CLINT BALLARD WROTE:
>While I agree that the results will vary widely based on the
>specifics (see my previous post), saying that "No definitive
>statement can be made" is too pessimistic. For instance,
>the following would be the starting point: "If the target
>audience comprises 1/N of the untargeted audience, then the
>value of the targeted advertising is N times the
>untargeted." [Linear Valuation of Targeted Pricing: TP(1/N)
>= N] The rationale of this theory is that it will cost the
>same amount of money to reach the same amount of targeted
>people, eg. if the target audience comprises 20% (1/5th) of
>untargeted, then it is worth 5 times the premium.
>
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Interesting analysis, but the premise is very limited in
scope. It assumes a situation in which the targeting is
within the *exact* same universe as an untargeted ad. That
can be true in some cases, but it is of limited
applicability. "Targeted" and "untargeted" are vague terms.
Perhaps you were assuming in your post that you were talking
about targeting within the exact same universe. I didn't
make the same assumption.
Moreover, the analysis assumes that all potential buyers are
within the targeted universe. I don't think that's likely
to be true. If it is not true, then you cannot say that
then the value of the targeted advertising is N times the
untargeted. You must subtract from N the potential buyers
you've excluded by your targeting.
Doug Bates
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Received on Thu Feb 04 1999 - 10:53:19 CST
