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Death by Over-segmentation

audience targetingtargeting

Advertising agencies LOVE building audiences. We love doing it here at Arm Candy too, as it lets us media folks flex our creative muscles. Oftentimes, there is nothing more impressive than being able to tell clients who their consumer is, down to what gym they are most likely to frequent, where they go grocery shopping, and what brand of ice cream they often buy.  All of the above makes for a lovely couple of slides in a deck—which can be beneficial. 

Unfortunately, it’s a pretty terrible way to plan media. And it will become even less useful when cookies go away. 

Economies of Scale

Just because you can target 38 to 42-year-old moms who go grocery shopping on Tuesday and drive a Lexus RX doesn’t necessarily mean you should. Besides, that data is likely probabilistic, so it’s almost certainly not 100% accurate. (And did you even ask when that data was last refreshed? Probably not.) For most consumer-facing brands, layering on a slew of impressive targeting segments will dramatically increase your CPMs, as third-party data segments can range from $0.50 to $2.50 per segment. 

There are a finite number of impressions targeting the above-listed Mom profile, so you will need to likely bid more on those available impressions to reach your audience a number of times to push them to purchase. Instead of spending $9 targeting the Mom with all of the data segments layered on—you can expand your reach and prospecting bucket by spending only $3 targeting a more general Mom and get yourself more bites at the apple.  

Correlation Isn’t Causation  

Take the above example again with the 42-year-old mother with kids. It’s easy enough to drop a pixel on a conversion event and see what third-party segments have the highest audience overlap. 

Most media buyers tend to fall apart at the next step—applying irrelevant segments and confusing an over-indexing segment as a mandatory target. If you are advertising diapers to this mother, why does it matter to you that she uses her MasterCard to heavily purchase Blue Bell Ice Cream? Why not just make look-alike models based on the first-party CRM data, which takes into account thousands of data signals, not just five or six that were hand-picked.  

Buy the Objective, not the Audience

Buying the outcome, not the audience, has been a core focus of Arm Candy since our inception. This is the crux of our proprietary data warehouse and planning tool, which focuses on reaching business objectives, not audiences based on cookie data.

In general, the AI of most buying platforms is good enough to use a general audience as a baseline, allowing for trust within the algorithm to find the right consumer.  Add that powerful off-the-shelf technology to Arm Candy’s proprietary tech and human intuition—which will create a media plan built on satisfying business objectives—and you will get better results than slicing and dicing your audience pool into so many segments.  

Want to see a media plan that isn’t based on an audience profile, but rather our proprietary data tool?  Shoot us a note. We are happy to help!  

Written by David Mahaffey

David is the resident operations nerd here at Arm Candy. As as naturally competitive person, getting in platforms and seeing how we can beat ourselves keeps him loving the job. Outside of campaign performance, you can usually find him sipping an adult beverage in the pool or reading a thrilling historical biography.

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