Targeted advertising

Targeted advertising is a form of advertising that focuses on certain traits of the consumer, these traits are based on the product or person the advertiser is promoting. They are located in areas where consumers with those traits are likely to come upon. These traits can either be demographic which are focused on race, economic status, sex, age, level of education, income level and employment or they can be psychographic focused which are based on the consumer’s values, personality, attitudes, opinions, lifestyles and interests. They can also be behavioral variables, such as browser history, purchase history, and other recent activity. Targeted advertising has proven to be beneficial for the advertiser as it is cost efficient because it is focused on certain traits and the consumers who are likely to have a strong preference will receive the message instead of those who have no interest and whose preferences do not match a product’s attribute this eliminates wastage.

Advertising is one of the most important decisions a marketer makes and media purchasing is the most expensive of all advertising spending. Ensuring that media is bought effectively and not directed toward the “wrong people” has always been a challenge for marketers. Traditionally, the goal in media planning was to minimize wasted advertising, which was achieved by reducing the quantity of advertising sent to consumers who are unlikely to purchase or have an interest in their product and who are not active in the category. This is the reason target advertising came to be.

Most targeted new media advertising currently uses second-order proxies for targeting, such as tracking online or mobile web activities of consumers, associating historical webpage consumer demographics with new consumer web page access, using a search word as the basis for implied interest, or contextual advertising.

Addressable advertising systems serve ads directly based on demographic, psychographic, or behavioral attributes associated with the consumer(s) exposed to the ad. These systems are always digital and must be in that the end point which serves the ad (set-top box, website, or digital sign) must be capable of rendering an ad independently of any other end points based on consumer attributes specific to that end point at the time the ad is served. Addressable advertising systems therefore must use consumer traits associated with the end points as the basis for selecting and serving ads.

Targeted advertising is ubiquitous. Through the emergence of new online channels, advertisers have new ways to struggle with identifying consumers and tracking behaviour. They want to guarantee that the advert can influence or touch the best consumer for their company’s product. This has resulted in the increasing need for targeted advertising.

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Wikipedia