix Modeling MMM results a method marketers use to attribute sales or other outcomes to different media investments Note this outcome of shifting to broader reach was for brands driving instore purchase of lowerpriced products as opposed to direct response advertising objectives For direct response ads selling products online measurement is more clear from impression to purchase and more specific targeting even though it is more expensive usually makes senseNow many of those CPG brand marketers that like PampampG experimented with narrow audience targeting are learning and calibrating their strategies Instead of targeting very specific small groups of people like pet owners these marketers are building quality audiences on Facebook that are broad enough to reach more people at a lower cost per person and deliver measurable sales impactWhether they are small or large addressable audiences on global platforms like Facebook are among the best digital channels Broad efficient and fraudfree reach to such massive audiences is a huge value proposition on its own When you can reach 3X the users and 3X the cost efficiency you can achieve real business impactBalancing Targeting with ReachWhile there are many big brands in PampampGamp8217s scenario there are many brands with niche audiences ie craft beers for example that are experimenting with a concept we call amp8220broad segmentationamp8221 This involves applying the principles of broad efficient CPMsamp160while concurrently deploying more personalized messaging and tailored media strategies against key customer segments within the broader groupTo be sure more precise targeting will always be hugely valuable for marketers and retailers engaging in directresponse advertising like Verizon trying to sell phones and plans Kayak selling hotel rooms and flights and Bloomingdales selling fashionable clothing Ultimately the right mix of reach versus targeting will depend on the specific brand its category and its business goalsPampampG made the right call opening up their targeting Hundreds of SocialCodeamp8217s proprietary studies among Fortune 500 brand partners support this for large CPG brands Advertisers that pair broadly targeted marketing buys with studies to measure what consumers are buying in stores often achieve sales lifts upwards of 10 on a single digital campaign This result is driven by increased purchase volume among existing customers as well as by significant lift in new household sales and new customersBut the lesson is not to turn away from targeting It is to always validate strategic decisions and big media investments with consumer lift measurement Advertisers and their partners must understand digital platforms well enough to capitalize on their mass reach and targetability amp160in unison amp160to maximize sales and ROIOriginally published at SocialCode Thought Leaders on August 16 2016The opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaVillagecomMyersBizNet Inc management or associated bloggers

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Marketers Must Strike the Right Balance of Audience Reach and Targeting

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Marketers Must Strike the Right Balance of Audience Reach and Targeting

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