Pros and Cons of Behavioral Targeting in Advertising

Are you considering doing behavioral targeting in advertising but you don’t know what to expect? If YES, here are pros and cons to take note of. 

For many companies, traditional advertising may seem like an arbitrary, hit-or-miss operation. Carefully crafted messages sometimes fall short without an apparent reason. Potential customers usually fail to connect with the product in a way that encourages them to engage and purchase.

Note that these less desirable results often stem from marketers creating ads that fail to address the viewer’s particular interests and desires. They can also result from reaching the wrong audiences altogether.

However, in this age of data and advanced tracking technologies, random marketing should be the way of the past — especially on the web. Aside the fact that prior methods lacked effectiveness, they have led to the unquantifiable waste of valuable resources over the years.

If you are an advertiser, you can use the innovations of data management and proper targeting to seek audiences that offer higher conversion rates.

Behavioural targeting is more or less a marketing method that leverages web user information to strengthen advertising campaigns. The technique includes gathering data from a variety of sources about the potential customer’s online browsing and shopping behaviours.

Note that this information helps create ads that are relevant to that specific user’s habits and interests, which the publisher can then display in that visitor’s web browser.

Have it in mind that one of the primary purposes of this technique is to deliver advertising messages to the behavioural target markets that have shown the most interest in them.

The process involves compiling web searches, purchase histories, frequently visited websites and other information to establish a full user profile, indicating what your audience wants, avoids and purchases.

Note that by using these data points, companies can formulate ads that align with the individual consumer’s trackable preferences and needs, without conveying messages the viewer would find unappealing or irrelevant. Without doubts, there are many advantages of targeting in marketing, such as improved advertising performance across the user acquisition cycle.

While targeting is seen as a way of increasing interaction rates with advertisements, it should also improve other metrics further down the funnel, like retention and monetization.

It also increases the likelihood that the right types of users for a particular product or service will want it, and that they will perform in a way that you want them to. It also makes it more likely that other benefits of a positive user experience (such as word-of-mouth recommendations) occur.

Even though targeting might principally take place when an advertiser sets up a campaign, the true benefit of taking targeting seriously should be felt across the whole of the business.

Pros and Cons of Behavioural Targeting in Advertising

Aside being a good marketing technique, the advantages of using behavioural targeting are much more tangible than abstract number systems. Below mentioned are some advantages of behavioural advertising:

1. Increase in User Engagement

Behavioural tracking gives publishers access to consumers who display habits of engaging with specific marketing material. Note that with just one-click ads, consumers can be redirected to online storefronts and gain Intel on the company in a matter of seconds.

However, without advertisements that establish a sense of interest and trust, viewers are less willing to engage initially. Once the user accesses the company’s website, the brand can offer content from other areas of the site, increasing clicks and activity for targeted ads down the line.

2. Higher Number of Ad Click-Through

Also note that a well personalized ad that captures the viewer’s likes and needs is a much more useful tool in helping consumers move down the purchasing pipeline than a generic banner ad without any concise appeal.

Upon initial exposure to a highly-desired product, an interested viewer is much more likely to seek more information than they are with brands that fail to align with their previous browsing and purchasing behaviours.

3. Improved Conversion Rates

Ideally, advertisements that reach a behavioural target market have higher appeal to those who view them, growing the chances that users will proceed to request more information or complete a purchase.

With the techniques of behavioural targeting, companies can witness an increase in sales and repeat customers, enjoying higher profits overall.

4. More Exciting Ad Experience

Have it in mind that online users don’t always enjoy the idea of giving up personal information to advertisers. However, they tend to find it more frustrating when the ads they encounter are irrelevant and un-engaging.

That’s why reports have it that 71 percent of consumers prefer more personalized website ads, even if they need to expose their click and purchase habits in exchange. When the ads are more personalized, viewers find their browsing experience more enjoyable overall, leading to higher user satisfaction.

