Targeting existing brand buyers can boost return on advertising spend, new research finds

Despite the advances in digital and mobile marketing, many consumer-packaged-goods (CPG) marketers are still not aware of what makes up the best audience. Together with Nielsen Catalina Solutions (NCS) and Viant, Joel Rubinson at Rubinson Partners aimed to offer further insight into this issue by testing consumer responses to three advertising campaigns.

Applying the Principle of Recency theory, which suggests that adverts are most effective when delivered just ahead of a purchase, advertisers could benefit from accurately timing their ads to reach consumers.

In addition, the study also hypothesised that buyers of a certain brand, but not those loyal to a brand, would make for a better target for an ad campaign. As such, it was proposed that ROAS would be highest among heavy shoppers ready to make a purchase – referred to as “The Persuadables”.

As it turns out, Persuadables really are persuadable, increasing return on ad spend by 16x. This group of shoppers exhibited 10x better performance than the overall average ROAS across all three campaigns.

The other two groups which performed well on ROAS were heavy spending buyers targeted early during the purchase cycle, as well as medium spenders reached later in the process.

However, non-brand buyers that are being targeted late or early both resulted in the lowest ROAS.

Jon Schulz, CMO at Viant, explains:

“Brand marketers have access to large amounts of customer data, but they still have challenges connecting the dots to understand the customer journey, from knowing not just who to target, but when to target them. For the first time, this research utilizes CPG shopper data to construct and test a new segmentation framework, designed to help marketers better understand their key audiences. NCS’ consumer purchase data, combined with Viant’s first-party data, advertising reach, and targeting capabilities, delivered extremely promising results.”

These findings demonstrate that advertisers can boost their ad return rates by simply targeting existing brand buyers instead of trying to reach new, non-brand shoppers. By tapping into first-party data insights, marketers can now clearly define their individual audiences and engage them using relevant ads.

Joel Rubinson adds:

“The findings from the report enable marketers to precisely identify the audience segment that will yield the greatest return for their spend. By incorporating the persistency of a people-based approach into digital advertising campaigns, marketers can identify their most valuable consumers and accurately predict when they are most likely to purchase a product, essentially defining the Persuadables segment.”