Audience data is as good as gold when it comes to the returns that you can earn from it. You are likely familiar with Return on Ad Spend (ROAS), which is a key performance metric in advertising. But what about Return on Audience Data (ROAD)?
ROAS and ROAD are related, but we’ll first start by clarifying the relationship between Ad Spend and Audience Data.
What is Return on Ad Spend?
In the simplest of terms, Return on Ad Spend can be explained by Revenue divided by Ad Spend. While there are many variations to calculating ROAS, this is the example that we’ll stick with. When it comes to Ad Spend, you may think the only component is the Cost of Media. The real cost for Ad Spend however is the Cost of Media plus the cost of Audience Data.
Second and third-party audience data is often more expensive than the cost of media for digital display advertising, making your Ad Spend costs go way up. First party audience data, however, is data that you already own. While it wasn’t necessarily free for you to acquire it, you own it and it can be used to your advantage. Your audience data includes visitors to your website that is tracked via cookies, emails lists and CRM data, app users, and more,
When your own audience data is used for digital display advertising, we call it Retargeting or Remarketing. With Retargeting, you eliminate a major expense in your advertising expenses, data costs, and you can amplify your revenue. Retargeting is one example of how we build Return on Audience Data (ROAD).
Interested in learning more?
Our company, ReTargeter, has a great article that reviews measuring ROAD and ROAD, Audience Targeting, Retargeting, and a review of a case study on building a Return on Audience Data.