The Dangers of Retargeting

In Today’s Digital Ad Space, Don’t be Ned Ryerson

I think that digital marketing is broken. Seriously broken. Yet, we’re so accustomed to our wrongness, we don’t see it anymore. So, consider this an intervention. To me, here’s what digital advertising looks like today.

I hate to break it to you, but today’s digital ad space is Ned Ryerson. You’re that guy. Socially inappropriate, constantly harassing, totally uncool. Please stop.

What do we get right? 

Targeting. We know who we’re trying to reach, and we’re spending nearly all our focused efforts on how to reach that target with the least amount of waste. That’s a good idea and we should continue those efforts. Yet, I believe we are overemphasizing this goal as we have reached the point of diminishing returns. Each of the nearly 7,000 martech vendors are trying to eke out 0.1% or 0.2% of efficiency gains. Yet, the next digital marketing war will be won not on who marketers target. The demographic targeting war is your father’s war. The next war will be fought elsewhere – on receptivity. On when. And where.

Where can we improve?

The cautionary tale of Ned Ryerson is one of context: of time and of place. It’s all about receptivity. It’s not that Ned hasn’t reached the prospect, but the manner with which he’s reached him. We all can relate to the Groundhog Day scene. We’ve all been there.

  • Phil is a bad target buyer. Just because Phil fits a demographic profile (age, income, etc.), it doesn’t mean he is likely to purchase insurance. In fact, if you know the whole movie, he’s a loner, isn’t married and has no heirs. Why would he need life insurance? Who’s the beneficiary? He’s what’s called a non-buyer. At a minimum, he wouldn’t be considered “in-market.” Digital advertising does this a lot by marketing to certain sets of demographics without understanding who’s actually in-market. Conceptually, retargeting is designed to fix this problem somewhat (but has many problems as we’ll see).
  • Ned disrupts Phil while Phil is off doing something else. The pitch is both unexpected and unappreciated. Marketers do this all the time in digital advertising. We try to disrupt prospects while they’re happily doing something else. We falsely believe this disruption will create both a positive surprise and a positive perception. Neither is likely.
  • Phil doesn’t want to hear the pitch and tries to leave.  Ned follows him anyway – totally insensitive to the unreceptivity of his target listener.  Regrettably, remarketing has taken this exact concept to new heights. Most companies now stalk shoppers all around the web with ads that follow them wherever they go online. A majority of shoppers hate these ads and they discourage shoppers 10X more than they encourage them to buy. Ten times. That’s a lot. Yet, advertisers still use it. Also, a lot.
  • Ned continues to repeat his pitch – even though receptivity is low. We all know that if a shopper is not interested in a given product (at a given time), more messages make their feelings about the brand worse, not better. If we hound people 2-3 times after they leave our site, we’ll annoy about two thirds of them. Show the ad over 3 times and they move from annoyed to angry. Advertise more than 10 times and all the customer feels is rage. What do we get in return? Only about 2-3% of shoppers become motivated. What’s worse is we measure the improvement of the 2-3% and consider it a success, forgetting the 60-70% (or more) who now officially hate us.
  • Ned talks about himself. It’s all about Ned. How Ned is taking every opportunity. Digital advertisers act the same way. It’s not about what’s important to the shopper. It’s not about what the target wants – it’s about what the advertiser wants. It’s about what Ned wants.

What’s the new war we need to fight? It’s called receptivity. It’s not “who” you sell to, but where and when and how.

What is Receptivity?

Receptivity is a social concept. It’s connecting with shoppers during the moments in time when the shopper actually wants to learn. It also usually happens in specific places, too. When receptivity is high, the shopper is in a buy-ready moment. They want to see your content. Catch them then and you’ll be amazed at what you can achieve. Ads are fine as long as the timing and location are right.

Here’s an example:

Notice there is only one time the shopper wants the ads – during the research phase. During that time, they are highly receptive. After that, they are not. Everything from then on is a net negative experience for the shopper.

Why do advertisers get this wrong?  Because they only look at the orange bars.  “See, you can encourage 4% of shoppers if you remarket on unrelated sites. Isn’t that great?” They aren’t looking at the net scores:

  • During research: 45% net positive
  • After research: 3% net negative
  • After purchase: 27 net negative
  • On unrelated site: 41% net negative

So, to sum up. Ads are fine. But, where’s the consumer’s needs in this story? If you are delivering ads when and where audiences are receptive, you’ll do well. Forget that and you might as well be Ned Ryerson

Clip: Groundhog Day ©1993 Columbia Pictures Corporation