Rules that exist for search advertising don't necessarily apply to other media. Here's why.
The purpose of advertising is to create demand for a product or service. Advertisers want get people to give them money. And they want to forge a lasting relationship with those people, so they can continue to get paid. Every dollar spent by an advertiser is an investment in the creation or maintenance of a financial relationship with a person.
If advertisers could know that every dollar spent would come back to them as a revenue-positive event, they would spend an almost infinite amount of money. That obviously isn't the case, as some types of advertising are more effective than others. And generally those effective forms of advertising are a scarce commodity. Generally there isn't enough ad inventory available in these high-demand media to cover any one advertiser's entire marketing need. Said another way: even if an advertiser bought all the inventory that made sense for his needs, it wouldn't drive enough sales to meet the goals. So advertisers must spend in multiple media.
Over the history of advertising, a general consensus has been achieved on what types of media work well for specific goals. The process a person goes through as she makes her way from unknown to paying customer has been carefully studied and codified as the purchase funnel:
In general, the more effective a media vehicle is, the closer the person is to purchasing a product, the more desirable that media is. The confounding issue is scale. If the media vehicle doesn't reach a large enough audience, it doesn't have as much value to the advertiser:
The media with the greatest audience reach and highest impression volumes -- TV, radio, newspapers, billboards, and magazines -- are considered very effective media for driving consumers down the purchase funnel. But They aren't as good at driving a purchase, retaining customers, or creating customer advocacy. But the media that are great at driving purchases have much less inventory.
Search advertising is an example of a very effective media type that simply doesn't have enough inventory to effectively drive enough sales for any one advertiser to replace the rest of the media spend. Direct mail is the only other media type as effective as search advertising at driving purchases, and only the most targeted of mailing lists fall into that full-circle category.
So while search is a very important media type, it's important mostly for the search engine provider with the largest audience and not nearly as important to any one advertiser or any one other search engine provider. There are, of course, a few exceptions to this rule. A few major advertisers, like eBay and Amazon, have such a broad number of products that they can cast a much broader net than most companies. And the automated marketing management systems and advertising platforms they've built internally enable them to take the best practices in their approach to the medium.
To advertisers, scale matters. Advertisers need to be able to create demand for their products or services with minimal effort and maximum return on investment. And search simply doesn't have enough inventory to matter, compared to other media. If one were to ask the largest advertisers in the world to shift $1 billion of their budget into search, they simply couldn't. There isn't enough inventory to buy.
For most advertisers, the media that reach the largest appropriate audience and drive potential customers down the sales funnel become the important ones. And it's incredibly important to understand that search advertising rules don't necessarily apply to other media. This is mainly because the majority of people who are exposed during other stages of the sales funnel are much less likely to become purchasers quickly, if ever. So while there's more waste in other media, they still have their place and still meet advertiser goals.
Join the Industry's Leading eCommerce & Direct Marketing Experts in Chicago
ClickZ Live Chicago (Nov 3-6) will deliver over 50 sessions across 4 days and 10 individual tracks, including Data-Driven Marketing, Social, Mobile, Display, Search and Email. Check out the full agenda and register by Friday, Oct 3 to take advantage of Early Bird Rates!
IBM Social Analytics: The Science Behind Social Media Marketing
80% of internet users say they prefer to connect with brands via Facebook. 65% of social media users say they use it to learn more about brands, products and services. Learn about how to find more about customers' attitudes, preferences and buying habits from what they say on social media channels.
An Introduction to Marketing Attribution: Selecting the Right Model for Search, Display & Social Advertising
If you're considering implementing a marketing attribution model to measure and optimize your programs, this paper is a great introduction. It also includes real-life tips from marketers who have successfully implemented attribution in their organizations.
September 23, 2014
September 30, 2014
1:00pm ET/10:00am PT
October 23, 2014
1:00pm ET/10:00am PT