Targeted Display Advertising Drives Customer Engagement

 

Executive Summary:

As many savvy media buyers know, well-placed digital display ads can offer a far better ROI than TV spots. They’re interactive (often), trackable and cost effective. Display ads may represent a successful way to provide more-effective impressions, branding and targeting compared to their older TV cousins.

Key insights include:

  • How marketers can stand out in a sea of “banner blindness.” Everyone knows customers tune out unsolicited online ads. However, by driving top-of-the-funnel awareness, display ads can (and do) play a bigger role in purchase decisions than they’re usually credited for.
  • Instead of alienating would-be buyers by following them with ads for products or services that have been viewed and rejected, we can use CRM and related data to determine what the customer is looking for.
  • Data should be part of the creative marketing process.As Michael Lowenstern, managing director of digital at R\GA in New York says, “Targeted media is good. Targeted media plus targeted creative is better.”
  • Intelligent use of display advertising can improve ROI.
  • Use content strategy from the start. Figure out who you want to be.
  • Drill down and meet your customer where she lives, works and plays—online and off.

A Sea of Banners

The world is awash in advertising, and the Internet is drowning in it. According to a recent ComScore reporti, advertisers served more than 5.3 trillion display ads to U.S. users last year, representing a whopping 1 trillion more than last year. In just a month, the average Internet user sees 1,707 of them.

It’s enough to make anyone tune out. So how, exactly, can advertisers beat banner blindness and drive direct engagement with consumers online?

According to eMarketer.comii, “Programmatic buying will continue to gain a greater portion of display spending in the US this year” and beyond. Mobile internet display ad spending, it predicted, would reach $3.81 billion this year (up 21.7% from last), rise steadily and reach $14.50 billion in 2017.

Many media buyers are moving toward this change. “Like most of the industry, we’re not necessarily moving TV dollars toward digital as much as we’re moving budgets from other media like print and radio,” said Sean Corcoran, SVP, director of digital and social media for Mediahub/Mullen in Boston.

“The challenge with traditional media is that it still almost entirely relies on top-level targeting, specifically age ranges and content (for instance, sports for men ages 25-to-44). Digital media, on the other hand, is using multiple data sets in near real-time to serve up advertising to the right people at the right time in the right environment with the right message.”

Corcoran added, “Nielsen has recently proven digital media to be a great complement in adding unduplicated reach to TV advertising, because there are audience members who are fairly light TV viewers but heavy digital viewers. So ultimately, we are getting more effective impressions because they are not only more targeted, but we’re able to make near real- time changes based on the results we get.”

How can you make intelligent use of the technology to make sure your ads stand apart from the rest?

Be Relevant, Not Personal

Used well, online ads can drive top-of-funnel activity, increasing brand awareness and maximizing targeted impressions. A 2012 Bizo marketing blog article says that display ads begin the process by raising awareness. “Blogs and other inbound marketing strategies build exposure and drive prospects to your site through organic search.”iii

Consumers, of course, appreciate convenience as long as it doesn’t cross over into creepiness. “We like to think we’re in the business of keeping the Internet free,” said Michael Lowenstern, managing director of digital at R\GA in New York.

Lowenstern told a roomful of marketers at Digiday’s Agency Summit in Scottsdale, Arizona, that while consumers complain about “creepy” tactics like retargeting, they’d rather not pay for subscriptions.

The best way to keep on the consumer’s good side is to walk the line between personalization and relevance. “We prefer the relevance route,” Lowenstern said. Avoid crossing the most obvious lines—name, age, income, credit score or sexual orientation—in your creative messaging.

A finer line should be drawn, though, between creative that targets users based on interests versus those that target based on super-specific behavior. Ads for hiking shoes might appeal to a user who recently shopped at outdoor outfitter REI. Showing the same user a retargeted ad featuring the very shoe she browsed, but did not buy, only reminds her that online advertisers are following her every move.

How do we find the appropriate balance? A mix of IP location- based, demographic and predictive purchase behavior data, as well as the customer’s own CRM data, can create a powerful combination of targeting information to help drive relevance. Plus, selecting the websites where ads should appear — or not —can help identify sites with content that aligns with brand objectives and reach audiences more precisely.

Share Data With The Creative Department

Data isn’t just for media buyers. Advertisers who use data only for targeting are leaving their job half done. Data can — and should — be part of the creative process. When advertisers let their creative teams see targeting data, the ad messages themselves become a lot more relevant, Lowenstern said. “Targeted media is good. Targeted media plus targeted creative is better,” he said at the Digiday Summit.

R\GA employed this strategy for Verizon’s FiOS service, using data to create ads targeted to 160 segments, including customers who had recently moved, purchased a new flat screen television, or had HGTV dropped from their cable network. Those ads, tested against a standard customer- acquisition ploy, increased FiOS orders by 189 percent, Lowenstern said. “When creative and media are using the same data, response rates go up, costs go down, and everybody is happy.”

Nudge Consumers Toward The Register

Digital marketers can blanket the Internet with acquisition banners all they like, but a customer who clicks once isn’t likely to click the same ad again. Instead, marketers should employ a strategy that moves potential customers further along in the process with tiered creative.

For example, a first step would be making your name and company known. Banner ads can serve that purpose well. Next, of course, you need to introduce potential customers to your product or service. Again, banners or a mix of advertising in various media will work. Finally, when it’s time to “close the sale,” you’ll want to find customers where they are and serve targeted ads (most likely, discount offers or other calls to action).

