Digital is reshaping the world of advertising

Thanks to the proliferation of providers from Netflix and the BBC’s iPlayer to Facebook and Snapchat, consumers have greater access to more media on more devices than ever before. That is allowing advertisers to tap user data to target their messages precisely to the right people at the right time in their digital campaigns and, increasingly, through traditional media such as TV. The way advertising is bought, sold and created is being reshaped by the enormous volume of data from set-top TV boxes, credit card purchases, online profiles and retailer loyalty card programmes -- and by the technology that allows marketers to access, analyse and implement that data. While the rise of targeted advertising has been enabled by data and technology, its proliferation reflects marketers’ demand for evidence that the money they spend is really influencing customer behaviour. Targeting is also valued by marketers as they are under great pressure to show efficiency and make sure they are not wasting valuable ad dollars on people who are unlikely to be customers.

However, research suggests there are limitations to how far marketers should take targeting. Lisa Barnard, of Ithaca College, has found that online ads tailored to specific consumers do increase their intent to purchase items. But she also found a negative effect from what she calls “the creepiness factor” of targeted ads that reduces the likelihood to buy by 5 percent. “Even digital natives were bothered by this. They know they’re being marketed to. And they don’t like it,” she says. “Marketers have made blanket assumptions that the more data we have, the more we should use,” she adds. “But just because we have that information, it doesn’t mean you should just go ahead and use it all the time in all cases.”