Do You Know Which 50% of Your Audience is Going to Waste?

“Half the money I spend on advertising is wasted; the trouble is I don’t know which half.” — Nineteenth-century retailer John Wanamaker

Who in marketing or amongst those who invest in marketing doesn’t quote old John as they wax, almost poetic, over the opportunities that digital data collecting give us to micro-target…the ability to transform a company’s acquisition costs and conversion efficiency, exponentially, by utilizing the endless stream of data that all of us shed every second of our totally connected day.

Ergo…we know which half is wasted, and we can spend our money with the comforting and profitable knowledge that it’s no longer squandered by futile and fruitless advertising but rather directed in a meaning and valuable digital stream towards people who are waiting for our messages and eager to interact and engage with our highly targeted and personalized messages.

Only one problem…it’s not true.

KNEE-JERK ALERT…obviously we live in a world with data availability, unlike anything we have ever had before and, clearly, our ability to target and retarget and re-retarget is unparalleled in human history, and we do seem to know more about each other than any previous generation…maybe…

But the real question is, what about the 50%? Where did that go? And by the 50%, I mean both sides of it.

According to a recent piece in the Financial Times, “It does not pay for advertisers to narrow their targets too much.”

The more fundamental problem with micro-targeting is that for big brands, advertising has never really been about messages, even if brand owners never quite realised it. It is about the creation of shared memories, triggered at the point of purchase. Think about some of the great brands: Nike, Apple, and yes, Pampers. If you buy them it is because you know millions of others do, and because they seem to stand for something that, far from being unique to you, is common to all of us: achievement, creativity, nurturing. The broader these brands go, the better they do.

What seemed to be the wastefulness of TV was in fact its secret sauce. By reaching large numbers of people at the same time, TV ads had the power to turn brands into cultural icons, which took up residence in consumers’ minds. In its conversations with advertisers, Facebook now talks less about targeting, preferring to emphasise the sheer numbers of consumers that it can help brands to reach. It is investing in video capabilities and is encouraging its clients to make short films. After years of telling clients TV is wasteful, it is now doing a good job of imitating it.

“Short films”? A digital snackable perhaps? Bite size? Something, DIGIBABBLE forbid, like a 30-second commercial from the Stone Age maybe? Check your Facebook feed and tell me….

And, pay attention to Facebook…

The issue, Knee-Jerkers, is not digital vs TV or anything else – it’s simply a complete and total misunderstanding of what targeting is and a lack of true insight into what creates social currency, desire and opportunity to buy.

According to MIT Technology Review, “Digital Advertising Takes a Hit”:

Big-name advertisers have begun to question whether they’ve placed too much faith—and money—in targeted advertising….

…As advertisers including P&G, which spends billions of dollars each year on all its advertising for brands including Crest, Old Spice, and Gillette, have tried to assess the effectiveness of their increasing digital ad budgets, they’ve discovered that hyper-targeting consumers doesn’t always work.

When a beer brand wanted to hit a thin slice of the male audience, calorie-conscious men aged 21 to 27, Adobe tested the tactic and showed the client that perhaps it was looking through the wrong goggles to gauge success. By making its ad campaign less targeted, the brand lowered the cost of each ad impression and in the end sold more beer. Opening the target audience to a wider 21-to-34-year-old range led new households to purchase the product, [Special Operations Consultant at Adobe, Tom] Riordan says….

“The answer is not whether you should do refined targeting or not. Of course you should do refined targeting,” says Irwin Gotlieb, chairman of GroupM Global, the media agency that controls the largest chunk of the world’s ad spending, which works with P&G in international markets and its competitor Unilever overseas and in the U.S.

The mistake companies have made, he says, is to rely too much on targeted advertising, cutting too far back on broader advertising that builds brand awareness with people outside the existing customer base and eventually leads to new sales. A heavy emphasis on targeting can sometimes improve a company’s return on its advertising investment in the short term, says Gotlieb, but lead to a loss in market share over time.

Obviously, we target. Obviously, we look for the right audience and use every tool and source to get us closer and closer to the right people. Yet, you don’t want to create an ever-shrinking echo chamber…do you?

And pay attention to MIT…

The question then is, what are actual big spenders and pioneering leaders of Big Brand Digital Targeting doing with MIT and Facebook information?

As quoted by Marketing Week:

Bruce McColl, the Global CMO for Mars, was in no mood for prevarication last month at the Advertising Research Foundation’s annual ReThink conference in New York City. “I’m not a great believer in targeting,” he explained to the audience. “Our target is about seven billion people sitting on this planet”. He went on to define the challenge for Mars in equally unequivocal terms: “Our task is to reach as many people as we can; to get them to notice us and remember us; to nudge them; and, hopefully, get them to buy us once more this year.


