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Why Digital Marketing Strategy is so Hard

2012 February 29
Digital Strategy

Sun Tzu, the legendary chinese military thinker, wrote that “Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.”

The fundamental problem of strategy is developing a coherent logic for making choices.  To achieve that logic, strategists need to not only understand the objectives to be achieved, but the tactics that will get them there. You can’t, as many would have us believe, separate strategy from implementation.
 
Nowhere is that burden as heavy as in digital marketing strategy. Practitioners need to master an incredibly diverse amount of activity.  From creating a message that resonates, to reaching the right people at the right time in the right amounts to the technology that will deliver the message, digital strategists must integrate skills that have long been siloed.

Creative Account Planning

Creative agencies flourished in the golden age of TV.  Legends like Leo Burnett, Bill Bernbach and David Ogilvy crafted messages that built the world’s great brands.  They had an intuitive  sense of what the consumer wanted and how to communicate in a clever, effective way that sent product flying off the shelves.  Everything was about the “big idea.”

Theirs was a fairly homogeneous society, with the post-war economic boom sending the masses to the suburbs, they all needed cars, home appliances and prepared foods to live the “American Dream.” There were relatively few TV channels so consumers could be reached easily with mass messages.

Intuition, however, only goes so far.  In the 70’s and 80’s, things got decidedly more complex.  The cultural revolution changed lifestyles and the marketplace became less uniform.  Understanding basic human nature was no longer enough.  Marketers needed to understand the particular consumer most likely to buy their product.

That’s what gave rise to creative account planning.  They performed ethnographic studies, focus groups and the like, to get under the skin of different consumer groups and guide creative departments.

Communications Planning

Of course, it wasn’t just people that got more complex, but media too.  Cable and satellite fragmented media beyond recognition.  Marketers couldn’t depend on network TV to deliver everybody anymore.  Paid channels like HBO and Showtime, thematic channels like CNN and MTV and niche entertainment networks like USA and TNT chipped away.

The fragmentation of TV had a ripple effects.  Smaller print and radio audiences became more viable, billboards became more “mass” and people came to define themselves increasingly by the media they consumed.  It wasn’t enough to have a “big idea” anymore, you had to reach the right target.  The media, in a very real way, became the message.

That was the rationale behind communications planning.  Media independents spun off from the full service agencies and developed their own brand of strategy.  They developed mathematical models, powerful software systems and strategic frameworks all in the service of reaching the right person, at the right time for the right price.

Digital technology has accelerated the process further.  Cord cutting is starting to make an impact, while video on demand, tablets, YouTube, Netflix and Hulu are creating fragmentation of not only audiences and programming, but time and place.

Technological Evolution

Clearly, the rise of the Internet has created a new level of complexity,  Not only do marketers need to reach the right people at the right time at the right price with the right message, but they also need to do it with the right technology.  Further, just to make the whole trapeze act a bit more interesting, the technology keeps changing!

How does it change?  Here are the factors involved:

Digital Laws:  The efficiency of processors, storage and bandwidth progress at fairly well understood rates.  These determine what kinds of technology are possible at any given time.  We can expect these digital laws to stay fairly constant until 2020, when a new technological paradigm is likely to emerge.

Technological Forces: While the digital laws determine contraints, four technological forces drive what kinds of things we build.  The cloud, smarter screens brought about by advances in client side scripting, linked data and an explosion in the number of mobile computing entities are what drive innovation today.

Digital Trends: Viable trends arise when two or more of the technological forces combine to create something new.  For instance, the cloud, smarter screens and higher penetration of post-PC mobile devices are combining to create a revolution in living room entertainment.  Mobile devices and the cloud are combining to create apps for political activism and so on.

From Modular to Integrated

Insight into the consumer mind set, effective quantitative assessment of the efficiency of communication channels and an understanding of how technology evolves requires a very diverse set of skills unlikely to be found in one person or even in one group of people.  That brings us to the real problem with digital marketing strategy.

