We've reached a time in online advertising where it's good to pause and reflect. Consider that today the majority of the US has become digitally social, smartphones are now used by 40% of us and the last several years of sizable tech adoption, brand trial & error and numerous research studies have all enabled an opportunity to see what's working.
It's also nice to observe that what was once overwhelmingness has now faded to normalcy...
If you work in marketing you've probably seen this logo collection several hundred times in presentations talking about what to do online:
When we first saw this we all panicked because there was so much to learn and we all felt so behind. But today we know that such an exercise was kind of like putting up a logo sheet of all the restaurants in your city. Yes, there's a lot of places you could eat but you'll get along just fine not spending time at all of them.
We seem to be settling in; not becoming complacent but, rather, comfortable about what each of us like online and what we don't. What's right for our brand, and what isn't.
So taking all of this in, when it comes to online advertising planning and spending in 2012, what are some good insights to consider?
Online Display Advertising
Here's a good question: If you primarily sell things offline what's the value these days of buying display ads online?
A recent study by comScore and dunnhumbyUSA revealed that display ads may be working harder than previously thought. When offline buying habits of households were compared between two different groups--those exposed to online ads and those who weren't--offline sales increased 21% among those who were exposed to the online ads.
What's even more telling is that when predictive targeting was applied to online ads the study showed an in-store sales lift of 42%. So even though nearly three quarters of us say that we're opposed to such behavioral targeting tactics being applied to our web habits, when it comes to our actual actions, we don't seem to mind after all. (Wonder what we'll think about this?)
What's interesting to note here is the value beyond click-thru. Browsing the web is like strolling through town... as we stroll we see billboards. But the narrowest those can get in a city is simply close to the retailer sponsoring the board. They don't get to our unique lifestyle because they're designed for mass awareness. On the web, billboards can get amazingly close to our lifestyle. And it's confirmed that the closer they get the more we click...
Long-tail sites, as they've been called, are the millions of smaller websites for niche audiences. Advertisers too often avoid buying these because they don't have as many eyeballs as short-tail sites and the pages aren't as polished. But click-thru rates of long-tail sites outperform short-tail sites by a healthy 24%.
Click-thru rates have also been measured in relation to their location on the web page; ads that appear above-the-fold are seven times more effective at getting click-thrus than those below-the-fold.
Online Video Advertising (Not the viral stuff... That's a different post.)
Russell Davies once wrote:
Something That's Growing Is Not The Same As Something That's Big.
Something That's Declining Is Not The Same As Something That's Small.
He probably didn't intend for it to be used this way but this is helpful to keep in mind when thinking about entertainment online. What was forecast by some to be the end of TV hasn't proven to be the case as it's the second fastest growing medium today behind the web. And what's interesting is that web video providers have found that the best online video advertising format is... what's done on TV.
Studies show that when users view full episodic 22 minute dramas online 94% of them will watch a standard ad break. For short videos and clips 59% of us will watch an ad.
And while we watch how do we click?
In general terms, it turns out there's little variance between who clicks and why. However, according to eMarketer/TidalTV, the best performing day of the week is Wednesday for whatever reason.
That's not very helpful.
But this is: While the creative may be similar to standard TV the magic comes in the ad buying. The rise of behavior targeting models have created demand side platforms (DSPs), such as MediaMath, that can serve ads to specific inventory slots based on relevancy to individual consumers and are priced based on the demand for that target audience.
At Ignited, an agency that oversees digital media buying for many Hollywood studios, they look at it like this:
We need the reach and efficiency that you can only get from DSPs. They help us achieve scale and better returns on our ad spend... We measure cost per video completion as our primary success metric. Unique reach and frequency are what really matter to us.
Search
When asked which marketing channel small business marketers couldn't do without, word of mouth was highest at 50% and search marketing was last at a mere 3%.
But paid search is growing at 15% annually and accounts for half of all online media spending. Some forecasts are expecting this to lessen as more is spent on banners, video and email.
Search will be most interesting to watch on mobile. Mobile search is growing 6% month-over-month and search companies are predicting that mobile will become the dominant search form in five years.
Five years.
Consider how important being top ranked will be in 2016 when most search is done on a mobile device...
Let's look at a current search.
Searching for "mens shoes" on a desktop returns this:
That same search on the phone returns this:
Note Zappos.com. On the desktop they're one of four on the top along with many down the side. On the phone they have the only top sponsored site on this search, flanked with the SEO in the third position.
Building search strategies, best practices and budget allocations now is of the highest importance as future search on the phone will be more visually pleasant for the users and more difficult for the advertiser to be a top selection.
Social & Email
In the US total social media use is up 25% over last year. Additionally, Internet Retailer says that Facebook accounts for about one third of all online display ads. However, their click through rates are small at less than 1%. Facebook's Sponsored Stories will help as studies have shown them to boost those click through rates by about 46%.
But even Sponsored Stories don't get Facebook close to the effectiveness of email. While Sponsored Stories might get a 1.5% click through, email marketing can average an 11% click-through rate. Apples and oranges? Maybe, but it correlates. Fan/Like growth is sexy because it's public and there's tertiary benefits of known popularity and an owned channel of what can be a staggering number of fans. But classic, well-scrubbed database building remains golden.
For Facebook, here's what their Sales Director said earlier this summer:
I see Facebook as a complement to other forms of media. What sticks out is that Facebook is a much more social and personalized experience. In the age where people are getting hit with hundreds of marketing messages a day -- depending on what study you use, it can be as high as 700 messages a day -- how do you stand out from that? I think a recommendation from a friend is extremely powerful.
Which gets us to that 'fingernails-on-a-chalkboard' expression of 'joining the conversation.' (They're each seven syllables.) Facebook has always been the place to connect. Honda does a terrific job of this. Their page is based around the common bond of owning a Honda, not just the Honda company. And it starts with their Facebook page logo--all about connecting:
But we don't all connect physically. Sometimes it's just connecting through observation. And observation is hard to track as engagement. Half of us are introverts which means that comments, likes and shares largely done by the extroverts are telling what could only be half the story. In addition, a recent study reported that 77% of consumers interact with brands on Facebook primarily through reading posts and updates.
For organizations connecting with people on social networks is becoming more challenging as engagement on brand Facebook walls is down 22%.
Perhaps the reason is because brands can do a better job posting content that rides the edge of pop culture. People want to talk about pop culture, especially in the US. Take this year's Royal Wedding, for instance, where 65% of social media chatter came from America.
When something positively big happens in culture we should try to roll with it when it makes sense. And having a relevant twist for your own audience is what's important. Tim at Snarkmarket phrased this well recently when analyzing his most popular Tweets:
People love pop culture references... What people really seem to love are oblique, unexpected pop culture references that hit a particular niche. They’re tweets that say: “this message was only for you; now share it with everyone you know."
This is something we talk about a lot at the agency.
And it's good to see we're not alone. Tim Leake likens much of the successful marketing today as that of an Improve Group. And one of the core principles of an Improve Group is that of "Yes, And..." Or, in other words, taking what's happening on stage and riffing on it versus talking about something entirely different and selfish.
"Yes, And..."
So, in the end, we all should look to do something like Anthony's Pizza did when Dominos spent tens of millions talking to us about their new recipe:
Sources: Please see links next to stats throughout post.