Is Hyper-Targeted Marketing Worth the Risks?

fermanis_UnderstandRisksBenefitsBeforeEmployingHyperTargetedDigitalMarketing April 4, 2022 By: Alexis Fermanis

Hyper-targeted marketing can work well for organizations, but it may also feel invasive to some users. Associations should understand the risks and benefits before they engage in such strategies.

We’ve all experienced hyper-targeted marketing, even if we aren’t always aware that it was happening. For example, maybe it was the sneaker ad you were served on Twitter the day after you were sneaker shopping online, or the emailed coupon for a nearby pizza joint when you are traveling, or that email promoting where to find the best babysitters that showed up in your inbox after your first ultrasound. In short, hyper-targeting identifies desired audiences and delivers relevant messages where they are likely to see them. Creepy at times? Yes. But often extremely relatable and, well, right on target.

We know it exists, but can associations use it to their benefit? And are there any risks in deploying hyper-targeted campaigns for your own association?

Yes and yes.

The Benefits

Through hyper-targeting, you can clearly identify and target your audience to better provide relevant information more likely to deliver positive responses. You can also better ensure your messages will be seen and resonate with the viewer. While no two people are the same, many people have similar attributes, habits, and interests. History has shown that homophily, or the tendency for individuals to pursue people with similar interests or behaviors to themselves, results in similarly minded relationships. This makes behavioral targeting and “lookalike” campaigns predictable and easy to target. Once we identify desired demographics, psychographics, and behaviors, we can develop profiles that allow accurate segmentation and messaging, which in turn, often drives stronger acquisitions.

Some of the key benefits of hyper-targeted marketing include the ability to:

  • Deliver personalized messages relevant to your audiences and deliver information they need and care about. You can know not only know if your member is a music lover, but if he or she prefers country or pop music.
  • Establish deeper relationships and build trust with your audiences.
  • Get better, more qualified leads.
  • Experience better ROI on your advertising spend by ensuring you reach the right audiences and deliver the correct messages to generate more acquisitions.

The Risks

Although predictive modeling can help determine what like-minded audiences might also enjoy, what happens when our predictions are inaccurate? What happens when we put someone inside a presumptive behavioral “box” and miss the mark? And how do we get them out of the box when they don’t even know they are in it?

Some of the risks of hyper-targeting include:

  • Inaccurate segmentation
  • Broadening knowledge gaps between siloed groups
  • Appearing culturally insensitive as a brand
  • Excluding audiences from knowledge they might otherwise care about
  • Increased costs and draining company resources

When we segment, we run the risk of building bias into our presumptive behavioral marketing models and assuming we know the needs of each targeted group, or grouping individuals based on bias. This can lead to inaccurate targeting, which can tarnish your brand’s reputation and sour your audiences. Ensuring your predictive modeling is accurate and not wrongly presumptive is key. After all, bad data leads to bad business.

Due to specialized niche targeting, often using artificial intelligence, we are often grouping audiences into small, homophilic groups, which could be otherwise known as algorithmic tribalization. Continuing to feed like-minded groups the same information they already agree on and care about doesn’t widen their knowledge of your organization and all that it has to offer. Sometimes segmenting can cause them to miss out. They don’t know what they don’t know, and you are only escalating that and causing groups to become further siloed. Diversity of thought becomes obsolete, people are left out of conversations, and—perhaps—left behind altogether. You also run the risk of your brand becoming culturally insensitive or invisible by only targeting one group with one type of content.

In addition, there are the added costs and resources to create multiple messages and separate contact lists to target multiple audiences. You need to ensure you have the capacity to correctly handle segmentation or the above risks can become a reality quite quickly.

Finalizing Choices

When choosing whether you want to use hyper-targeting, prioritize what matters most for your goals and brand and identify what resources are available to accomplish these marketing efforts. Through segmentation of demographics, psychographics, and behaviors, you can be more effective, if done correctly.

Alexis Fermanis

Alexis Fermanis is the senior director of marketing and communications at the Society of Industrial and Office Realtors in Washington, DC.