Targeting Tactics used to raise ROI.

Making sure even small marketing budgets are not wasted.

Niche marketers may have a harder time targeting their audiences, but at least it doesn’t cost as much as mass campaigns.

That is one of the main findings of MarketingSherpa’s “Online Advertising 2008: What Works, What Doesn’t and Why” report.

The research company surveyed marketers in the US in February 2008 and found that nearly one-third of those targeting niche consumer audiences spent under $9,000 during the month. None of the marketers targeting mass consumer audiences spent as little, and over one-third spent $1 million or more during the month.

“The more people you are advertising to, the more you are going to wind up spending,” said Tim McAtee, senior analyst at MarketingSherpa, in a statement. On the other hand, he noted, “If you’re selling nuclear reactors or something, like GE, you can have a huge cost per ad—a huge cost per sale, and have that still make sense.”

Mr. McAtee added that eliminating wasted impressions and making a good impression with great advertising was the best way for advertisers to improve ad spending ROI.

The specific targeting strategies agencies and advertisers in the US use to minimize wasted ad impressions vary, but the vast majority use some kind of targeting, according to Collective Media’s “Ad Network Study 2008.”

Nearly eight out of 10 respondents said that they planned to use demographic targeting in 2008, almost exactly as many as did so in 2007. Contextual, geographic and re-targeting were all set for slightly lower use this year, while nearly three-quarters of respondents planned to use behavioral targeting this year, up from the roughly 64% who did so in 2007.

“When putting together the online portion of a campaign, the question should not be whether or not to target ads,” said David Hallerman, senior analyst at eMarketer. “Instead, advertisers and agencies must examine the best actions to track, what metrics will gauge a campaign’s effectiveness and what goals underlie the marketing.”

Courtesy of http://www.emarketer.com