You work with Performance Marketing at a brand (this is usually not for agencies)?
Welcome to a short online targeting fact check.
Myth 1
It is a new way to magically identify a specific person and his/her wishes.
What you can do with cookies, digital fingerprints, and the help of statistics:
You can identify a specific machine (PC, Smartphone, …) and make some assumptions on how the average person behind it ticks.
Sure, the deeper you go, the closer it gets to the actual person.
This is especially true, if you are providing information about yourself on the web.
- If you are telling Google that you are 20 years old, Google knows it.
- If you are filling out some psychological quizes like “Are you a cat or a dog person”, the hoster of this quiz can create some kind of psychological profile of you.
Of course, if you are going into creepy intelligence/blackhat tech, you will be able to surveil people in every detail of their life — luckily, this is not allowed in most countries.
So, it is mainly about statistics, not some magic wand, which lets you hack other peoples computers.
Talking about statistics:
Everyone, who has ever conducted a real high-class psychological study, knows that even a deep observation can mean nothing in another situation.
If this “cat person” was in a bad mood while doing the quiz, it migh behave like a “dog person” one day later in a good mood.
Bottom line:
Yes, it is easier to target your ad to a specific user group online.
And yes, you can create profiles of user groups.
But it is still far away from perfect, nothing completely new (you can do similar with print magazines), and in most cases not allowed any longer.
Myth 2
The better you target, the more successful you are.
This depends on your definition of success!
Performance Marketing is usually not that cheap.
So, you start optimizing it by focusing on those situations and user segments, which are most promising.
This usually works to a specific degree.
Let’s compare this to a local store, where you pay 1 dollar for every person, who enters it.
Imagine you ask people at the entrance, if they really want to buy. And then only let them in, who answer “yes” within 2 seconds.
This pushes your conversion rate and keeps costs low.
As long as your store is full of people, it works fine. But maybe it is not 100% filled or you expand, because it is running so well.
In the end, you leave out people, who would buy, but did not answer within those 2 seconds.
And when you want to scale, you need to let them in too, which breaks your initial targeting and increases costs.
Alexej Habinski wrote a nice article about his related experience in multiple great digital companies here.
In the end, this “targeting” only limits the costs of your Performance Marketing measures, it does not optimize your marketing strategy and therefore fails at scale!
It is not wrong, but too expensive at scale.
Myth 3
You can identify your target audience from ads analytics.
Some start with doing some Google Ads, checking the analytics, and then derive their target audience from this.
Long story short:
This is similar to the previous myth.
You are limiting this one specific channel, but missing out the other 90% of the world and your potential customers.
Again, it is not wrong, and works at first.
But it is not working when scaling or if you are managing an already large brand or product.
Myth 4
It is cheaper and you know what you pay for.
Sales people from the industry tell you that you save a lot of money, because you can target it so well, that you know exactly what you pay for.
No, you don’t.
In theory, this would work, but it does not in reality.
Proof me wrong by showing my a large scale campaign with a 100% conversion rate and positive ROI!
Yes, you have many opportunities to fine-tune your campaigns and you absolutely should do so!
But in the end, it is very misleading to compare this one channel against others in general.
If you throw 1 million into targeted Facebook Ads vs. 1 million into smart TV ads (where you focus on special interest niche slots), can you be sure who would win? I have seen proof for both. Of course, you have more statistics at Facebook, but after all, there is only one, which really counts — absolute sales.
It might be better to run online ads for some, but bad for others.
Generally, it is almost always a bad idea to go for one marketing channel only. It should always be a mixture.