Harvard’s Clayton Christensen, in his book The Innovator’s Solution, makes the apt point that industries are organized in one of two ways:

Integrated Organization: When things are new, not well understood and operational interfaces are weak.  Problems lack standard solutions.  Therefore, people need to be close to each other and communication has to be very intense. A good example would be the early auto factory where raw materials went in the front and cars came out the back.

Modular Organization: When an industry becomes more mature, interfaces improve. Standard solutions to basic problems emerge and communication becomes more formalized.  Firms begin to specialize in different parts of the process, much like the auto industry today, which is comprised of thousands of components suppliers.

To a large degree, that is the fundamental difference between Apple and Microsoft. Apple, is intensely integrated, which allows it to innovate seamlessly.  Microsoft works on a more modular platform and stubbles early on in technology cycles, but tends to catch up when scale and efficiency become advantageous.

The Essense of the Digital Marketing Strategy Problem

The marketing industry has spent the last several decades becoming more modular and efficient, but now finds it needs to become more integrated and innovative.  That’s the essence of the digital strategy problem.  An industry that manages billions of dollars of investment every year can’t simply turn on a dime.

What they can do, however, is recognize the problem.  Creative agencies, media houses and digital shops all have specific skills that will serve them well in the digital age.  They also have serious deficiencies that they must overcome.  The message, the economics and the technology all must work together.  There are no half solutions.

Walls are breaking down, between creative and media, digital and analog and even between publishers and ad agencies.  To win in an integrated marketplace, there must be a integrated mindset.

– Greg

9 Responses leave one →
  1. FCP permalink
    March 1, 2012

    Very interesting and extremely well written.

    [Reply]

    Greg Reply:

    Thank you

    – Greg

    [Reply]

  2. April 30, 2012

    Great insight and history. Thank you for writing this.

    I agree with the thought that the walls are breaking down. Some of that has to do with the successful emphasis of storytelling to engage conversation with key audiences.

    In presenting more opportunities to be transparent, brands/advertisers/creatives/ producers are gaining ground in segmented channels.

    Exciting times!
    Robert Luna´s last blog post ..Brain Scan PSA for Alzheimer Society of BC – powerful storytelling

    [Reply]

    Greg Reply:

    Indeed they are! Thanks Robert.

    – Greg

    [Reply]

  3. Chris Chaplow permalink
    May 1, 2012

    Greg “Marketers couldn’t depend on network TV to deliver everybody anymore.”
    Why do you have to deliver to everyone (in the city/country/world)?
    Is is not more about cost of delivery per target person. Or is it simply that, by economy of scale, that delivery to everyone is the lowest posible delivery cost per target person?

    [Reply]

    Greg Reply:

    Chris,

    I think there are two reasons you would want to target broadly. The first is that while a small business might be able to get ahead by reaching new consumers efficiently, a major marketer needs to reach a large percentage of the population. Moreover, their competitors are mspending heavily, so whoever they aren’t reaching, their rivals are. Therefore,the ability to reach 60% or 70% of the population cheaply is very important.

    Secondly, target definition is extremely difficult, especially for new products and offers. While we like to think that we can define targets accurately and there is no shortage of people who will tell you that they have a surefire method (demographic, behavioral, social, retargeting, etc.) targeting is a very inexact science. That’s why major marketers will run a variety of targeting schemes as well as mass campaigns.

    – Greg

    [Reply]

  4. July 26, 2012

    While it’s true that the ever-evolving nature of digital marketing is what makes it difficult, it also opens the door to unlimited creativity and more efficient and inspired ways of getting things done.
    Pageonepower´s last blog post ..Digital Marketing Depot & Page One Power Collaborate for Webcast

    [Reply]

  5. August 15, 2014

    I really enjoyed this article and especially liked the breakdown of technology revolution. I learned a lot from a recent podcast /i listened to on Digital Marketing (http://www.speakingofwealth.com/2014/07/sow-152-digital-marketing-explained-with-jamie-turner/) which gave a nice perspective and information to help writers, like myself, advance our work. Again, your article is great and I will reference back as I continue marketing my work.

    [Reply]

    Greg Reply:

    Thanks for the tip Carrie.

    Greg

    [Reply]

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