Optimizing Optimization
Be careful what you wish for because it may come true…
In the halcyon days of mass media, when a typical Prime spot averaged a 15 rating and a major magazine could reach one-fifth of the population, advertisers complained that their ad dollars were being “wasted”. We were reaching too many people – and paying for those impressions -- when we only wanted to reach our target audience. The cry of marketers was to cut out the waste!
Well, be careful what you wish for…
Media became fragmented and more targeted. Cable networks, magazines, and other media proliferated with narrower, more targeted content, and more targeted audiences. We went from broadcasting to narrowcasting. And advertising rates continued to climb. In television, top-rated programs commanded a premium price, even when the audiences of those top-rated programs trended downward. On a relative measure, they were still the best game in town. In magazines, economies of scale made the larger circulation publications more efficient than the smaller ones. With audiences scattering, there went the efficiency along with it.
As the price of “reach” continued to climb, even our concept of best practices changed. Unable to increase ad budgets to keep up with the increasing price of media, we lowered our expectations. A minimum 3+ reach goal became a minimum 2+ reach goal. Then we came up with the theory of “recency,” lowering our frequency requirements more. Coincidence, perhaps? Maybe…
Then we got the internet and – finally -- our prayers were going to be answered. Hallelujah! Soon we would be able to reach just the person we wanted to reach with no waste. We can target demographically, geographically, contextually, behaviorally – you name it and the magical internet could deliver! Well, not quite…The expectations of the internet, to-date anyway, have far exceeded its performance.
We’re not there yet, and now we’re a long way from the efficiencies of mass media. In hindsight, it wasn’t waste that we lost; it was bonus. It was the bonus audience that our media plans delivered above and beyond our targeted audience -- and the monetary value that bonus audience represented --that we lost. It was an important cushion that we lost. It was our ability to maybe be slightly wrong about our target audience yet still succeed because we reached enough buyers of our clients’ products with all of that, uh, “waste.”
Today, we don’t have the luxury of excess media impressions, whether you call them waste or bonus. Today, when we deliver an ad message to a media viewer/reader, we better be right about it. Damn right about it. That message has to reach exactly the right person at exactly the right time in exactly the right place, right environment, and right cost….or else.
Optimization is the order of the day. Are we there yet? Well, no, we’re far from it. While technology is increasingly moving us toward the ability to identify individual traits on which to target, privacy concerns continue to block the path of using that information. Our measurement of a web site’s audience is inadequate and inaccurate. While we may be able to estimate the composition of a site’s total audience, we rarely buy the entire site (nor would we want to – all that “waste” you know). And the demographic profile of the recipient of an individual impression on a particular site is still in most cases an educated guess at best. We’re stuck in the middle. We’re too far from the efficiencies of mass media, and too far from the accuracy of targeted media. Our target criteria looks as lame today as it did in the era of mass media. We can do better.
In this new decade, it will be interesting to see how optimization is optimized. Will we develop the skill to accurately measure each and every impression, identifying the individual who is on the receiving end of the ad (with their permission, of course), monitoring the effect we have (even getting feedback from our intended target), and adjusting our message, our delivery, and our timing appropriately? We better. We don’t have the luxury to make mistakes any more.
In the halcyon days of mass media, when a typical Prime spot averaged a 15 rating and a major magazine could reach one-fifth of the population, advertisers complained that their ad dollars were being “wasted”. We were reaching too many people – and paying for those impressions -- when we only wanted to reach our target audience. The cry of marketers was to cut out the waste!
Well, be careful what you wish for…
Media became fragmented and more targeted. Cable networks, magazines, and other media proliferated with narrower, more targeted content, and more targeted audiences. We went from broadcasting to narrowcasting. And advertising rates continued to climb. In television, top-rated programs commanded a premium price, even when the audiences of those top-rated programs trended downward. On a relative measure, they were still the best game in town. In magazines, economies of scale made the larger circulation publications more efficient than the smaller ones. With audiences scattering, there went the efficiency along with it.
As the price of “reach” continued to climb, even our concept of best practices changed. Unable to increase ad budgets to keep up with the increasing price of media, we lowered our expectations. A minimum 3+ reach goal became a minimum 2+ reach goal. Then we came up with the theory of “recency,” lowering our frequency requirements more. Coincidence, perhaps? Maybe…
Then we got the internet and – finally -- our prayers were going to be answered. Hallelujah! Soon we would be able to reach just the person we wanted to reach with no waste. We can target demographically, geographically, contextually, behaviorally – you name it and the magical internet could deliver! Well, not quite…The expectations of the internet, to-date anyway, have far exceeded its performance.
We’re not there yet, and now we’re a long way from the efficiencies of mass media. In hindsight, it wasn’t waste that we lost; it was bonus. It was the bonus audience that our media plans delivered above and beyond our targeted audience -- and the monetary value that bonus audience represented --that we lost. It was an important cushion that we lost. It was our ability to maybe be slightly wrong about our target audience yet still succeed because we reached enough buyers of our clients’ products with all of that, uh, “waste.”
Today, we don’t have the luxury of excess media impressions, whether you call them waste or bonus. Today, when we deliver an ad message to a media viewer/reader, we better be right about it. Damn right about it. That message has to reach exactly the right person at exactly the right time in exactly the right place, right environment, and right cost….or else.
Optimization is the order of the day. Are we there yet? Well, no, we’re far from it. While technology is increasingly moving us toward the ability to identify individual traits on which to target, privacy concerns continue to block the path of using that information. Our measurement of a web site’s audience is inadequate and inaccurate. While we may be able to estimate the composition of a site’s total audience, we rarely buy the entire site (nor would we want to – all that “waste” you know). And the demographic profile of the recipient of an individual impression on a particular site is still in most cases an educated guess at best. We’re stuck in the middle. We’re too far from the efficiencies of mass media, and too far from the accuracy of targeted media. Our target criteria looks as lame today as it did in the era of mass media. We can do better.
In this new decade, it will be interesting to see how optimization is optimized. Will we develop the skill to accurately measure each and every impression, identifying the individual who is on the receiving end of the ad (with their permission, of course), monitoring the effect we have (even getting feedback from our intended target), and adjusting our message, our delivery, and our timing appropriately? We better. We don’t have the luxury to make mistakes any more.
posted by Rich Miller at 8:38 PM
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