Analysis of the Impact of Targeted Advertising Methods on Consumer Buying Behavior in the B2C Segment

Niklas Jakob

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Bachelor Thesis from the year 2023 in the subject Communications - Public Relations, Advertising, Marketing, Social Media, grade:...

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Bachelor Thesis from the year 2023 in the subject Communications - Public Relations, Advertising, Marketing, Social Media, grade: 1,0, University of Applied Sciences Hof (Business Department), course: International Management, language: English, abstract: Targeted advertising methods are essential tools for marketers who aim to tailor their marketing communication to specific target groups. The impact of such targeting methods on consumer buying behavior, however, is contentious, as data privacy concerns on behalf of the consumers threaten to impair the effectiveness of targeted advertisements. Against this background, this thesis investigates how targeted advertising methods affect online buying behavior in the B2C segment. In this context, the thesis particularly examines technical targeting methods, as the comprehensive review of literature and prior research revealed a research gap in this field. To answer the research question and test the associated hypotheses, the thesis resorted to an online survey, encompassing two questionnaires distributed to German- and English-speaking sample groups. The quantitative data obtained through this online survey was subsequently analyzed using statistical methods such as descriptive statistics, group statistics, correlations, and T-Tests. Eventually, the findings gained from this procedure enabled the derivation of theoretical contributions to the field of strategic marketing and practical recommendations for B2C companies. Targeted advertising has evolved into a significant part of the global advertising ecosystem, making it feasible to target consumers based on an analysis of data gathered online. The appeal of targeted advertising is anchored in the ability to provide consumers with a tailor-made advertising experience. According to German economist Bernd W. Wirtz, targeted advertising methods are essential elements in the targeting process, as these methods enhance the effectiveness and efficiency by which target consumers can be addressed. Consequently, Wirtz identifies the selection of appropriate targeting methods to be critical to the communication success of companies. A study conducted by IHS Markit validates the claim of Wirtz that targeted advertising methods have a positive impact on advertising effectiveness, indicating that specific targeting methods achieve click-through rates [CTR] that are up to 5.3 times higher than the CTR of non-targeted advertising formats. In light of the elevated propensity of consumers to click on a targeted advertisement, Michael Bailey and Ayman Farahat argue that targeting reduces the cost-per-click [CPC] of an advertising campaign.