Thursday, August 6, 2009

Too much of a good thing?

We’ve always thought of targeting as a good thing. For example, as marketers, we first identify our target audience, this includes demographics and sometimes psychographic features, and then we go after these audiences with messages that we think will appeal to them. Choosing where to place these messages has always been a big part of whether or not the campaign would be successful. And, ad dollars being what it is these days, media placements are even more thought about and streamlined. Just read a very interesting article from the NY Times about a new branch of Mediabrands, called Geomentum, that will “figure out how to divide ad dollars among the almost 40,000 ZIP codes in the United States, sometimes zeroing in on even smaller areas, like a city block”. This (and copious amounts of caffeine) just got me thinking: is this kind of hyper-targeting really a good thing? Can zeroing in too much be potentially limiting?

To start off, here’s a quote from the article:

“In a simple example, a company selling drugstore makeup for Asian women ought to advertise in neighborhoods where lots of Asian women live, and not bother pitching its products in neighborhoods heavy on white men. Once Geomentum narrowed down where Asian women lived, it would then analyze how a billboard in the neighborhood performed, versus a newspaper ad, versus a dollar-off coupon, by writing a long equation that linked store traffic and local product sales with all those variables”.

This may seem pretty logical at first, if this company’s target market is Asian women, why would they want to spend their money in a neighborhood full of white men? However, I couldn’t help but wonder…

True, putting the ads in an Asian-women-heavy neighborhood may save money, but it also puts the brand in a corner. For example, if the brand exclusively promotes its products in Asian women-heavy areas, then it may be seen by the general population as a niche product, one that only works for Asian women. This may prove to be problematic for company growth and diversification in the long run.

Also, as a brand, you can simply never know what someone is thinking when they see your product. For all the aforementioned company may know, the neighborhood full of white men may contain 20% Asian women – in the roles of girlfriends and friends. In this increasingly diverse, social, and integrated world, one can’t draw simple conclusions based on zip codes anymore.

So I think this whole super micro-targeting thing is good for the short term, as it may give brands a higher return, but as it always is the case, successful brands need to balance the short and long term benefits, and really think about how every move will impact the brand perception and value to its consumers. Much like the concept of sales and discounts, this super micro-targeting technique may help in the short term, but what about its value in the long run? Done right, this may be a valuable part of the campaign, but if brands relied too much on this, they may find themselves spending more money to fix their images.

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