India’s 150 million Internet population is rapidly growing and so is the number of advertisers. These advertisers can be classified as brand advertisers – those doing sporadic online marketing activities to either complement their offline marketing tactics or just getting aligned with changing consumer habits. The other set of advertisers are the hardcore players also known as performance players. They’re in online marketing to show impact on their bottom line or customer base. Some of these companies’ bread and butter comes off the Internet.
The digital media ecosystem is complex, yet when it comes to digital media planning, there are templates of search, social, video and some bits display. Performance advertisers are cautious with display advertising just as brand advertisers stay away from paid search marketing.
RTB (real-time bidding) as a concept has been prevalent over the last two years, however, it has its ups and downs. While other markets are ahead of India, the country has its own story to tell.
Below are factors affecting the current state of RTB in India:
1. Low appetite for risk taking. A classic Internet advertising problem where performance advertisers don’t want to own the risk. They will engage with an online service provider and do a cost per acquisition or sale deal ensuring that the performance metrics are the only means of issuing a payout.
They’re open to compromise on brand safety and only focus on the cheapest result with least risk. This has worked so far but now there are challenges on where the traffic is coming from. How do you ensure there’s no duplication of effort and no argument on a true sale or acquisition (fragmented ecosystem and non-linear customer paths)?
In essence, only a handful of advertisers really want to own the risk and focus on digital spends effectively. Outsourcing risk will continue until advertisers focus on bringing the efforts in-house.
2. Template digital media mix and mass marketing. What’s popular on the Internet gets the biggest pie of the marketing rupees whether it makes sense or not. The “what is my competition doing?” and “copy with pride mantra” is in no way true management of digital media spend. However, no one wants to leave the comfort zone.
Reach and frequency metrics as well as methodology have very much stuck with offline planning despite the availability of similar tools and technology from the digital media side virtually for free. The reason why is beyond the scope of this column.
However, I challenge advertisers to review your last 10 digital media plans and see if you have done something creatively or differently. Have you as an advertiser really used technology? Have your communication/brand strategies evolved or are they stuck in a limbo? Has your marketing plan been disruptive or repetitive? And do the same with your traditional plans. You will see the difference.
a. “Discount Kitna Hai” (how much is the discount) and CPC buy. Internet has been sold wrongly for a long time and it’s difficult to change the mindset in the correct direction. There was a recent article, which highlighted this fact. And, yes, Internet was/has/is being sold wrongly.
While every advertiser wants a CPC (cost per click) buy, RTB only works on a CPM (cost per thousand impressions) buy. There are no bulk deals with middlemen. You bid the price you think as an advertiser is worth the value it brings to your marketing campaigns.
With digital being the last mile in the overall media planning, what’s left is just a tiny fraction of the total spend. That won’t work either in an RTB scenario.
3. Lack understanding of scalability. Internet advertising is all about scale. However, less than 10 percent of advertisers have gotten their infrastructure together. This doesn’t include the largest spenders in digital (surprise!). Technology and marketing still continue to be two different expense buckets in organizations. Without technology, you cannot achieve scale in online advertising and without scale you are just another drop in the Internet ocean with limited understanding of your audience as well as the constant nag that “display doesn’t work.”
Another reason for lack of scale is the sheer investment in digital media. Except for large advertisers that invest upwards of 50 percent of their marketing money online, most are only investing 2 to 5 percent on digital spend. The industry needs to spend on average 10 percent online, otherwise scale is complicated.
The remaining have just ignored the problem of scale by stating it’s impossible to achieve that or passed the buck to their agencies.
4. Everything on the Internet is the same. Even though marketers are exposed to those user paths to conversion charts and attribution, most marketers strongly believe that the Internet is just buying a combination of the top five sites in India, so there’s not much innovation happening there.
When it comes to remarketing, most advertisers are just using the original creatives without intelligently changing the communication strategy. The same-user-same-message approach is creating blind spots and setup for failure, making a lot of advertisers believe that display advertising doesn’t work.
5. Silos are created on purpose to get cheap-fix solutions. This is a shocker, but most advertisers prefer to work with many partners so that they can leverage talent/ideas across the board.
In reality, this slows down and complicates decision-making for any online marketing plan. It also fragments audience information that’s currently created in separate silos. Most people are resistant to the idea of consolidating their digital audiences. Yet, a lot of people say innovation is missing in digital.
6. Dots are not connected. Attribution and using the interplay of different touch points online are not used. There is enough research to prove this point, like this recent report by Boston Consulting Group, where you can save 33 percent of your time by integrating with a singular platform solution.
Once you connect the dots, you’ll see how in-sync your digital play is. This will help in taking RTB conversation on a serious note as audience buy is very different from the usual inventory buy method. It allows you to know which levers to change and what will be the outcomes – irrespective if it’s a brand campaign or a performance acquisition campaign. Consolidation brings clarity and control.
Success in RTB depends on consolidation, data management, creative management, as well as audience measurement. All of these are enabled using technology.
RTB and audience solutions are available in India. However, only a handful of advertisers are really benefitting from what it brings to the table.
It’s evident from this RTB digital display ad spend chart, which shows how investments are shifting to programmatic in the display space.
India is just getting started. RTB is here to stay for sure and its growth is just a matter of time.
27-year-old Swede Felix Kjellberg, who goes by the name PewDiePie on YouTube, has found himself at the center of a firestorm.
The explosive growth of video in 2016 makes 2017 an important year for video content and as more publishers are tempted to use it, it’s useful to consider the best strategies to maximise its effectiveness.
Apple has announced that with the next update to iOS 10, they will limit the number of times an app owner can pester a user for a rating.
Last week, PageFair released its 2017 Adblock Report, and the news was not good for publishers and advertisers.