As the Wall Street Journal reported, “P&G to Scale Back Targeted Facebook Ads”:

Procter & Gamble Co. PG 0.02% , the biggest advertising spender in the world, will move away from ads on Facebook that target specific consumers, concluding that the practice has limited effectiveness….

Marc Pritchard, P&G’s chief marketing officer, said the company has realized it took the strategy too far.

“We targeted too much, and we went too narrow,” he said in an interview, “and now we’re looking at: What is the best way to get the most reach but also the right precision?”…

On a broader scale, P&G’s shift highlights the limits of such targeting for big brands, one of the cornerstones of Facebook’s ad business….

For instance, P&G 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 18….

For many of the largest advertisers in the world, the precise targeting tools touted by Facebook are less of a draw, said Pivotal Research analyst Brian Weiser.

“The bigger your brand, the more you need broad reach and less targeted media,” he said. Targeting is paramount for advertisers trying to get users to download a game app or a small business trying to appeal to local customers.

But perhaps even more instructive is the recent US election with its, to some, surprising results — an election that had been touted as a data showdown (“Big Data could be the deciding factor between Hillary and Trump”) between two opposing and very different ideologies with dueling messages – ERGO very micro-targetable audiences.

According to Bloomberg, “No, Big Data Didn’t Win the U.S. Election”:

Again, I would have believed in the efficiency of these shamanic manipulations had I not been the recipient of numerous e-mail messages from the Trump campaign that designated me as a “Big League Supporter” and doggedly asked for contributions and moral support, though I am disqualified as a Russian citizen. Whatever contact lists Trump’s data team had, it didn’t even match them against open social network data. Cambridge Analytica’s microtargeting was obviously failing in my case. Even though I’d given my e-mail address to the campaigns of Bernie Sanders’s and Clinton, too, as I registered for their rallies, they didn’t senselessly bombard me with messages as Trump did….

Michal Kosinski, a Stanford professor, was one of a small group of researchers that pioneered the marriage between psychometry and big data. I asked him whether he believed big data had won the day for Trump.

“Obviously, it is not big data analytics that wins the election,” he wrote back. “Candidates do. We don’t know how much his victory was helped by big data analytics.”

…But just like artificial intelligence or, say, the blockchain, they aren’t killer apps that can ensure a political victory or business success. During the U.S. election campaign, I watched Cruz campaign tirelessly in Iowa, making up to seven stops a day in unheated barns and tiny diners. I watched Trump improve his campaigning technique and crisscross the country with a message that wasn’t microtargeted but that resonated powerfully with many people I met.

I also watched Clinton fail to connect, even though her campaign made use of data analytics before Trump got into that game. There is no scientific cure for this kind of thing, and no victory elixir.


In Marketing Week,Marketing in the age of Trump”:

Central to Trump’s strategy was a relentless focus on dominating the news across all forms of media….

“Great marketers know that you need a lot of people buying a little of your product to achieve commercial success,” says [Richard] Huntington. “All political success and ultimately most commercial success involves bringing together a broad church of people behind your point of view or your brand.”

So, what does all this mean?


To the contrary, I learned computer programing, back in the day, by mastering Simmons Database and Y&R’s own computer system (a huge room-size monster with white-coated attendants whose computing power was way less than my IPhone…in fact probably not even in the same universe), which I had to dial into and then, using codes, acronyms and symbols, I could devise creative targeting output that I used to develop insights and recommendations that would not have been possible before…thank you, David Fulton….

I was in the catalog industry at the dawn of the Digital Age and we saw the possibilities for People First–targeting that enabled customers across all channels of purchase – omnichannel for the Digibabble aficionados…

And I firmly believe in the power of data to help convert “lookers to buyers” as they travel the twisting and turning pathway from interest to all in. In fact, I think this is the most powerful area to focus on with data.

Data has always been a part of our world, as far back as you go. And a focus on gathering and understanding data has been a part of civilization’s evolution and development – sometimes for evil…but mostly for good and – LOL – often for shopping.

But don’t confuse what you can do because you can with what you might do because you should.

You think you know everything about me but you don’t.

So the real question is, what are you after? Listen:

Many men go fishing all of their lives without knowing that it is not fish they are after.
Henry David Thoreau

Think on that a minute – we chase data…but it’s not the data we are after, it is insight that matters. And with that insight, the data suddenly becomes ever more critical and important.

As Stanford professor Michal Kosinski, said, quoted above, “There is no scientific cure for this kind of thing, and no victory elixir.” But there is insight…

What do you think?






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