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It's 2007 Planning Time

  |  October 24, 2006   |  Comments

Five important areas to consider as you plan your 2007 media budget.

It's that time of the year again. Time to look at your marketing budget and make important decisions about digital marketing allocations. In case you haven't heard the news, there's plenty of money flowing into the online space. EMarketer predicts online advertising alone is growing at 30 percent a year and will swell from $16 billion this year to over $25 billion by 2010. That's serious money.

As more money flows into the digital space, important questions arise about online's role in the marketing mix. These are great questions, albeit more complex than they were in the past. I find this gratifying because the questions are more holistic and strategic.

A couple years ago, we were asked to put together recommendations about budget allocations within the channel (i.e., search, online advertising, site design, e-mail, etc.), based on specific initiatives or campaigns. But few marketers were looking at all the digital touch points that make up the experience they deliver to customers before they determined strategies and budgets. As a result, we worked doubly hard to ensure digital initiatives tied back to real and strategic business objectives.

Now, as bigger budgets move into digital and the Internet moves back into the C suite, the questions assume a more informed, strategic tone. Here are the 10 themes I hear most frequently as we plan for 2007:

  • Is the way consumers use digital media to make purchase decisions for our product changing?

  • Is our company using digital media to its fullest potential? How do our customers view our Web presence?

  • Should our digital initiatives be more tightly integrated with our offline initiatives? Are there benefits to that?

  • We're seeing a lot more engagement with our brand online. Is it leading to more sales?

  • Our natural search results are improving so we have more unpaid traffic. Does this mean we can reduce spending on paid search?

  • As traffic increases, the conversion rate drops but overall sales increase. How should I feel about that?

  • Should I focus on site enhancements or redirect my online ad spend?

  • Rich media seems to be working better, but it costs more. Is it worth it?

  • The digital world is changing quickly. We've experimented with podcasts, social media campaigns, online gaming, outdoor digital, and more. Which has been the most effective, and why?

  • Where should we place our bets in 2007?

All are great topics for discussion. For clients for whom we're the lead digital agency responsible for online advertising and site work, we compile thoughtful answers because we have a total channel perspective. For those clients that parcel out their digital work, we're reliant on them to formulate a total channel perspective, so those conversations are more challenging.

As you go into 2007 planning, whether you're an agency planning with your clients or a marketer, think about five important areas:

  • Begin with a clean sheet of paper. Are you relying on things you've done in the past to shape decisions for 2007? Don't limit yourself to what was. Think broadly about your goals and how you can achieve them.

  • Let consumer insights lead the way. Are you investing in gathering customer insights to inform decisions? Do you have a full understanding of how consumers use the digital medium to make purchase decisions and act on them? Do you have metrics in place to measure progress along the way? Creating clear personas to represent target customers is a wonderful way to ensure your strategy is truly user-centric.

  • Think holistically. Are you thinking about the digital channel broadly, that is, for all aspects of the consideration cycle, from awareness to loyalty? Thoughtfully consider how you can deploy your budget at the key leverage points across the digital spectrum.

  • Anticipate competitive threats. Have you checked to see how your digital initiatives measure up against the competition and how those might shape customer expectations? If you're a step behind, consider a leap-frog approach to put your competition on notice in the online arena.

  • Allocate for innovation. Are you allocating part of your budget for marketing R&D in new media and platforms so you keep your approach fresh and relevant? Think about it. A year ago almost no one had heard of YouTube; SecondLife was on the margins. Consider setting aside some money to abreast of Web 2.0.

It's time to ask yourself and your agencies the hard questions. Don't stop until you get meaningful answers.

Nominate your favorite product or campaign for the 2006 ClickZ Marketing Excellence Awards, October 16 through close of business (EST) on October 24. Final voting begins on October 30.


Mark Kingdon Mark Kingdon joined Organic as CEO in 2001 and has led the company to its current position as a leading digital marketing agency. Prior to Organic, Mark worked for Idealab and provided strategic guidance to emerging companies. Earlier, he was a partner at PricewaterhouseCoopers, where he led the America's retail and distribution industry practice and managed the PWC and Lybrand merger and was a leader in the e-business practice globally. Mark is a member of the International Academy of Digital Arts and Sciences and serves as a Webby judge. He's also a regular contributor to Three Minds, Organic's blog. Mark received his MBA from the Wharton School of Business and a BA in Economics from UCLA.

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