Better Audience Targeting is Digital’s Key Priority

Brand safety was once the chief focus for digital advertisers, but now we’re seeing significant improvements in this area, advertiser priorities are shifting. The new challenge, driven by the phasing out of third-party cookies, is providing better ad experiences through more effective audience targeting. 

Xandr’s 2020 Global Relevance Report found that more than four in five consumers readily accept targeted and relevant advertising, so long as it provides access to the content they enjoy. So, the most important thing now is for brands to live up to half of the value exchange and provide engaging advertising experiences.

The further resounding support for the industry comes from nearly three in four (73%) revealing they see advertising as good for consumers and 71% who clarified they like it when adverts are well targeted to fit in with what they are watching, reading, or listening to.

So, if the experience is right, consumers are receptive to receiving targeted advertising in exchange for access to the content they enjoy. This begs the question of advertisers, how can they honour that understanding? What should they prioritise and which challenges need to be overcome?

Targeting disconnect prompts data investment

Digital marketers are very clear on where they need to focus. The problem is, when they compare where they need to be with current capabilities, there is a massive gap.

Reaching the right audience is the number one priority for four in five UK digital marketing executives. However, only 15% believe they achieve this effectively. The same applies to delivering effective creativity, which is the second top priority for 72% of UK digital marketers, yet only 21% believe they do it well. The UK also recorded the lowest effectiveness level for selection of media type, achieved by just under one in five marketers (19%).

With this level of self-awareness over the capability gap, UK marketers are investing heavily in the best technology and data capabilities to improve customer experience. 

Nearly all UK digital marketers, 97%, reveal they invested in data this year, compared to 79% in the US. The UK also led the way in hiring the right talent to back up this outlay. Nearly two in three (65%) of UK respondents reveal they have hired a data scientist compared to just over a third (35%) in the US.

The UK stands out on the measurement

Part of this high-level investment in data is likely to be focused on measurement in the UK. It was the only market surveyed which picked out this capability as its top challenge. 

More generally, across all the countries surveyed – the UK, France, Germany, US, Brazil, and Australia  – three main challenges were called out. Digital advertising executives agreed they need to create better ad experiences, despite media fragmentation and changing consumer habits, while also maintaining privacy compliance.

Although the UK stands out on measurement, the responses, as a whole, reveal how advertisers’ concerns have moved on from previous years when ad blocking and brand safety were major issues. Only France saw ad blocking enter the top three worries for advertisers in a report that clearly shows brands’ concerns have now moved on to delivering better advertising experiences while respecting privacy.

Privacy

This balance between respecting users’ data rights while still providing effective adverts features highly on digital marketers’ minds. It is hardly surprising given the impending loss of third-party cookies and Apple’s Identifier for Advertisers (IDAF) at some point in 2021, with the backdrop of established data privacy regulations like the GDPR.

Hence, nearly half (48%) of UK marketers reveal data accuracy and compliance as top concerns. This is echoed in the US where identifying audiences across different screens in a compliant manner is a concern for 41% of US marketers. 

These are more than concerns, of course. Such a fundamental change to how digital advertising works, requires marketers to rethink their approach to markets and, crucially, make additional investments in new tools. These need to ensure first-party data is fully optimised to allow digital marketing campaigns to work seamlessly across multiple channels.

In the UK, digital marketers point out they expect either their company or client will respond to losing tracking cookies by creating an effective identity solution (40%) as well as develop a more sophisticated tech stack (45%).

It is clear, then, that 2020 hasn’t turned consumers off advertising, they are still open to it, providing it’s in exchange for great content. The challenge is how to tap into this acceptance by providing better experiences that are still privacy compliant. While digital advertising executives admit there is some way to go to achieve this, the 2020 Global Relevance Report shows they clearly understand that improving audience targeting to deliver better advertising experiences is now both their top priority and challenge.