IPA Report: Are mass audience ads more effective than building targeted relationships?

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Jasper Jackson, TheMediaBriefing Experts' Blog, Advertising

Should advertisers stop spending so much time obsessing over audience targeting and building "relationships" with consumers?

That appears to be the message contained in the preliminary findings from the Institute of Practioners in Advertising's (IPA) "Advertising effectiveness: the long and short of it" report, which will be published in full next year.

According to the report's authors:"The vast majority of people have better things to do with their lives than to form deep and meaningful relationships with brands. Advertisers should not chase loyalty from customers but should speak to as broad an audience as possible and do so over the long-term.

"Obsessing solely about short-term sales is self-defeating; brands must be in it for the long-term as that is where the greater success lies. TV is particularly effective for long-term success.”

They are basically claiming that short-term, sales-focused campaigns are less efficient than large-scale campaigns aimed at the biggest audience possible. 

They also say that targeting, even based on a divide as simple as new and existing customers, is less efficient than mass campaigns. 

The below graph shows the comparative number of "very large effects" - such as increased profit, sales or market share, or a reduction in price sensitivity - that were generated by different approaches to targeting - or not targeting at all. 

At face value, the findings seem to fly in the face of the growing online orthodoxy around the value of carefully focused campaigns assessed on the actions they produce.

The most effective form of advertising, according to the IPA, is long-term and with broad appeal, and brands should be spending 60 percent of their budget on such campaigns.

The good news for publishers? It provides a compelling argument for convincing ad buyers they should be signing those long-term space deals for prominent placement on your site or in your magazine, rather than relying on ad networks and programmatic buying.

The bad news for (most) publishers? Well according to the report, TV is by far and away the most effective medium for delivering those mass audience ads - as you can see below.

There are however, a couple of things to take into account when looking at the report's findings.

First off, mass audience brand campaigns and direct sales-focused ads affect different parts of the purchasing process.

As the IPA itself says: "Advertisers need to ensure their campaigns strike the right balance between long-term investment in brand-building using mass media, and short-term, direct methods that stimulate sales. Campaigns that use both in harmony are more effective, more efficient and more profitable."

Second, the IAP report is based on data from 1,000 brand campaigns stretching back over 30 years.

Over that time, buying habits have changed radically. It's only in the last ten years or so that consumers have switched wholesale to researching and buying online, where ads targeted carefully at a point closer to the actual buying decision have more impact. A study focussed on just the last decade might throw up some very different findings.

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