Splintering of the Consumer Market

Before the 2010 Super Bowl, what was the most watched television show? Surprisingly, it was the final episode of "M-A-S-H." The record stood for over 25 years, even with a growing population. In 1983 there were essentially three networks, so the television audience didn’t have many choices. This was a marketer’s dream. Not only could you reach a massive audience, but you could count on these significant shared experiences as common points of reference.

Marketers face a very different environment today with the proliferation of media channels, the internet, user-generated content and so on. The mass entertainment media market has been continually segmented into finer interest, demographic and lifestyle groups. This segmentation creates new opportunities in target marketing, but it also creates many challenges.

The most obvious opportunity is to be able to target products and marketing messaging to very refined segments. Whether it’s automobiles, music, apparel or consumer electronics, there are products that fit every lifestyle and interest segment. Marketers can dramatically improve conversion rates and advertising effectiveness by targeting their products through these splintered consumer markets.

On the other hand, the challenge is fewer shared experiences. Individuals are ordering custom content and experiences that appeal to their unique tastes. In most households, mom, dad, sister and brother are all attentive to their own smartphones, tablets, televisions and MP3 players. In this splintered environment, marketers have a harder time appealing to shared experiences and frames of reference understood by the mass audience.

Reaching the Splintered Consumer
The new environment favors a direct marketing approach to online advertising rather than a more traditional branding and awareness approach. Sophisticated marketers are using several different strategies to not only maintain advertising effectiveness, but to actually improve it.

The most fundamental direct marketing principle at play here is to go where your customers are. In a splintered media world, that means contextual targeting, behavioral targeting, social media targeting and mobile marketing.

Contextual targeting has been around for a while. Google and other networks enable advertisers to target advertising based on keywords throughout the web. Advertisers can reach important segments of the splintered market based on the content of an article, blog or other web page. Contextual advertising has become more sophisticated over time as marketers move beyond text ads to include imaging, rich media and other types of targeting techniques (e.g., local targeting).

Behavioral targeting is based on profiles of consumers that are created through visits to websites. These websites include contents sites, retail sites, blogs and social networking sites. For example, sports enthusiasts can be identifed by visits to ESPN.com or Yahoo Sports. Marketers can use this information to target millions of sports enthusiasts. Serving ads specifically to consumers who have visited a brand’s site, known as retargeting, is also a popular and effective strategy for reaching the right segment of the splintered market.

Mobile and social marketing are also important emerging channels to reach the splintered market. Through device, operating system and browser detection, websites and marketers can identify mobile users and specifically target messaging to this growing segment.

Specific offers and messaging that appeals to this user segment can improve overall advertising effectiveness. Likewise with social networks, marketers can advertise on social networks to broadcast or narrowcast their messaging. The viral nature of social networks only enhances the message effectiveness through reposts, retweets and other linking techniques.

The splintered consumer and media markets present great opportunities for sophisticated marketers. As with any direct marketing program, measuring and optimizing the results is critical to obtaining the best possible performance. Though it takes a little more skill to reach the total target audience, the results can be much more gratifying.

Jim Wehmann is senior vice president of global marketing for Digital River, a provider of global e-commerce solutions. Jim can be reached at jwehmann@digitalriver.com.