How brands can adapt to the changing face of targeting – Nielsen

Consumers should always be the priority no.1 for any brand regardless of their industry or location. 1. It’s true that sales are any company’s end goal, but sales—and generating them—depend on consumers who are receptive to what a brand has to offer. And when it comes to brand building, marketers need to be able to drive engagement, awareness and consideration among people who aren’t already customers. 

The premise of audience targeting certainly isn’t new, but with rapid change in what’s possible, marketers need different tactics and strategies than the ones they’ve been leveraging over the past 20 years or so. Addressable digital advertising has long been the channel most used for targeting, and the increasing adoption of internet-connected devices and smart TVs is now allowing marketers to bring that same thinking to linear television and other “traditional” media at scale. With privacy-safe surfing, addressable digital is changing. This presents new opportunities and challenges. Let’s look more closely at these two areas.

Addressable technology

Digital has been the predominant channel for ad targeting, largely due to addressability—the ability to deliver an ad to a specific intended target, at scale. While that addressability is an advantage, marketers must note that it doesn’t equate to perfection. Data from SME Digital Ad Ratings (DAR) highlights that the average on-target percentage of ads across computer and mobile is 63%—even for targets defined by age and gender—targets for which there’s significant data coverage and quality.

That doesn’t mean that marketers shouldn’t use data to reach specific audiences. Marketers should use high-quality and deterministically collected audience data in order to increase accuracy. To be able compare data sets, and to assess their value, marketers would do well to improve their measuring of accuracy in targeting and sales impact.

Third-party identifiers

No discussion of digital targeting would be complete without a consideration of the future state—a world without third-party identifiers. However, it is clear that 44% (or more) of U.S. internet users use browsers without third-party cookie. Additionally, many have disabled mobile device tracking from Apple IOS 14.5 upgrade. This represents an important portion of internet users who are operating without third-party identifiers. DStillery stated in a blog posting earlier this year that up to 90% display impressions would be free of any third-party ID. Addressability and performance of ads are both at risk when impressions are sent to anonymous viewers. 

An advertiser can respond to this increasing challenge in three ways:

• With persistent individual-based identifiers, lean on first party-data
• Leverage the addressability of digital video; it’s the future (CTV, smart TVs, etc.)
• Optimization vs. tapping in to decades-old context targeting technology: Leverage innovation or not

The collection, maintenance and application of person-based identifiers requires an investment in first party data—the data companies collect directly from users or people in a consent-compliant way. The data can be rooted in other persistent ID forms like email address, telephone numbers, and physical address. These IDs are privatized using a range of shared hashing protocol. They can then be shared and matched for targeted advertising.

Advertisers must have the ability to target users based on their IDs in order to succeed within this environment. You need to speak the same ID language used by content creators and publishers who draw consumers to their properties.

Effective marketing, which includes engagement, awareness, and consideration, is cost-efficient from an economic perspective. Quality audience data is crucial to media efficiency, even though advertising budgets are increasing in many countries. That’s where developing a data strategy—and data connectivity for activation—is a critical undertaking. A lack of high-quality data is a major problem for many marketers.

Importantly, brands can’t approach targeting in a vacuum, and audiences shouldn’t be copy and pasted from one channel to another. Brands should be leveraging a comprehensive audience strategy across linear and digital channels that leverage each medium’s strengths. These efforts should be made alongside measurement that can help validate sales and brand lift impact—ideally while campaigns are in flight rather than months after the fact.

Get more insight from our latest report Advertiser Playbook.