IAB UK Real Living 2021: Consumers want nuanced online ad targeting

People’s understanding of how digital advertising works has deepened and advertisers need to reassess how they are targeting people online as a result, according to the IAB UK’s Real Living 2021 study.

The report shows that people’s use of digital media has surged since 2015, providing advertisers with an 18-hour window to engage with online audiences every day. While an average of five digital devices are used per day, the smartphone is the most popular by far with 80% using it daily and 41% saying that it has changed the way they consume entertainment at home.

However, as digital habits have become more ingrained, people’s understanding of how online advertising works has also become more comprehensive. The study shows that while 61% understand and accept the role that advertising plays in funding online content, they increasingly want control over the ads that they see.

People place most value in relevant digital advertising – ads that are based on what they have been looking at online or that successfully predict what they need in that moment – as well as ads that enhance the online experience, such as in-game rewards or influencers’ shopping advice.

Yet there is a fine line between relevant creative and over-personalisation – 47% of regular CTV watchers find it ‘unnerving’ when ads on streaming services are too tailored to them, while digital ads that are felt to be out of people’s control (e.g. not skippable or an intrusive format) create a bad impression.

The study shows that successful targeting relies on advertisers taking a more nuanced approach to digital media in all its forms. By understanding where consumers’ digital habits peak and trough throughout the day, as well as people’s mood-states when engaging with different digital media, ads can achieve relevance and resonate with increasingly astute audiences.

For example, advertising in immersive environments such as podcasts, in-game or online retail should be highly contextual, frequency capped and maximise engagement with a strong narrative. Meanwhile, ads in discovery environments such as online news, search or grocery sites should aim to aid the user journey with helpful advice or offers, while not overstepping the mark or distracting from the task at hand.

For advertisers, this study should underline the importance of taking a nuanced, refined and contextual-led approach to digital targeting – taking into account all of the ways that people are engaging with different devices throughout the day – rather than employing a blanket strategy across channels or falling into the trap of over-targeting.

Jon Mew, CEO, IAB UK