End of Traditional Advertising- Growth of Online Engagement
It’s interesting to see just how much has changed in the world of marketing over the last 20 years. From 1839 when posters on private property were banned in London today’s approach to marketing is remarkably different. In 1867 we see the earliest recorded bill board rentals. In 1922 radio advertising commenced and in 1941 the first recorded use of television advertising took place. In the 1950s we saw the systematization of telemarketing and in the 1980s we saw the development of database marketing and the emergence of relationship marketing via the computer. But it has been in the last 20 years, particularly the last 10 years, that our approach to marketing has changed significantly from an off-line format to an on-line format; with Facebook launched in 2004, Twitter launched in 2006 and a whole load more to come into this new decade.
What does this mean for today’s businesses? Unfortunately, for some entrepreneurs, online marketing is something their competitors are engaged in, but they haven’t made the time to formulate their own strategy. Often they are relying on their old approaches as proven, tried and tested methods.
Here lies the problem: a lot of those old approaches no longer work.
There’s some obvious examples. For example the Yellow pages, at one time the marketing bible for small and medium sized businesses, but now producing poor Returns on Investment. The American company went bust and the UK publications have shrunk in size massively, yet still there are businesses that spend a large percentage of their marketing budget on it. Local newspapers are closing down due to loss of advertising revenue. Leaflet inserts and flyers are thrown in the bin even before people look at them. Television advertising is out of the reach of most SMEs, especially when a 30 second commercial during the final of the X Factor would cost £235k which is the equivalent to £8,000 per second. Give me the £235k and I’ll outperform the Return on Investment you get through television advertising every day of the week. This is increasingly worrying many TV executives as many have seen sales plummet. ITV’s revenue has decreased from £2,082mn in 2007 to £987mn in 2010. Interestingly enough the development of the Sky+ box means that it’s easier than ever to record programmes and start watching them 10 minutes after the original starting time but being able to fast forward through the adverts. These are worrying times for people whose businesses are based on traditional advertising models. (The one silver lining which will develop a renaissance in television advertising is dual screen watching, with those interacting with what they see on their screens with others on online platforms).
Newspapers have seen their share of total ad’s spend go from 27% in 2007 to 21.6% in 2011, whereas the internet has bucked the trend growing from 8.7% in 2007 to 14.6% in 2011. In contrast Google’s total revenue in 2007 was $16.6bn and had increased to $23.750bn in 2009. It’s not appropriate for a marketing executive, a business owner or entrepreneur to put his head in the sand and to ignore the changing landscape. These stat’s are worth noting and all businesses should be wise as to where they invest their marketing budget.
The great thing is, in comparison to spending money on adverts and television where you are left guessing what your return on investment is it’s very easy to be able to track your ROI through on-line data, as often this is integrated and provided for you through the platforms in which you engage. Accountability is crucial when it comes to your marketing spend. Have a look at Chris Sacca’s Foundation video as he explains the different ‘acts’ of online advertising.
So what should you be doing to be competitive on-line?
As a basic a website, a blog, good Twitter, Facebook, Pinterest interactions, good Search Engine Optimisation, Inbound Marketing strategy, YouTube videos and someone in-house or externally who knows how to manage and grow your communication and social media accounts.
But before you launch in, get your social media marketing strategy in place.
Having the right approach and the ongoing commitment to engage with your customer base. You don’t want simple web impressions, which really are just the equivalent to the old metrics of TV or Print, but instead you want customer engagement, loyal interested fans and people who want to keep in touch. That’s where you see the ROI come into it’s own. Tools come and go, and although these are all great and important, there is a great need for marketing that actually benefits the customer. Customers have become very adapt at drowning out noise.
What have you found to be the most effective route to market your product, service or company? I’d love to hear from you in the comments below.