When you look at most consumers’ behavior, they do a search on Google when they are ready to make a decision,” said Sunil Gupta, Edward W. Carter professor of business administration at Harvard Business School, in a Forbes.com article in April of 2013iv “So search ads get all the credit for the sale. But search ads are at the bottom of the purchase funnel; display ads are at a higher level. Everybody in the industry intuitively believes that display ads drive people down the funnel, so they should get some credit—but they don’t.”

“Each part of the funnel should have a creative strategy,” said Emily Iverson, director of display advertising at Booyah! Advertising in Denver, Colorado.

Early impressions should aim to raise awareness and educate the customer with pricier, high-impact display advertising or product videos. Once customers have engaged, advertisers can follow up with simpler, less expensive banners. Finally, hit potential customers with more aggressive offers such as coupon codes and discounts in order to move them across the finish line.

Employ Content Strategy

Most often, advertisers think of content strategy as the add-on that enhances the big idea—the in-ad video, the onsite blog, the repurposed consumer review. However, by employing content strategy from the start, advertisers can ensure that they are speaking their customers’ language in their display ads, as well.

Content strategy is more than just building brand newsrooms and churning out content, said Sarah Krznarich, director of content strategy at Ethology in Phoenix, Ariz. It’s about knowing the audience first and making sure their interests are addressed in every part of the communications, from a web site to search terms to, yes, display ads.

Krznarich recommends employing an audience-and- research intelligence team to investigate what people are searching for when they search for the product. Do they look for “car insurance” or “auto insurance,” for example?

“If possible, I also like to look at a company’s website and see what’s working there,” said Krznarich. “The language consumers themselves use, as well as effective calls to action on your site, can and should be replicated in display ads.”

Once the audience’s interests and language have been determined, marketers should use that to marry their message architecture with their brand objectives, as articulated by key stakeholders.

Questions like, “Are you traditional or do you want to be seen more as sexy?” combined with a good editorial background will help advertisers determine the appropriate voice and vocabulary, which should inform display creative, said Krznarich.

Display campaigns should never be designed in a bubble, just as content creation should not be considered an add-on. The smart marketer will develop those twin pillars together.

Fish Where The Fish Are

When digital marketers think about context, they almost exclusively consider where their ads are appearing online. Direct buys ensure that ads appear in the right publications, while behavioral targeting ensures ads are finding the right buyers based on the specific actions they take across the web.

But smart marketers will also consider where consumers are logging on in the physical world. By employing information like geolocation, marketers can pinpoint potential customers in locations narrower even than a zip code, eliminating the waste that comes with wider buys like local television advertising.

For example, if national travel agency Liberty Travel wanted to push a Spring Break promotion to college students, it could buy ads on a site frequented by college students — perhaps CollegeHumor.com. But a large portion of that audience might consist of high school students travelling with parents, or working adults with juvenile senses of humor.

Drilling down, Liberty Travel might then want to narrow their target to college towns using zip+4, a step in the right direction that considers offline data. But then they’re getting everyone who lives and works in town, wasting valuable impressions. However, by using IP address-based location, Liberty Travel could target computers dialing up on campus IP addresses. Then, using cookies, they could behaviorally target those same users when they leave campus to return home.

Geolocation marketing also allows marketers to tailor ads to people in a specific industry, company or location, ensuring that even the creative message has real-world relevance.

Imagine a national jewelry boutique directing ads to high earners in Fortune 500 companies, Silicon Valley and Wall Street brokerages around Valentines Day. Or Crocs blanketing U.S. hospitals with ads for its shoes, favored by nurses and orderlies.

A Better ROI

Although both banner and TV ad success can be tricky to measure, banner advertising can represent the better ROI. Often, it costs less and delivers more.

Beth Ringer, director of digital and analytics at Blitz Media in Waltham, Mass., said, “Display is an extremely efficient channel, especially when compared to more traditional forms of advertising like TV, because display ads act in ways that TV ads cannot. We see higher ROIs with display advertising because it is highly targeted, interactive and measurable.”

Display, Ringer explained, “allows you to target a user or consumer based on their personal interests, geography, demographics, social activity and past purchasing behavior. An advertiser can choose to serve their ads on specific sites or to specific users.”

Ringer said that because display ads are interactive—that is, banners can be clicked, videos can be watched and almost everything can be forwarded to friends—they’re far more trackable and measurable than other types. “We know which ones received the most interest (via clicks) and which ads drove the most visits to the brand’s website.” That, of course, means “we can continue to make our ads more improved and efficient in the future.”

The Bottom Line

Display advertising might be the oldest on the Internet, but each year brings new ways to target audiences and drive higher engagement. Marketers today need to consider consumer sensibilities, move them toward the purchase with a tiered messaging strategy and use content strategy and data to tailor their message. Marketers who want to drive business from the top of the funnel down will consider smart, precisely targeted campaigns.

To find out more about how location-based and predictive behavior targeting can be used to improve your digital media effectiveness, contact Neustar at 1.877.572.4581, email onlineads@neustar.biz, or visit www.neustar.biz/online-ads.

Download PDF


i Comscore, February 14, 2013 “2013 U.S. Digital Future in Focus”
ii eMarketer.com, August 23, 2013 “Nearly One-Fifth of US Display Spending Will Be Automated This Year”
iii Bizo, July 16, 2012, “Why Investing in Top-of-the-Funnel Advertising Pays Off,” by David Karel
iv Forbes.com, April 15, 2013, “Search vs. Display Advertising: Which Promises More Bang for the Buck?” by Michael Blanding