5. Higher Efficiency in the Online Shopping Process

Note that once ads for products that interest consumers are prominent in their web browser, consumers can click through to access online storefronts quickly, often being automatically redirected to the particular product highlighted in the ad.

From there, adding the item to their shopping cart and proceeding to checkout only involves a few easy steps, which online shoppers often appreciate.

6. Reminders and Alerts for New Products

By steadily seeing ads for products they find attractive, viewers can keep up with new releases and stay informed about brands they enjoy.

Also, if a user was distracted from completing an online purchase, a personalized ad about the company may remind and motivate them to go back and finalize the transaction.

Disadvantages of Behavioural Targeting in Advertising 

1. Behavioural Targeting Can Get Costly

Running pay-per-click ads may not be the most budget-friendly solution. Behavioural targeting falls under that umbrella, and it can get costly. However, it is imperative to ensure to check your advertising budget — and set budget caps — to make sure you have the financial bandwidth to produce ads for the entire campaign.

2. Ads Can Fail Without Proper Audience Knowledge

Note that if you don’t know your audience, it is more or less likely that behavioural targeting won’t give you positive results. Notably, the ads are shown based on audience segments you select.

But, without proper knowledge of what customers respond to, there’s room for lack of resonance from your target market. If ads messaging fails to capture the interest of the majority of your target audience, it won’t be very effective.

Behavioural targeting finds the right customers, but it is up to your ad to seal the deal. You have to make sure you’re up-to-date with how your target market responds to ads to improve performance.

3. Behavioural Targeting Can Lead to an Advertising Overload

Have it in mind that producing too many ads can lead to an oversaturation of content and ultimately deter customers from wanting to engage with your ads. As a consumer, if you are presented with numerous targeted ads from the same companies, you will have to mentally block out any advertising messages from that business.

However, you can use behavioural targeting sparingly and also save money while also catching customers at the right time.

You should also make sure to modify your ad settings so you’re not showing users targeted ads every five minutes. Behavioural targeting is just one of the many advertising optimization strategies that are great for generating leads.

If you’re finding that your current ad strategies aren’t producing the ROI you’re looking for anymore, this tactic could be your answer.

4. Is All of the Collected Data Ethical?

One of the biggest issues with behavioural marketing is the question of privacy and ethics. Many people are uncomfortable with the ways companies collect and use consumer data, and for good reason.

Indeed, behavioural marketing can make our lives better, but it has the potential to be used to track or influence people.

Location and browsing data, time of day, purchase history, and other types of data are all used in behavioural marketing. While consumers have some control over what kinds of data can be collected, there are lots of ethical gray areas involved.

How Behavioural Targeting Advertising Works

Behavioural targeting is all about tracking user behaviours online and collecting pieces of data from these behaviours called “cookies.” The process often involves four steps.

1. Collect Cookies

Note that when users visit new websites or create an account, for instance, a cookie is placed on their computer, stored either temporarily on a local memory drive from which it is deleted after the browser is closed or more permanently on the device’s hard drive.

2. Create a User Profile

Once the cookies are collected and stored over time through new page visits, ad clicks, time spent on particular content and other data, behavioural patterns can form related to shopping and search habits.

3. Designate Consumer Groups

By leveraging the patterns and profiles created, companies can separate users into different target market groups. Once these distinctions are made, websites that focus on behavioural targeting will be aware of the purchasing trends, interests, likes and dislikes of the members of these individual audience segments.

4. Share Relevant Information With Viewers

At this point, instead of getting random ads, consumers will view custom content and personalized ad material that draws from past behaviours when they reconnect to the network or website.

However, for this process to be successful, it requires a powerful data gathering tool and a successful means of implementing it.

Conclusion

Behavioural targeting is a powerful tool that creates an opportunity for businesses to understand better and meet the needs of their target audience while achieving their business goals and increasing ROI.

In the end, companies need to weigh the pros and cons of using behavioural marketing before using it in their marketing strategies. In today’s market, many companies are finding that this kind of personalization is necessary to stay competitive and serve their customers’ needs.