New trends suggest a strong move back to traditional advertising
Everywhere you turn, bloggers and marketing insiders are squawking about social media, SEO and search engine marketing. Those activities are definitely important, and they represent a growing focus for most companies. Yet, something interesting is going on in the background:
While the general ad industry and press corps obsess over inbound marketing, search optimization and PPC ads, the smart money is doubling down on TV, radio and outdoor.
There are several theories bandied about. For one, there’s a lot of value to be had as traditional advertising pricing has remained flat, and resourceful media companies can deliver their clients a huge return on their advertising dollar. Companies are allocating more budget to digital, so there’s been some downward pressure on demand for traditional ads.
Other theories are a bit more subtle.
Content marketing, the “WhatsApp” effect, and the rise of “click bots”
Content marketing is often touted as the panacea for smaller businesses that have a hard time justifying media buying outlays. This is where you produce blog, podcast or YouTube content on a regular basis in order to draw search traffic, exposure to journalists and actual eyeballs of customers.
It is profoundly difficult, however, to get content marketing campaigns off the ground. SEO and content marketing experts are quick to point out the “zero cost” features, but that’s deceptive. In order to be successful with inbound marketing, you have to create awesome content on a regular basis. And guess what? That costs money and takes a lot of time. Call it sweat equity, call it outsourced creative or whatever – but the fact remains, there are real costs associated with robust content marketing campaigns.
Another angle to explore is the WhatsApp effect. WhatsApp is the company Facebook just purchased for $19 billion. The interesting thing about WhatsApp is its founders’ original manifesto: “No Ads! No Games! No Gimmicks!” The app Facebook purchased has no advertising revenue model! The app is free for the first year, and users pay $0.99 per year thereafter.
So, here’s a company – Facebook – whose revenue model is based on placing ads in front of people while they’re “socializing,” and they purchase a company whose sole existence is based on users who don’t want to be advertised to. Incredible!
This subtle market indicator (if you consider $19B subtle) may confirm something we’ve suspected for quite some time now: There is significant erosion in digital ad purchasing because users are tired of being “monetized.” This one’s also from the WhatsApp manifesto: “Remember, when advertising is involved, you the user are the product.”
We’ll keep our eye on digital, but one thing is clear. . social media may not be the best place for brand promotion. There might even be a backlash in play. Remember, Google Plus has absolutely no advertising in its social feeds. Perhaps they’ve learned something from the mountains of data they’ve compiled about user behavior and online advertising.
Finally, click-bot issues have a lot of people troubled about online ads. The Wall Street Journal wrote an interesting piece about these “botnets” back in September. This is the practice of unleashing off-shore clicking scripts on ad networks in order to inflate the click-through rates on specific ads and put money into the pockets of the web sites that are displaying those ads via ad networks. The practice has put a chill on digital advertising and given rise to multiple industry-wide lawsuits.
A “Back to the Future” Approach
Our original observation about increasing traditional ad spend makes much more sense in light of these trends. There is movement back to traditional media. Companies are re-introducing, or re-acquainting themselves with radio and TV because the terrain is known and the results are time tested and proven. Consumers expect to see and hear ads in the expected places. And, perhaps more importantly, they know traditional media is not stalking their interests, cookies or social media behavior.
The billboard is not reading their search history. The radio ad does not have access to their circle of friends. The TV ad has no interest in anything other than an honest-to-goodness, old-fashioned one-way pitch. And isn’t that refreshing!
No question – digital is here to stay, and Vision Media has a practice dedicated to targeted digital media buying. We’re just seeing tremendous value in traditional media these days, because of the uncertainty, behavioral dynamics and shifting trends mentioned above.