When TV Advertisers Reach for Sales, Relevant Audiences Deliver

New analysis illustrates effectiveness of purchase-based targeting for driving reach and incremental sales at scale

By Peter Topol, VP, Advanced TV Partnerships

Concentrated orange juice. Watercolor paint. Bleach. Some things are designed from the start to be watered down. But – like iced coffee – audience segments are not one of them.

The goal of advertising audience segmentation has always been the same: deliver more tailored and targeted content to the right consumers to sell more products. Diluting observed audience behavior by adding demographics and psychographics of the target audience results in reaching households that are unlikely to purchase the product. 

Since audience-based TV advertising first became possible, advertisers have operated in the tension between personalization and reach. Purchase-based targeting, in particular, is still seen as being narrow, despite clear success for many brands. Rather than dive all in, marketers will test the waters of purchase-based targeting for TV while also continuing with their aspirational targeting strategies or creating a new target audience from a blend of traditional and intended buyers.

In the case of adding demo-based targeting to purchase-based campaigns, the combination of the two is not greater than (or even equal to) one on its own. Rather than complementing each other, combining the two targeting strategies reduces the potential for success. Success defined as: incremental sales and relevant reach.

Previous Category Buyers Contribute Big Time to Incremental Sales

In this streaming TV example from a leading pain relief brand, advertising to a purchase-based audience resulted in more exposed households than the demographic target. But the really interesting piece is not the scale of the two audiences, it’s how they responded: 

• Previous Brand Buyers contributed 73% more incremental sales to the total sales than the demo target.

• Expanding the audience targeting definition to Previous Category Buyers, households in this segment contributed 92% of all incremental sales driven by the campaign.

Put simply, most of the incremental sales driven by this campaign came from households in the Category Buyers audience segment. Advertising to households outside of this group would have been like trying to sell beef to a vegetarian. Clearly, adding reach by “complementing” a purchase-based target with a demo target did not add results. 

Use Past Purchase Behavior to Reach Even Better Buyers

For brands that want to maximize their budgets and still need to meet reach goals, there are ways to use purchase-based targeting to get in front of a larger audience that’s still more likely to make a purchase. In the case of one paper towel brand, they knew the value of purchase-based targeting but also wanted to find an effective way to reach a larger audience. They turned to NCS to understand what products consumers tend to buy together. This analysis helps brands know what shoppers are most likely to purchase alongside their brand during the same trip. This allowed them to double the reach of their purchase-based target by using a custom audience target that included buyers of leading toilet paper, laundry detergent and facial tissue brands.

Once again, reach is only the beginning of the story. The goal of this campaign was to grow brand share and conquest buyers from the competition. The demo target only drove 6% of incremental sales from people who hadn’t bought their brand in the past – not furthering what the brand set out to do. The purchase-based target resulted in 36% incremental sales from new customers and was able to grow share by driving sales among prior brand buyers. Wins all around. 

Purchase-based targeted advertising drives more sales by reaching a more relevant audience, helping advertisers improve outcomes and achieve their goals. If you’re a TV advertiser who wants to maximize sales lift for your next campaign, download our e-book Streaming Our Heads Off.