Online advertising has been touted as one of the best ways for advertisers to reach the specific target markets they are after. Ad networks and publishers promote to advertisers that they have multiple methods of helping them get to the precise prospects and customers they are seeking, whether it be via demographics, geography, behavioral, contextual or other targeting techniques.
But findings released last week by Nielsen call these claims into question. Nielsen’s research is showing that the targeting capabilities of online ad campaigns are typically no more precise than targeting results achieved by traditional TV campaigns.
Nielsen Online Campaigns Ratings system was introduced in September 2010 as a new way to measure audiences of online ad campaigns by “combining traditional Nielsen TV and online panel data with aggregated, anonymous demographic information from participating online data contributors. Using its unique approach, Nielsen will be able to provide reach, frequency and Gross Rating Point measures for online advertising campaigns of nearly any size, running nearly anywhere on the web.”
Nielsen has used the system to assess approximately 40 campaigns for over 20 brands. Having aggregated data from million of internet users, it is yielding a higher sample coverage than average, at 42%. A larger sample size infers a greater accuracy in the results.
So, let’s look at the recently announced findings. According to Nielsen, “an analysis of the campaigns showed that when comparing campaigns with narrow audience (less than 20 year age span or age + gender) vs. broad audience (greater than 20 year age span), narrowly defined demos typically delivered 30 percent on-target vs. 77 percent for broad.” For companies that have been spending thousands, or even millions of dollars advertising online, this preliminary discovery should get their attention immediately.
The study also concluded that “Age + Gender-specific campaigns exhibited the highest delivery outside of the desired audience (27% for age + gender vs. 75% for general).”
This means that companies that want to reach women within specified age brackets through online advertising are either having their offers viewed by women outside those ranges, or by men a whopping 72% of the time! The mistargeting is one percentage worse for advertisers marketing and selling to men online.
What is to be made of these findings? First off, this is a new methodology and it will be in beta until mid-summer. Like any company debuting a new product, Nielsen wants to make a big splash with its introduction and unexpected findings get attention. Also, Nielsen has not publicly stated whether the bulk of the campaign analyses were done on SEM, Facebook or other types of ad platforms. This would be helpful to know, as some platforms are going to be more accurate at targeting than others. A portion of the mistargeting can likely be attributed to non-cleansed databases filled with bogus user data intentionally provided inaccurately by people or spambots.
No matter, Nielsen’s early findings are provocative. They should prompt marketers to take an even closer look at the effectiveness of their online campaigns and to demand highly accurate and verifiable analytics from their agencies, ad networks and publishers.