The ongoing proliferation of media channels that businesses can advertise through has given marketers more choice than ever in how they promote their products and services. This has compelled them to think more strategically - scientifically, even - about the specific media channels they choose to employ.
In lockstep with the evolving advertising needs of businesses, media vendors are increasingly obliged to offer the specific range of options their customers desire and be ready to tailor packages to their particular needs. If you can’t give customers what they want, they will look elsewhere, so it is important to understand what they want, and why they want it.
The 60/40 Rule
A common error in marketing is thinking too short term. Christmas on the horizon? Launch a Christmas campaign. Anticipating a summer rush of business? Tap into the demand with seasonal advertising.
While this kind of event-based marketing can give a business a satisfying spike in sales, brand building is possibly even more impactful… in fact, it has been proven to be more impactful.
British marketing researchers Les Binet and Peter Field have spent years researching the impact of short-term versus long-term marketing strategies, and found that the optimal strategy is to adopt a 60/40 balance in marketing spend: 60% on brand building, and 40% on sales activation.
Savvy businesses today will plan their marketing strategy to strike a balance like this, and will seek vendors that can best enable them to do so.
The Multiplier Effect
The Multiplier Effect can be summed up in the phrase “the whole is greater than the sum of its parts”. It refers to how using various marketing channels results in greater positive impact than the individual channels would produce on their own. Depending on the medium, the effect can be as much as a 100% increase in ROI. So it is no wonder that marketers take it seriously.
The effect is partly related to the age-old notion of the “Marketing Rule of 7” which states that the average customer has 7 interactions with a brand before they take action. The number 7 itself is not set in stone, but illustrates that multiple touch points are required to move customers through the marketing funnel, from awareness, to consideration to action.
Marketers explicitly think in these terms when formulating their marketing strategy, and expect to be able to purchase complex packages from media sales vendors that stimulate the Multiplier Effect and achieve the rule of 7.
The New Normal, and the end of third-party cookies
While “the new normal” is certainly an overused term, the impact of coronavirus on the media landscape has indeed been profound, bringing with it a marked increase in the “halo effect” of news brands (84% of news consumers report feeling that advertising in news brands increases or maintains Brand Trust), and an unexpected 12.2% YoY growth in digital advertising spend in 2020.
With digital revenues growing, and a positive reputation among advertisers to tap in to, media owners need to be prepared to cater to more sophisticated marketing demands. Recent research by Boston Consulting Group and Google has revealed that the troubled past 18 months has accelerated digital adoption, with “digitally mature” companies twice as likely to grow their market share in the next 12 months.
Not only that, by 2022 Google is aiming to remove third-party cookies from their Chrome browser, with Mozilla Firefox and Apple’s Safari eying a similar goal. For a long time, third-party cookies have been a key enabler of targeted advertising and campaign optimization, but as concerns over digital privacy have increased, so too has opposition to invasive tracking.
While this may seem to be a setback for both buyers and vendors, digitally mature marketers will view this as an opportunity to optimize their use of things like first-party data and contextual targeting to drive revenue.
Media sales vendors are going to find themselves doing business with a new generation of digitally-savvy marketers, whose requirements extend far beyond mere impression counts. To cater to their needs, and avoid customer churn, you will need to be able to learn, act and launch a wider range of ad products fast and efficiently.