With new EU regulations, especially the GDPR, targeting and tracking users became extremely difficult.
Every company, which I have talked to in the recent years and which claims it is still working, is basically actively breaking the law.
Starting with the EU, this is already spreading across other democratic countries, like even the US with the CCPA (sample source).
Long story short: It seems to be a hard time for marketeers.
Or isn’t it?
Thinking about it in detail, this is only bad news for a tiny part of the online advertising industry.
Companies, which focused on selling, brokering, or managing online ads, that are somehow targeted on specific user segments.
This is still no good news for them, but let’s face it: This market (mainly consisting of extremely good sales people) made us believe, it is the one and only new way of doing marketing — which it is not.
That is the reason, why those regulations are mainly hurting those, selling or consulting on ads; not so much the companies, using marketing to sell their products.
And therefore, it is not necessarily bad for marketeers — it is only changing some rules.
What to expect
In this article,…
- I am going to explain, why online targeting never fulfilled its tremendous promises;
- I will remind you of what marketing actually is and always was;
- I will show you how targeting can work without expensive, yet often useless, experts and tech, getting to even better results;
- and last, but not least, I will provide you with a small glimpse of how modern tech can still enhance marketing like hell.
Let’s get this started!
Online marketing “experts” hate this trick! 😉
Some inconvenient Truth about Online Targeting
Online Targeting basically promises you to show your ad only to a very specific group of people.
There are many reasons, why this is usually not working as advertised.
Here go my top 3.
Mind that this is not about search keywords (they are quite definite), but rather thinks like “age”, “gender”, “interests”, and more complex things!
1. Technical issues
Techniques to identify a user and/or at least assign him or her to a statistical segment have become extremely advanced. However, there is a big “but”.
Using tools like Google or Facebook Ads give you the feeling that you can make sure, only young men, 21 years old, with a butterfly tattoo on their right elbow, will see your ad. BUT, that’s not the case.
Each portal can only group users based on what they know about them.
- Facebook might know the age of John, because he put it on his profile.
- Google might be able to tell that Emma thinks about moving, because she recently searched many things for a specific new neighborhood.
You might already see the problems:
- John might not even be John, but actually his name is Paul and his birthday … well, it needs to say 21, because his ID does.
- Emma is not thinking a bit about moving, but her mother is. And yes, they share one computer.
From Facebook’s or Google’s perspective, there is nothing wrong here, but it still is not what the user expects when creating the ad.
In the end, there is not that much truth on the internet, than marketeers wish there was. This uncertainty increases with more and more people actively covering their traces.
You will still find people in your targeted segment, who fit the profile. But it won’t be a 100% match and you easily miss some potential customers.
2. Psychological issues
The respective companies made it so easy to target your ads to a specific audience, that most advertisers forget about optimizing the ad itself.
To the user, it is therefore usually quite obvious, why he sees the ad.
This triggers higher “persuasion knowledge”. It is not necessarily bad, if people do know about an advertising intent, but it is bad, if the marketeer is not aware of this dynamic.
The best example here, is creepy targeting.
Like an ad saying “You’re 21 and just moved to North Carolina, but obviously are still single? Try Tinder!”.
This leads to people feeling hacked and even makes them develop fear towards the ad and brand/product.
3. Legal issues
As said in the very beginning:
No matter if you see the problem with my first two issues, the whole area gets more and more regulated.
Unless you were using some NSA tech or worked with the Chinese government, it was already forbidden and impossible to target a campaign to specific individuals.
And it is, thank god, also forbidden for companies to surveil people in democratic countries.
You simply do not know, if Emma or her mother is actually using the computer right now.
Problem? Not if you remember some marketing basics. 💡
Marketing basics revised
When making use of Performance Marketing, marketeers tend to focus more on targeting and less on the ad itself (again, this is only partly true for search ads).
In my opinion, this is based on the way the whole Performance Marketing industry advertises its services.
To be fair, there is nothing wrong with this. Of course, Facebook points out its capabilities of slicing the ad audience based on user profiles. That’s their USP!
Marketeers, remember the basics!
Marketing, however, is an extremely broad area.
One major core discipline is the determination of a respective target audience and the creation of a marketing mix, which perfectly covers their decision-making process to finally get them to buy.
Targeting, the old way, works like this:
- We develop a new product based on some hypotheses or observations.
- We test it against the market.
- We come up with a final target audience (or multiple ones).
- We analyze this audience and develop a respective marketing mix.
- We develop ads, which support our story and attract this audience. Ads, that are so appealing, that it simply does not matter, if 80% of our viewers are not part of the target audience.
Seems logical, doesn’t it?
Now, think about how most behave with performance ads:
- We develop a new product based on some hypotheses or observations.
- We define keywords and rough audiences.
- We play some ads (not putting too much time into their design) and check the results.
- We define the final audience based on the result.
The big difference:
With performance ads, we trust that the system does the audience determination on its own.
As show in the previous chapter, this gets more and more biased.
So, if the system is no longer working, why not re-focusing on the old way?
Let’s change focus
Let’s think “audience first” instead of “ads first”!
Re-focus on advertising like it had been done by professionals before the time of non-eatable cookies. They got deep into consumers’ minds, creating the right ad for the right people.
Does this exclude Performance Marketing?
Absolutely not!
But it should change the way you approach it.
It is just one marketing channel, not the source and holy grail of your marketing strategy!
Starting your next campaign, you should start at the whiteboard and not at the Facebook Business Manager.
In the end, as tons of studies show, a mixture of channels and ads usually works best for almost any marketing strategy.
So, focusing on one channel is always a bad idea anyway.
When eliminating the benefit of targeting, even in terms of costs, some offline channels might become more attractive again.
Facebook tells you that it is cheaper, because of smart targeting. But if this is not working, TV could be interesting too (at least for larger budgets).
There is a reason why the most successful online sellers advertise on TV. 😉
How Technology is going to help in the Future
Some might mention that one huge benefit of online targeting and the respective process is the fact, that you can start small and then scale.
While this is only partly true (scaling is quite hard with Performance Marketing), they have a point here.
With the old way, you would need to have some market research to develop a good ad, before setting it live.
In the end, this is basically the same in terms of effectiveness, but way more complicated and expensive.
That’s the part, where modern tech can become helpful in the future.
Some years ago, I developed an AI software, which analyzed tons of historical data about branded content effectiveness to optimize it (and even TV commercials) — before the actual implementation and airing.
Using AI and Machine Learning to validate advertising definitely is a thing.
My software maybe was there some years too early.
With increasing regulation, and decreasing compute resources prices, those approaches definitely will become a thing in the future.
And in those times, it will be all about owning specific interest groups through strong, yet specific content. It doesn’t matter if you know the age of your users. They are there, because they love your content and this matches the audience of brand XYZ. With pre-optimized ads, strong privacy, and still strong advertising success.
Performance Marketing isn’t dead
One final disclaimer.
Performance Marketing isn’t dead, neither is online targeting! There are many cases, where it fits in quite perfectly and since it is quite expensive, you will always need to target your campaign somehow. But mind to think “audience first” instead of “ads first”.
And it is important to understand, that Performance Marketing as well as its sub category “Remarketing” are only marketing tools and channels, which should be part of your marketing mix, if it fits in.
They are not the “new way of doing marketing”.
Thinking of marketing the right way, it not only boosts your sales, but also your Performance Marketing efficiency. 🔥
