Advertising just got micro-personal – why we don't care

August 28, 2018, University of South Australia
Credit: CC0 Public Domain

With all the buzz and hysteria about how consumers are being cunningly "micro-targeted" in a bid for mind control, not only by advertisers of products but also by political parties, researchers at UniSA's Ehrenberg-Bass Institute for Marketing Science have discovered there is probably no reason to panic.

Personalised advertising may be one thing but getting people to respond to even micro-targeted ads is a whole other ball game.

Looking at work published in the academic literature that inspired Cambridge Analytica's now infamous use of Facebook data, they've found not only fairly low click through rates (CTR) for personalised Facebook ads, but some of the results were even counterintuitive – with a higher CTR coming from ads mismatched to personalities.

Analysing research from Michael Kosinski and David Stillwell's (with colleagues) main experiment to test the responding click through rates of people targeted with ads suited to their psychological profile (introvert or extrovert), they found that across all 3.1 million exposures, CTRs were a bit lower overall than the industry average for Facebook ads.

Professor of Marketing Science, Byron Sharp says how the research could be interpreted as proof of the value of psychologically tailored advertising, is a bit of a mystery.

"There were some differences in the CRTs in the different creative ad executions, but overall the rates were low and rather inconveniently, the ad with the highest responses or CTR was an ad designed for extraverts but opened by more introverts," Prof Sharp says.

"We need to remember that while the capacity of new technologies to deliver ever-refined targeted marketing is available, there is very little research available that says this works.

"The assumption that mass customisation is more effective than mass appeal is purely speculation and to date the evidence is not supportive.

"Today, most media offer the chance to target audiences geographically and for many businesses that is all they need.

"They also offer the ability to target by time, gender, age and interests such as food or sports but for many brands the incremental gains that might come from any other tailoring would be very small indeed.

"Facebook is vast and is of great value to advertisers, but there is no real proof that psychographic targeting offers anything extra."

Prof Sharp says the results of psychological targeting on behaviour beyond just getting a click through are ill defined.

What we do know from broader social research, including a recent metanalysis of 299 studies over 20 years involving almost 90,000 participants, is that there is little evidence that changes in implicit bias have any relationship to changes in a person's behaviour.

"Even those of us who are more aware of the stereotypes and biases that affect our decisions, have the ability to avoid acting on them," Prof Sharp says.

"For businesses, the take-out message is to be wary when it is proposed that a large amount of company money should be spent on systems to design micro-segments and deliver mass customised advertising.

"We have got a lot to learn in this space.

"Businesses need to know under which conditions this kind of intensive customisation actually delivers a greater overall response that exceeds the costs involved in setting up a customised system.

"Right now, there just isn't the researched evidence to support big claims about micro-personal influencing purchasing or other choices."

Explore further: Is it time to regulate targeted ads and the web giants that profit from them?

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