It’s no longer sufficient to simply focus on product, brand, media or channel. Customers are the center of today’s marketing conversations.
In 2011, broadcasting will migrate to narrowcasting, enabling advertisers to reach desired audiences, and just them, when, where and how they choose. These narrowcast audiences will be multi-dimensionally defined across shopping, purchasing and attitudinal behaviors.
I came across research recently that analyzed a billion dollars in ad spending and found 37% of that budget is wasted. Marketers are searching for improved return on investment, while realizing traditional marketing models are broken.
The good news is that a new paradigm is emerging. Increasingly, addressable media means knowing who is consuming the media, not guessing. Media that once traded in broadcast terms, targeting general demographics, can now be purchased by specific audiences. For savvy marketers, this can improve the return on investment they seek.
Broadcasting is a strategy based on reach. Marketers send the message out to a large audience and hope that a portion of that message reaches the target customer.
With a broadcast approach to banner ads, marketers find websites with relevant content and demographics to match their top prospects. Targeting or segmentation selection is limited at best. The marketer relies on the publisher’s data regarding that website’s visitor profile when the banner is displayed.
Narrowcasting is the paradigm that enables marketers to leverage their customer insights to best reach their most desired audiences, getting their message in front of just those valuable prospects with greater certainty.
With a narrowcast approach, marketers target the customers that they want to see a banner ad without specifying which site must deliver the impression.
This stragegy allows marketers to leverage the intelligence and insights that have gone into developing extensive customer and prospect databases for new media channels. Identifying high-prospect segments online and presenting them with targeted offers has been shown to improve return on invesment eleven-fold.
It also means that marketers would be well served to shift up to a third of their marketing budget from broadcast marketing activities to a narrowcast approach. In this way, they can leverage the extensive consumer insights with responsible publishing partners in a privacy-assured manner.
In this model, advertising reaches and engages desired audiences across media, and just them, enabling marketers to focus on the most valuable relationships.