$700bn delusion: Does using data to target specific audiences make advertising more effective? Latest studies suggest not
July 22, 2024
Ever wondered how come martech is a US$700bn industry, but the ads you see are still crap? Clue – it’s because the data foundations are crap, says Brand Traction’s Jon Bradshaw. Following former UM privacy chief Arielle Garcia’s takedown of the “garbage” data broking sector, Bradshaw challenges industry to provide proof that data-driven targeting actually makes advertising more effective – or in fact makes it worse. He’s spoiling for a debate – and has three deep, recent studies that show: broad reach beats targeting for incremental growth; that the cost of targeting outweighs the return; and that second and third party data does not outperform a random sample. First party data does beat the random sample – but contextual ads massively outperform even first party data. And they are much, much cheaper. Now, says Bradshaw, let’s see some counter-evidence from those making a killing.
Advertising, wrote Ethan Zuckerman in 2014, is the Internet’s Original Sin.
But, its opponents will argue it’s given us a whole world of content and ideas, that we don’t have to pay for. And enabled a whole new kind of DTC (direct to consumer) business on social media platforms who target exactly the customers who they design their products and services for–that’s great for the little guy no?
But does targeting even work? Not everyone thinks so–and some bring receipts.
