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Are Techniques Like Microtargeting and Retargeting Worth it?

There was a very interesting article in the NYTimes last week about how Facebook has “weaponized” ad tech. Although the article was really meant to highlight the abuses of political advertising on Facebook as we move toward the 2018 elections, the impact of micro targeting in the political sphere carries over to all publishers.

Facebook has made a mint by enabling advertisers to identify and reach the very people most likely to react to their messages. Ad buyers can select audiences based on details like a user’s location, political leanings and interests as specific as the Museum of the Confederacy or online gambling. And they can aim their ads at as few as 20 of the 1.5 billion daily users of the social network.

Brands love it. So do political campaigns, like those for President Trump and former President Barack Obama, which tailored their messages to narrow subsets of voters.

But microtargeting, as the technique is called, is coming under increased scrutiny in the United States and Europe. Some government officials, researchers and advertising executives warn that it can be exploited to polarize and manipulate voters. And they are calling for restrictions on its use in politics, even after Facebook, in response to criticism, recently limited some of the targeting categories available to advertisers.

Commercially, the worst offenders of microtargeting are high frequency users of retargeting, often e-commerce sites. Retargeting has now grown so accurate and often so intrusive that it does things like target people off Facebook who have had a conversation about a product on Facebook or the converse: showing Facebook ads to someone who has had a conversation about a product over, say, Gmail. Retargeting is the activity folks who are sensitive to privacy violations refer to as web stalking.

Not only that, but according to some experts retargeting isn’t even a good way to measure whether ad spend works. Retailers tend to think it helps cure the problem of cart abandonment, but they never can tell whether retargeting brought the consumer back, or perhaps payday did. Or a competitor’s ad did. We’re measuring what’s easy to measure, rather than whether our ad spend really works. This is one writer’s cynical view:

Since there is no easy way to measure if ads drive incremental revenue, it is in the best interest of performance-marketing directors, retargeting companies, ad agencies and Google to aggressively target consumers who are highly likely to purchase anyway. It amounts to a retargeting conspiracy among willful participants, and it threatens to drag down digital people-based marketing’s potential long into the future.

We think it would be much easier to measure attribution if more media buys were done with context in mind. Perhaps that’s what Amazon has in mind when analysts predict its ad revenues will surpass its AWS revenues by 2020.

 

 

The Strengths and Limitations of Programmatic

There’s a tendency lately to overrate what the garden variety of  programmatic can do. Indeed, as more and more of the market moves to programmatic trading, we sometimes forget that the highest and best use of programmatic isn’t to attract new customers; it is still for retargeting. Retargeting works.

There are now several forms of retargeting that have evolved over the years.  The first to emerge was search retargeting, which served appropriate ads to consumers who searched on certain keywords. The problem with that? We didn’t get enough scale. Too few users searched for your product.

Similarly, demographic retargeting  has its limitations, as consumers already know. It is best used to retarget existing customers or visitors, and sometimes serves an ad for a product a customer has just purchased. The severest limitation of retargeting — just like search retargeting — is for the development of new customers. Here, a different kind of data is required, and that often comes from the publisher. For customer acquisition and brand building, targeting actual websites with high quality users visiting them is still the best solution. The best targeting for expanding your customer base is still site targeting.

Thus actual site targeting, with ads served while the consumer is on a relevant website or a relevant section of a website, will work best. It works better than data to find the type of users that would visit a relevant site. As an example, if you are interested in a traveller it makes more sense to advertise on the travel section of a newspaper site than to choose the traveller category in a DSP. The DSP is using data to guess that the user is interested in travel. However targeting the travel section of the site removes the guesswork – we know the user is reading about travel. And further the user’s mind is on travel right at the point that he sees the ad. So site targeting works better – though it costs more and is difficult to find.

And that is why with our ZINC platform for media buyers we offer transparent and highly accurate  targeting of websites and sections of websites.  That really works well. Many can’t get hold of this inventory so will say that a DSP’s travel category is better and cheaper- but it isn’t better, just cheaper. ZINC’s transparent list of travel sites and travel sections will work far better – though it costs more it is worth it.