The other day I watched my first episode of Mad Men. I'm a little late to the game, I know, but that's what having Netflix, Hulu Plus, and Comcast on Demand are for.
The irony of using anytime, commercial-free media to watch advertisers work in a world with only three television channels got me thinking about the social implications of advertising in that old world and our new one. Back in the 1960s, it was a good bet that your neighbor watched the same episode of Bonanza you did last night, with the same advertisements for Coca-Cola and Goodyear. Neighbors, colleagues, and communities shared in the media experience together to a much greater degree than we do today.
But so what? The benefits of increasingly targeting advertising are easy for both advertisers and customers to see. Who wouldn't want to stop wasting money advertising to people you don't want to sell to? And who wants to waste time seeing ads for things you don't want to buy? (Certainly not me, as I watched Mad Men commercial free.) As advertisers and their agencies continue to experiment with the technological possibilities, it's not hard to imagine reaching the ultimate end, depicted in the 2002 Tom Cruise film Minority Report. If you haven't seen it, check out the Gap store scene here on YouTube. In this future world, billboards and retail signs can recognize you and call out to you by name, asking how you liked your latest purchase. In the real world, companies like NEC are already creating systems that recognize and respond to age and gender of passers-by.
Still, the unbridled search for the ultimate in personalization has a downside. As media — and the advertising seen on it — become more focused on smaller groups of individuals, we see less of the same advertising content as other people do. And that's a potential blow to advertisers for several important reasons:
- Shared experience shapes our perception of products. Our opinions of a product, and the pleasure and value we get out of it, don't just come from our own personal contact with it. We perceive a soft drink or a beer, for example, differently when we know its brand and how others feel about it. If other people have a quite different (or no) understanding of what it means to use an Apple product or drive a Mercedes, that will sensibly decrease our joy in owning them.
- Sharing an experience helps encode new memories. Sharing an experience in general makes it more likely that you'll remember it, research shows. And in the context of advertising, this means discussing an ad with another person makes it more likely you'll remember the product when you have the opportunity to buy it. This is a challenge given the amount of advertising that people now view alone.
- Group affiliations are important components of brand loyalty. What could be more natural, when advertising to different groups than to wish to adjust the message so that it resonates best with each group. But trying to be very different things to all people can backfire and alienate a core segment of consumers. This is most obvious in the case of luxury brands, which can dilute their brand equity when reaching below the premium segment. But even everyday brands connect with people's sense of identity and can engender in-group/out-group thinking. Pepsi found this out the hard way when many people it was hoping to reach decidedly did not seem themselves as part of its "New Generation."
I'm not suggesting we abandon targeted ads and use all the money to spring for Superbowl or Academy Award spots. Targeted advertising offers incredible promise. But as we forge ahead improving the technology that lets us do it well, we should also consider how to do it, keeping in mind the importance of shared media experiences.
In this regard, Google offers an intriguing example for creating a targeted and shared experience at the same time. Its campaign of sentimental ads that tell various life stories through someone's searches — in one case adopting a stray dog, another finding love in Paris, another watching a child grow up — can easily be targeted to animal lovers, students, and parents. But through the consistency of their emotional appeal and their message they connect all those groups to the Google brand in the same way.
Examples of campaigns like this that achieve what I call "shared personalization" are relatively rare. But technology (in combination with the same old-fashioned creativity that Don Draper would bring to the table) will make them easier and easier — and probably also more and more critical.
Advertising today is surely not one-way monologue between a company and customer but a way of starting a conversation between people. Combining the best of targeted advertising with shared media experiences will be a powerful, and meaningful, recipe for success.
An HBR Insight Center