Targeted advertising is a method of online promotion that allows for displaying advertisements to a specific audience with predetermined characteristics on social media, websites, or apps. In simple terms, the word “target” means goal. Thus, targeted advertising refers to advertisements that are directed at a specific segment of the audience.
Based on publicly available information, the system creates a group for ad display considering the set criteria. For example, advertisements for sports gear and camping equipment can be shown to men aged 30 to 45 who lead an active lifestyle. Reminders can also be sent to users who have shown interest in products on your website but have not completed their purchase. Targeting helps in selecting the right audience and showing them relevant offers.
Objectives and Tasks of Targeted Advertising
Understanding the objectives and tasks of targeted advertising can assist a business in deciding which goal to pursue in a specific campaign. Targeted advertising aims to achieve the following goals: brand engagement, purchase of products/services, and involvement in brand communication. The primary tasks of targeted advertising in social media and sites include:
1)Increasing brand awareness — targeted ads can be shown to users with specific characteristics important to the brand;
2)Enhancing interaction frequency and quality with consumers — targeting allows interaction with users familiar with your brand;
3)Increasing sales and achieving marketing KPIs — targeting is used to create performance-based campaigns;
4)Direct contact with the target audience — targeted ads are shown to audiences interested in the product or service;
5)Finding and comparing different audience segments — targeting allows the creation of small user groups to compare the effectiveness of advertising for each.
How Targeted Advertising Works
How does the system choose the target audience, and where does it get information about potential clients?
To understand targeting, one must comprehend the functioning principle of the tool with audiences. When users register on VK services or social networks, they fill out a questionnaire and consent to anonymized data collection for advertising purposes. They provide their gender, date of birth, marital status, residence, and education details to create a primary public information database. Users demonstrate their interests by interacting with platforms, like subscribing to groups. Apps collect location data with permission, enabling targeted advertisements for residents or recent visitors of a locality.
Contextual ads and blocks work with already formed demand and are shown to users who made product-related searches. Targeting can work with both existing demand and create interest in audiences likely to be attracted to the offered product.
Targeted vs. Contextual Advertising
Differences
Both contextual and targeted advertising use AI technologies to display ads to various audiences, depending on advertising goals — either broad for reach or relevant for potential purchase or application. The mechanisms constantly evolve to ensure optimal results for your advertising. The primary difference lies in how they accomplish their objectives.
Targeted advertising relies on consumer data and online behavior, placing ads considering this information. For example, if a user over 18 frequently visits car websites, one might infer interest in buying a car. Targeted advertising can then show ads for a dealership or specific models when users browse the internet or social media. This approach captures the appropriate audience’s attention and fosters demand.
Contextual advertising focuses on web page content, effective when you lack potential audience data, displaying ads on pages most aligned with your product niche and in search results for relevant phrases. Contextual ads for a new car model can appear on automotive review sites where potentially interested users are present, or promote your dealership site atop search results for “buy a car,” giving access to audiences with existing demand — users from search engines and sites fitting certain search queries.
Therefore, the key distinction between contextual and targeted advertising is that targeted campaigns display ads to potential clients based on behavior, age, and demographics across resources, including social networks. In contrast, contextual campaigns show ads to those inputting specific search queries or visiting a promoted site through these keywords.
Advantages and Limitations of Targeted Advertising
Any marketing tool has its peculiarities. Understanding the pros and cons can streamline and optimize ad campaigns.
Main advantages of targeted advertising:
1)Display only to the target audience. Numerous setup parameters (gender, age, demographics, geolocation) enable forming a precise client portrait. Access to an
interested audience likely to respond to the offer.
2)Ad personalization. Segmentation boosts ad effectiveness, incorporating visuals, headlines, and descriptions — creating relevant content for each group
with a direct user issue address, distinguishing the ad amidst other content.
3)Easy hypothesis testing and rapid optimization. Testing guarantees ad success. Ad statistics promptly display in the dashboard, allowing for tracking effective proposals or audience works to enhance effectiveness through immediate campaign setting changes, optimizing displays and budget.
4)Simple client acquisition. MyTarget promotion doesn’t require social media groups or large budgets. Tools can pinpoint competitors’ audiences, community subscribers, or users with specific interests, aiding in swiftly finding your target audience, facilitating product marketing.
Types of Targeting
Targeting defines criteria for selecting users a business aims to sell products or services to. Audiences can be configured based on:
1)Demographic metrics: gender and age. Crucial to avoid displaying ads to uninterested individuals.
2)Geotargeting. Select audiences frequently visiting or recently at a certain location, critical for promoting a physical retail point by choosing nearby potential clients.
3)Behavioral and social characteristics: income level, education, marital status, etc., to consider user actions.
4)Interests gathered by ad systems based on user activities. For instance, selling car parts through choosing people interested in specific brands, personalizing ads accordingly.
5)Contextual targeting, enabling promotion via search queries. For example, if a user recently searched refrigerators, they can see related ads.
6)External segments involving DMP platform data to expand reach or identify hard-to-access audiences.
7)Remarketing shows ads to users who previously interacted with your company (via website, app, retail point), stimulating repeat sales by uploading user lists (phone numbers or emails) for ad display, utilizing dynamic remarketing for individualized ads showcasing previously viewed products.
Common Errors in Targeted Advertising
Overestimating or underestimating bids can quickly deplete budgets or fail to reach audiences.
Avoid unnecessary audience restrictions losing potential clients, and refrain from multiple simultaneous targeting.
Lack of segmentation requires dividing wide audiences by gender, age, interests, and other parameters to tailor advertising proposals.
Ineffective creatives must captivate potential clients by highlighting products’ attractive sides and benefits.
Poor creatives yield no results.