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Stop Doing Digital Advertising

  |  September 8, 2013   |  Comments   |  

Consider these three rules for marketing in a digital world.

Of late, there's been a lot of speculation about the future of online advertising, especially with a recent report on the rise of ad-blocking. The report found that web publishers tend to underestimate the effect of ad-blocking in their business and found that as many as 22.7 percent of people who visited 220 websites in the research were using ad-blocking software. It also found that ad-blocking is set to grow by 43 percent yearly. This spells bad news for both publishers as well as brands that have shifted media budgets online for increased reach, better accountability, and higher return of investment in media investments.

The digital media industry has evolved tremendously over the past couple of years, driving better user targeting and media efficiencies with the rise of demand-side platforms that support real-time bidding, retargeting platforms, and even stuff like Facebook Custom Audience, which allows you to target existing customers on Facebook even though they haven't liked your brand simply by matching email addresses and mobile numbers in your existing customer database against those used on Facebook. In fact, retargeting efforts by brands have been ramped up of late as I found myself being followed repeatedly by a Zalora product ad that was served using Triggit Facebook Retargeting after having browsed that product briefly on the Zalora website.

However, as publishers and platforms like Facebook and Google come up with more innovative ways to collect data and target users, consumers are fighting back in their own ways. One recent example is this project by a Singaporean student in New York who created a browser extension that confuses ad targeting with cookie misinformation, thus helping you mask your identity across the web.

At the same time, as Facebook reports that it made around US$11 per user in ad revenue in 2012, a thought provoking question was asked to users if they would be willing instead to pay Facebook US$11 per year not to have any advertising shown to them; which is the same model that Spotify has with its premium subscription.

Mind you, I'm not predicting doomsday for the online ad industry. I'm merely trying to point out a weakness in online ads alone to drive marketing.

In my experience, many people unwittingly or perhaps intentionally confuse digital marketing as just online advertising.

Just to be clear, online ads are a huge part of the digital marketing mix. They provide the conduit in which brands reach prospects and customers in online spaces where people are increasingly spending most if not all of their time. However, without the fuel of a great idea and clear message, digital ads (and this includes brands that simply stick their 15-second TV copy onto YouTube as a pre-roll) simply don't cut through enough to get noticed or worse still, get blocked by users who are sick of irrelevant and interruptive ads.

Furthermore, even if users notice your ads, the click-through rates these days are so dismal that you're 31 times more likely to win the lottery than to click on a web banner.

Start Marketing in a Digital World

In my view, there should no longer be a distinction between digital marketing and marketing anymore. The world we live in has become digital and henceforth, all marketing needs to be done in context of a digital world.

Three rules for marketing in a digital world:

1. Value exchange over interruption. As consumers wrestle back control of their attention from marketers, brands need to ensure that there's a value exchange for their attention and engagement.

That value comes in the form of something useful - content that's informative or entertaining (Red Bull is perhaps one of the best brands in doing this) or a utility/digital service that helps make their lives better, either by solving a problem or by elevating their quality of life (a great example is Windows Chip In, an initiative by Microsoft to help students crowd-fund their next Windows PC.

The brand personality and advertising message is embedded into the content or service and delivered to consumers through a medium in which they are willing to engage with.

Moving from an interruptive, message-led model to one that provides a value exchange with consumers will help brands cut through the advertising clutter and reach the audience that they truly want to engage with and drive consideration for their products and services.

2. Always-on brand platforms over tactical campaigns. I believe there's a bigger role for digital beyond a communications channel for campaigns and there's a need for digital activities to be always-on, so consumers are always engaged and this helps build value for the brand across campaigns over time.

Most brands launch largely tactical campaigns that operate in silos in terms of generating audience engagement and participation. Think of it this way: during campaigns, brands invest in media and thereby get a lot of engagement with their target audience in the digital space. However, after each campaign trails down and ends, the audience loses interest and leaves. When the next campaign starts, the brand will again have to invest in media to bring the same audience back.

To better maximize campaigns and drive business efficiencies, there's a need to shift toward a platform model, which allows all digital activities to be connected over time. A platform helps anchor campaigns together, allowing brands to constantly engage their audience during and in-between campaigns and provides a launchpad from one campaign to the next.

By leveraging on an engaged audience, the brand's cost of investment to acquire each customer goes down with each campaign and the value of each customer goes up because they can sell them more stuff. And because they are always engaged in a relevant way, brands also generate increased earned reach from these consumers through them sharing and socializing the brand.

From a communications point of view, a brand platform also helps bring together multiple brand initiatives into one unified "big idea" that helps drive the overall brand equity.

Platforms can exist in different forms - as a website such as P&G's EverydayMe or a digital application and community like Nike+.

3. Connected ecosystems over digital islands. A unified brand platform will allow brands to move away from digital islands that are created from multiple campaigns and digital assets into one connected digital ecosystem that brands can use to collectively showcase their presence in the digital space. The big opportunity is for brands to be able to organize and deploy digital assets in a way that the result is far greater than the sum of the individual parts.

To make this happen, there's a very big role for data that will allow brands to profile and deliver relevant content and experiences to customers. By recognizing individual customer relationships, brands can then create a relevant dialogue that will keep them coming back all the time.

Image on home page via Shutterstock.

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ABOUT THE AUTHOR

Vincent Teo

Vincent is the co-founder and partner at C//IQUE, a product development studio and incubator that focuses on developing digital products and services that disrupt traditional business models and empower consumers. He has over a decade of experience both on the client and agency side, most recently as a digital planning director at BBDO/Proximity and lead digital strategist at Publicis. Prior to that, he started-up and managed the Hong Kong office of Splash Interactive Group and built the online business at Citibank and HSBC. Connect with him on Twitter @intersphere.

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