DRAFTED/REVISED MIDTERM LITERATURE REVIEW
In an attempt to build an individual’s web identity and to predict their next consumer move, marketers and advertisers tactically map a consumer’s identity through the obscure third-party tracking of digital behavior and activity by following a trail of, if you will, ‘cookie’ crumbs, to collect various data points that web users leave behind. Targeted marketing has “arguably been the driving force behind the success of many well-known brands (e.g., Pepsi, Mercedes-Benz, Miller Lite) and provides the basis of a predominant branding strategy, the user positioning approach, in which the brand is closely associated with a particular user or customer (e.g., Maybelline and the girl next door)”(Aaker, Brumbaugh,Grier 128). Because the touch points between organizations and consumers effectively define the revenue of those organizations, media companies, marketers and advertising agencies are shaping their strategy around consumer behavior by tracking their web activity (Vollmer 3).According to Christopher Vollmer, it took 127 years to reach an advertising revenue of $20 billion in newspapers, 25 years to reach this revenue for cable television, and a mere 13 years for digital media to reach $20 billion in advertising revenues . As such, Vollmer reports that 88% of marketers to spend more on digital ads, while 82% believe that consumer insights gained from targeted-relating tools will become increasingly invaluable (4) . Advertising has become less of a call for attention, and more of a strategically aimed service based on consumer demand and data points. Those companies that can effectively adapt to the new platform of marketing interactivity; i.e. those who are able to provide the what the consumers want, when they want it, will be the organizations that survive in the age of “Digital Darwinism.”
The integration of engaged and relevance based advertising is creating a blurring of the lines between organization responsibility, in that many marketers are adopting “new models of interaction with agencies and media partners.” Similarly, up to forty-two percent of marketers have incorporated the use of in-house advertising agencies, according to a recent ANA survey (Vollmer 11). Due to the influx of these “full-service” organizations, smaller agencies are struggling to keep up with the massive shift from the traditional business model to the modern, consumer-driven and comprehensive capacities of the full-service agencies, and two-thirds of these smaller agencies are taking costly measures to completely restructure their businesses and restructuring their technology foundations. The closeness to the consumer that is achieved through multi-channel user engagement in the full-agency model is evidently and conspicuously generating more collaborative consumer relationships than the smaller agencies have the capacity to do (Vollmer 6). However, the all-inclusive model that many media organizations are adopting lack “reliable and standard metrics” across their multi-platform systems. The partnerships between “digital agencies, traditional media agencies, and media companies to track ad placement, versioning, and effectiveness [with]... savvy mathematicians, engineers, and computer scientists” is inhibited by a the absence of “collaboration and a recognized set of metrics,” as Vollmer writes, “It’s one thing to collect digital information; it’s quite another to draw intelligence from it” (11).
“Carolyn Everson, chief operating officer for ad sales at MTV Networks, notes, ‘New digital platforms generate a ton of data, but we haven’t yet cracked the code in developing universal measures of success across both traditional and new media. For marketers to plan, measure, and optimize audiences, metrics require standardization. For example: How will we track audiences across multiple platforms? What is the value of cross-platform reach and engagement? We are constantly working with clients to address these questions’” (qtd. in Vollmer 11)
Successful marketing is ensured with the implementation of “STP strategy—that is, segmentation, targeting, and positioning.” Segmentation, is the process of ‘segmenting’ various target consumer profiles, under the assumption that there is a degree of homogeneity in the needs, desires or characteristics in these individualized sectors of the targeted-market (Lynn). Segmentation works by delivering advertisements to consumers that will theoretically identify with the content of the media, and therefore identify with the product (Aaker, Brumbaugh,Grier 129). However, in digital advertising, the identity of the consumer is generated based on an often unsystematic or unrepresentative set of data points. The segmentation of the digital target-market is more inaccurate as the barriers to using the internet are low and available to most consumers. Therefore, target-marketing to the digitally segmented consumers can lead to the negative effects of unintentional viewership by the “non-target market,” or those individuals who feel incongruencies with the delivered marketing materials. These “non-target” receivers develop a “decreased preference for an advertisement” in believing that they are not the target of the advertisement (Aaker, Brumbaugh,Grier 130).
Anecdotal evidence suggests that individuals viewing an advertisement that has not been designed to appeal to their market segment are likely to view the advertisement as distracting or irritating (Star, 1989), may feel ignored or neglected (Greco, 1989), or even become alienated or offended (Lipman, 1991) (Aaker, Brumbaugh,Grier 129).
Consumers will seek congruence in the visual representation of a products usage and the anticipated resulting outcome of consumption….[and] if the product is not in-line with the cultural needs of the consumer, then attitude towards the product and resulting purchase intent will be adversely affected by the marketing efforts”(Meyers 7). Often, is the failure to accurately define the dimensions of digital target-markets that are segmented based on randomized data points, that leads to the market-failure of a given product (Rittenburg and Parthasarathy 51). While consumers are consistently willing to trade their data and privacy in return for recommendations, services, and customization tools, often companies use this “captured information” to force onto the consumer intrusive messaging (Dahlström and Edelman). Because, “American families, on average, repeatedly buy the same 150 items, which constitute as much as 85% of their household needs,” (Schneider and Hall), rather than digitally force unwanted viewership and interaction onto internet users based on disjointed data points, companies must begin to use a more cross-function system of target-marketing that can successfully define and address customer interactions through a comprehensive view of the entire story and identity of the consumer. The product must fit the lifestyle, and the lifestyle is based on a comprehensive analysis of consumer identity--not solely a compilation of scattered data points. As such, they must understand the ways in which the “ individual encountered a brand and the steps they take to evaluate, purchase, and relate to it across the decision journey” (Dahlström and Edelman).
In order to actually benefit the consumer, an organization must know the consumer and the target market to which they belong. Full-agencies must not only generate a clear path of an individual’s digital consumer behavior in order to customize an experience, but they must also understand the trends and behaviors of the market to which they belong, allocate sufficient amounts time to developing a team for CRM-or Customer Related Management-to socially engage with and sample from their target-consumers, as well as to integrate effective tools that can rapidly assess spending trends and touch-interaction and contact as they relate to consumer decision journeys (Dahlström and Edelman).
- Aaker, Jennifer L., Anne M. Brumbaugh, and Sonya A. Grier. "Nontarget Markets and Viewer Distinctiveness: The Impact of Target Marketing on Advertising Attitudes." JOURNAL OF CONSUMER PSYCHOLOGY 9.3 (n.d.): 127-40. Web.
- Dahlström, Peter, and David Edelman. "The Coming Era of ‘on-demand’ Marketing." McKinsey Quarterly (2013): n. pag. Web.
- Lynn, Michael. "Segmenting and Targeting Your Market: Strategies and Limitations." School of Administration Marketing Collection(2011): n. pag.Cornell University; The Scholarly Commons. Web.
- Meyers, Yuvay Jeanine. "Target Marketing and the Product: Categorizing Products to Understand the Resulting Marketing Communication Outcome Measures." Journal of Management and Marketing Research (n.d.): 1-8. Print.
- Rittenburg, Terri L., and Madhavan Parthasarathy. "Ethical Implications of Target Market Selection." Journal of Macromarketing 7.2 (n.d.): 49-64. Web.
- Schneider, Joan, and Julie Hall. "Why Most Product Launches Fail." Harvard Business Review (2011): n. pag. Hbr.org. Web.
- Vollmer, Christopher. "Digital Darwinism." Comp. Booz&Co. Marketing and Media Ecosystem (2010): n. pag. American Association of Advertising Agencies. Web.