Making the very best targeting decisions can have a compounding effect on return on ad spend (ROAS), in accordance with latest data released this week by TransUnion.
According to the TransUnion evaluation, the upside in ROAS from higher targeting could possibly be as high as 9x.
TransUnion used real-world campaigns from 25 of its measurement clients across five verticals and located a widening performance gap as audiences became more targeted. An audience built with two optimal consumer traits had a 3.6-times ROAS upside, while an audience with three optimal traits had a 7.2x upside.
Conversely, the evaluation also demonstrated the danger of making suboptimal targeting decisions. The more campaigns targeted the flawed audience segments, the more severe their performance was. At the far end of that spectrum, mis-targeted campaigns saw a 90% drop in ROAS.
“In a world with 1000’s of targeting selections, the challenge is choosing essentially the most effective option from many who appear similar,” Matt Spiegel, executive vp of TruAudience Growth Strategy at TransUnion, said in an announcement. “Our data proves that even inside common attributes like income or age, the performance difference could be massive.”
Positive and negative impact of targeting sophistication on ROAS
| Single characteristic audience | Two characteristics combined | Three characteristics combined | Four characteristics combined | Six characteristics combined | |
| Correct decisions | 97% | 3.6x | 7.2x | 8.3x | 9x |
| Wrong decisions | -49% | -78% | -88% | -89% | -90% |
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TransUnion’s evaluation evaluated 26 targeting attributes across six distinct categories—akin to age, income, presence of children and neighborhood type—and located that even subtle variations in targeting led to significant swings in ROAS.
The evaluation highlights a chance for marketers. Rather than defaulting to broad assumptions—e.g., “go after high income” or “goal by age group” — they’ll uncover more precise combos, often where they least expect them.
The TransUnion study is predicated on Q4 2024 campaign data from 25 brands across five industries, with no less than two brands per industry. Quarterly spend ranged from $5 million to over $100 million per brand. In total, the study analyzed $1.5 billion in campaign spending and greater than $18.4 billion in events across a broad set of addressable paid-media channels, including audio, connected TV, display, search, social, and video.
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