It’s time wastage got a bit of strategic attention
An obsessive focus on targeting is holding advertisers back and damaging brands.
There’s a chance you've never given wastage much thought. Such is the focus on driving efficiency through the use of data in media to be ever more precise in our targeting, there’s the possibility you’ve never even heard of wastage.
I offer the following definition: wastage is the budget spent on delivering advertising impacts that have reached someone who has no interest in, and who is therefore not going to buy, the product or service being advertised.
It sounds like a no-brainer to eliminate wastage where possible, and that’s been the promise of data-led targeting.
Using data, we can deliver more relevant advertising and reach only those in-market or near enough to being in-market to be tipped into a purchase. Every dollar spent has a fighting chance of resulting in a sale.
It’s a promise that beguiles advertisers increasingly under pressure to make budgets work as hard as possible.
But in concentrating all our strategic efforts on thinking how to maximise the benefits of targeting we forget to optimise wastage. And it’s holding advertisers back and whittling away the foundations of long-term brand growth.
Optimising wastage may sound like a fool’s errand, but if we flip the strategic lens from targeting to wastage, it becomes immediately apparent that my definition of wastage is sorely lacking a timeframe.
A focus on precision targeting leads inevitably to a focus on short-term results by demanding immediate and on-tap proof of the efficacy of the targeting strategy.
We know that not all advertising has an immediate impact and that there are people who are not in-market today who nevertheless will be in-market one day and that our ads might have a longer term effect on their purchase decisions.
Yet we don’t tend to think about optimising to reach those people. Pampers target pre-family adults as well as young families, and that strategy of optimised wastage pays off when very many first time parents making their first nappies purchase instinctively turn to Pampers.
After those initial purchases many parents start exploring ‘own brand’, but many others stay with Pampers, having been won over long before they were even in-market.
In an interview for Mediatel News last month, Bob Hoffman, ‘The Ad Contrarian’, said that advertising lacks an arrow of progress. We don’t learn from our mistakes to make advertising better and more effective.
I think this is because short term gains are so seductive.
Tighten up targeting and ROI just gets better and better. But many times now I have seen brands practically optimise themselves out of business.
There’s a balance to be struck between efficiently converting sales today and topping up the funnel for tomorrow.
We know this. And if we ignore it, brands shrink and eventually disappear.
Embracing and optimising wastage is the key, but how do we do that?
We start by redefining our approach to defining target audiences to strategically, deliberately, include wastage. Not just the in-market nows, but the in-market eventuallys.
Not just the buyer but those around the buyer who influence or legitimise the purchase. We must think about how we reach those people and how we measure the effectiveness impact of reaching them.
This means augmenting short-term performance metrics with softer, longer term, brand metrics to give us a wider understanding of what’s going on. Candidate metrics include NPS, purchase intent, brand affinity and gross brand awareness.
Flipping the strategic lens this way, and not just thinking about targeting but actively developing strategies for wastage, is the key to long term brand growth and is perhaps what’s needed to give advertising the arrow of progress it needs.
Steve Taylor is joint chief strategy officer at VCCP Media