5 Problems Digital Media Needs to Solve
Is Digital Media taking over? Not according to the data. With digital at 12% of global media spend, 88% still goes where it always went.
The web is the most rapidly adopted technology in history, spreading across the globe in less than a decade and gaining penetration even in areas that are desperately poor. It’s hard to think of a more transformative technology.
That’s what makes the relative failure of digital media that much more astounding. It took 15 years to break 10% market share and will probably take at least another decade to reach the current levels of TV.
As Much as Things Change, They Stay the Same
What’s really startling about the media revolution is how well “old media” has held up. Time Inc. is still the biggest magazine publisher, network TV still tops the ratings, and Disney still dominates children’s entertainment.
How many digital brands have shown anything approaching that kind of lasting power?
Of all the major portals from a decade ago, only Yahoo! remains as a serious player. MySpace and Friendster, while it’s too early to count them out, have seemed unable to ride the social media wave to profitability. The list of digital roadkill is endless.
The difference between failure and survival is the ability to continue to evolve after some initial successes have been won. While digital media will march on, it’s still an open question whether most digital brands will still be here a decade from now.
5 Problems Digital Media Needs to Solve
1. Know Your Clients: One of the most frustrating things for marketers about Digital Media is how little new media professionals know about the traditional media that makes up nearly 90% of advertising activity. Many digital media advocates seem to assume that the entire marketing world has been asleep for the past 50 years, just waiting for them to come along.
Make no mistake, the world’s premier marketers got to be that way by knowing their jobs well and adapting to new challenges effectively. If they are uninterested in what you are selling, there is probably a reason beyond “they have their heads in the sand and will come around eventually.”
A typical frustration encountered by media auditors is hearing how a digital supplier achieved “superior” results though optimization, yet those results coincided with a TV campaign and decayed when it went off air. The result was a laughable ROI calculation and a complete loss of credibility.
2. Prove Results Beyond Direct Response: Most of the past gains digital media has won have been at the expense of direct response marketing. In fact, the 13% share drop of US newspaper revenues explains virtually all of the increase in Digital Media (and newspapers have historically been highly dependent on classified advertising).
Forrester Research, where the rosiest of digital scenarios are sure to be found, recently released a report, US Interactive Marketing Forecast, 2009 to 2014 (pdf). In their survey, when they asked what budget will be decreased in order to fund interactive, the largest response by far was Direct Mail (40%) followed by Newspapers (35%).
The only display advertising medium that the marketers surveyed planned to decrease in any significant amounts was magazines, coming in a distant third at 28%. No other activity showed much response at all to the question. Moreover, as I wrote before, there is good reason to believe the downturn in magazines is cyclical.
I should note here that I have some problems with the survey, but it is striking that a report that so clearly advocates a digital point of view shows so little progress for digital as a brand building medium.
3. Know Your Consumers: One of the major barriers to bigger display budgets for Digital Media is a lack of data about audiences, especially digital video. While the number of views is easy to count, there is very little understanding about who is viewing, their psychographic characteristics, product consumption preferences, etc.
This is a relatively easy problem to fix and certainly the possibilities of Digital Media are enormous in this area. However, a better understanding of how marketers make decisions is required. Traditional media companies have built up decades of wisdom and experience in this area. Digital Media still has to learn.
4. Effective Frequency: As I pointed out in an earlier post, one great advantage that Digital Media does have is the ability to control frequency. In traditional media, that’s where the bulk of the money is wasted.
Unfortunately, there is very little understanding of what levels of frequency are effective for different digital tasks. Traditional media worked for decades to gain a thorough understanding of frequency. Digital Media still has to start.
5. How Precise to Target: In traditional marketing, targeting is mainly an efficiency issue. Money is spent on media that has a higher proportion of a certain kind of consumer than others. In actuality, they are reaching far more people than are targeted.
In Digital Media, however, ads can be shown to only those that are targeted. While that can prevent wastage, it can also exclude viable consumers and influencers. If Digital Media is to service mass marketers effectively, a more sophisticated view of targeting will be needed.
We have to be careful what we wish for. When our ability to meet media targets exceeds our ability to evaluate marketing targets, those targets become meaningless. Consumers are often more complex than we give them credit for.
Those Who Adapt Will Survive
While many in the digital world take a “they’ll come around eventually” point of view, some of the smartest players do not. Yahoo! has built a very strong display advertising business and even Google seems to be steering their business more towards brand building.
Media is like any other industry. In order to be successful, you need to fulfill needs that your customers actually have rather than the needs you think they should have.
Before you can educate your clients, you first need to educate yourself.