Over the past two years, the 10 largest digital-originated brands advertising on TV and radio have increased their spend on these platforms by an average of 318%. These brands range from established ecommerce giants to mobile gaming upstarts that have seen meteoric growth. But regardless of sector, they have all invested in reach as a way to reach consumers and increase brand awareness.
Acknowledging Value Beyond On-Target
Ratings for digital audiences have allowed the industry to engage in a healthy discussion about on-target rates and whether buyers should pay for inventory delivered outside of a target age and gender. Some have even questioned whether Gross Rating Points (GRPs) should still apply in a world where you “actually know” who people are.
But at its core, the GRP is remains the measure that tells advertisers what they want to know most: how many people see the ad and how often. In other words, reach and frequency.
For years, the ROI from GRPs on television used to be highly predictable. Today, there are many more questions around ROI. TV remains relatively straightforward, because of its limited ad formats - all video and typically 15- and 30-second spots. The digital world, on the other hand, is much more complex and offers dizzying variations of tactics. For example, a full screen video may have more impact than a banner ad and a precisely segmented impression may have better immediate outcome than an unsegmented one.
Still, even as capabilities to define who sees a message and where it finds them have become more advanced, we’ve seen an enduring truth: There is often value in advertising to people who fall outside of a target. Let’s not forget - they buy stuff and influence others. So, even if those segments are less effective recipients of a campaign than the primary target, they still yield important value.
Redirecting the Conversation
The prospect of widespread dynamic advertising is incredibly exciting for the industry, especially when evaluated across the widening array of potential ways to connect with consumers. But regardless of the tactic every advertisement has a potential audience, an actual audience, an effectiveness and a cost.
The right combination of the broad reach at the top of the funnel and sales amplifiers that effectively targeting the lower funnel will vary for brands depending on their objectives and sectors. But there’s no question that balancing this mix will be one of the most important challenges for all advertisers going forward.
While there has long been a perception in digital that advertisers need to react to a million individual desires, brands are built by creating a million similar desires. There is still a need for common cultural narratives and a long view that drives sales today in addition to building customer loyalty for the future.
Whether you are looking to build or maintain a brand, reach is essential.
It’s time for us to redirect the conversation, moving away from considering on-target as a key performance indicator and instead gain a clearer understanding of how reach and frequency of campaigns impact the effectiveness of ads presented to a broader audience.