How to minimise wastage and leverage audience data for advertising campaigns
The other day I heard that an acceptable click-through rate for banner ads was between 0.10% and 0.30%, and that this was common in the industry. This shouldn’t be a surprise to marketers. You only have to spend a few minutes browsing online to know that there’s poor placement and relevance of banner ads.
In this blog, I’ll run through quickly about why this is happening, what marketers can do about it, and how to leverage audience data to stop wastage.
Waging war on wastage
The numbers show that banner ads fail to hit the mark a lot of the time. Meetrics reports that an estimated 42% of digital banner ad spend was wasted in Q2 2018. Similarly, the IAB in Europe together with Nielsen estimate 48% of online ads didn’t reach the people they were aiming for.
Brands have taken notice too. In 2017 Procter & Gamble cut more than $100 million in digital ads. In the same year, JPMorgan Chase reduced the number of sites its ads appeared on from 400,000 to 5,000.
Hope is not lost though, I do believe that there three key ways marketers can minimise wastage.
Buy ad space with high viewability ratios
Ad viewability is the concept of how visible ads on a website or mobile app are to users. According to the IAB standards, a viewable impression only counts if at least 50% of the banner or creative must display on screen for more than one second.
As a marketer, I would be conservative and assume a fair percentage of your display ads won’t be seen, even though you will pay for them. When considering the publishers you advertise with, keep this in mind, and remember that a high ROI correlates with improved viewability. Ensure you research how the display ads are served across devices, and that as much as possible is being done to ensure that your ad will be seen.
Buy inventory from trusted sources
Don’t buy fraudulent traffic. Scrutinise the ad impressions you buy and only buy ad inventory from trusted sources. Some tools that help with this include third party audience measurement sources like Google Analytics and Narratiive. It is worth verifying the numbers you are shown in media kits and sales pitches.
Use audience data for a targeted approach
Audience data is information about the people who respond to your advertisements and buy your business’s products or the people that visit your site. It’s becoming more and more common to leverage audience data to target consumers by demographic, behaviour and intent.
Let’s focus on audience data, since it is what we specialise in here at Narratiive.
Using audience data for advertising
First thing’s first – all South African institutions must comply with the Protection of Personal Information Act. At the very minimum, I recommend ensuring you are compliant, and then work towards GDPR compliance too, which will eventually be adopted worldwide as best practice for data privacy and security.
There is a bigger emphasis on the collection, processing and storing of customer data nowadays, and the onus is on brands and businesses to be responsible and respectful. In turn, I do believe that we will see better conversions across the board for with ethical and ‘white-hat’ marketing practices.
Understanding the different types of audience data
Firstly, audience data is only useful if you have built out accurate customer profiles. There are three core types of audience data you can leverage for your marketing.
First party data
This is your own customer data from customers that have either subscribed to your mailing list or made a transaction with you. The best way to use first party data is to remarket previously viewed products or market new products and services to your existing customers.
The biggest challenge will be to keep the data clean and updated. Often this requires substantial investment in expensive CRM software and data management platforms like Salesforce, BlueKai and Lotame.
Second party data
This is data that you acquire through B2B partnerships e.g. a car brand may pass on the details of new car buyers to an insurer. Assuming you have explicit customer consent, this is very strong data for new business as you know there is in-market intent and trusted referral.
It goes without saying that you need to pick your data partners very carefully and be sure the partnership uses the data in an ethical way.
Most important of all, be sure you have the customers consent for that data to be shared between companies and for them to be contacted by both companies.
Third party data
This is data that you acquire from external sources like Google, Facebook and us – Narratiive. Companies like this collect audience data and generally require no tech or license fees, and just a simple pay per usage model.
Third party data is best used for broader marketing to a wide pool of profiled potential new customers.
It’s important to know how third party data providers collect their data. Understand where this data comes from and make sure you trust that it is accurate and clean. This ultimately comes down to inferred data versus collected data.
Companies that put data at the center of the marketing and sales decisions improve their marketing return on investment by 15 – 20%.
McKinsey&Co – Big Data, Analytics, and the Future of Marketing & Sales
Achieving better ROI using audience data
Audience data allows you to have a personal conversation with each of your customers. Create multiple detailed customer profiles, customise your ads for each one and test out using different types of data. You don’t have to invest in expensive tech to start. Start simply and test the waters before dedicating more of your budget to expensive tech.
Your marker for success is seeing lower costs per acquisition, and a higher ROI of your marketing budget. Good luck!
The author of this article is Greg Mason, Narratiive’s Regional Lead for Sub-Saharan Africa. Greg has over 10 years of digital marketing experience in both the publisher and advertiser sides of online advertising.. After running his own media agency for four years, Mason Media merged with AddSuite, the fastest growing digital ad sales house in South Africa. Greg has worked as the lead commercial strategist for large international publishers like MSN, BBC, CBS Interactive, Sky News, Sky Sports, Daily Mail, TeamTalk Media, Times Live, Career Junction and various other leading local South African publishers.