Yahoo!'s CPG category development officer shares research showing behavioral targeting's effectiveness in reaching the right consumers.

As Americans, we believe all people are created equal. This is great for democracy, but let's be honest, when it comes to running a business, every marketer knows that some customers are simply more valuable than others. These are the people who drive a majority of your revenue and, at the end of the day, will make or break your campaigns.

For a small business, it's very easy to know who these customers are. But as a marketers' customer base expands, and scale becomes a critical issue, advertisers have historically looked for more efficient ways to connect with this group of customers. For many businesses, this has resulted in marketing and product development strategies that targeted the broad middle. Mass media and big bucket, demographic targeting seemed the most efficient means to reach them. And while this approach isn't wrong, perhaps we should go back to basics, and literally focus on the right consumers.

Great, I knew that. How do I reach them?
Traditional media have had a tough time bringing this principle to life. Before the internet, direct marketing and customer relationship management had the competitive advantages of consumer segmentation and targeting quality. But in recent years, the online space has emerged as an intriguing model, and one that offers added value for businesses. Not only can it provide quality consumer segmentation and targeting based on behavior, but the internet also offers a relevant and compelling media platform. As consumer roles and behaviors change, so too can online's ability to adroitly target, reaching the right person with the right message at the right place and at the right time.

Behavioral targeting works
Consumer segmentation and subsequent behavioral targeting will become more prevalent because they have proved to be both effective and efficient. Yahoo! and AC/Nielsen have partnered to offer a product called Consumer Direct, which enables advertisers to see how online advertising affects offline sales. This product merges the Nielsen Homescan Panel with opt-in registered Yahoo users to create an online behavioral model of a brand's "Most Valuable Consumer" that can be projected and targeted across the Yahoo network. 

The results, measuring over 150 consumer packaged goods and pharmaceutical advertising campaigns, have consistently shown an ROI of between two and three dollars of retail sales for every dollar of media spend. The average sales lift of those exposed to certain online ads versus unexposed is 26 percent.

Going forward, there will be more emphasis on data to ensure that the targeting and receptivity of programs are measured and improved upon. This is the tip of the proverbial iceberg. For example, marketers currently can purchase display ads on mobile phones. These mobile platforms will have the ability to leverage user data and real-time browser habits to serve behaviorally targeted advertising. Customer receptivity to messaging on personal devices remains to be seen, but as more opportunities are created through wired and wireless technology, behavioral targeting will certainly lead the way. 

Marketers who understand this, and who believe that not all consumer behavior is created equal, will leverage behavioral targeting more strategically, and in doing so, will gain a true competitive advantage.

Brian Zeug is CPG category development officer, Yahoo! Read full bio.