Advertisers plan to ramp up audience targeting budgets- survey

Industry confidence in audience targeting is on the rise, with 84.8% of agencies and 76.3% of advertisers currently use audience targeting, according to a new study.

The survey, conducted by AudienceScience and DIGIDAY canvassed more than 500 media executives from advertisers, agencies, and publishers.
US “Audience Targeting: Mapping the Future Evolution of Audience Targeting and Data Management” survey found that most stakeholders in the digital advertising ecosystem will witness increased revenue or spending in the arena, and that audience targeting is among the main drivers of these gains.
Of those advertisers that currently employ audience targeting plan to increase their digital ad budgets by more than 72% during 2011. This estimate is double the projected increase for 2011 as reported in May 2010.
In addition, publishers that employ targeting have seen a dramatic increase in display ad revenue and predict an over 45% budget increase compared to May 2010.
Publishers cited delivering better performance and ROI for clients, acquisition of new customers, and the ability to sell more inventory and at a higher CPM as the primary benefits of targeting.
Over 50% of both advertisers and agencies reported that the budget spikes are justified by the more effective results realised by audience targeting. Agencies cited better measurement impressed budget planners, while advertisers felt that greater reach of target market where reasons why audience targeting causes display ad budgets to increase.
“In the US there appears a direct correlation between the growth in display budgets and the use of audience targeting. This is clear and unshakeable evidence that audience targeting represents the core of effective online display campaigns. The recent IAB/PwC online ad spend survey highlighted a 27.5% growth for display advertising and I believe a factor in this increase will have been better targeting.
For advertisers and agencies, it is simply the most effective and efficient way to target your audience while for publishers, it consistently helps drive more revenue.” comments Stuart Colman, Managing Director, Europe, AudienceScience.
Of the respondents that intended to decrease their audience targeting budgets, 24% claimed it was because Audience Targeting was so effective that they were able to reach target audiences at a lower cost.
“Those US advertisers and agencies who are able to reduce audience targeting spend are a clear example of how once you effectively plan and implement your targeting, budgets should work harder as you reach your intended target audience more efficiently and cut out wastage,” continues Colman.
An interesting paradox the survey results identified was around measurement. While advertisers look to audience targeting to increase brand awareness, agencies are still thinking of “targeting” in terms of direct response. This may be linked to a greater desire by brand marketers to embrace online advertising and a focus on using metrics relevant to them.
The research also highlighted audience targeting is expanding to new forms of digital media consumption such as the hot areas of mobile and streaming video.
The complete results of the study are available online. http://www.audiencescience.com/future-evolution-audience-targeting
www.AudienceScience.co.uk