Looking to catch someone’s eye? Be ready to pay for it.
Each February, advertisers line up (each with roughly $5.5M in hand) to fill one of approximately 85 Super Bowl 30-second advertising spots. We did the math for you — that’s almost half a billion dollars in ad revenue alone. And this past year was considered a “light” year due to the ongoing pandemic and absence of some usual big names.
This year’s Big Game also birthed new ads from financial incumbents and upstarts alike including Intuit, Robinhood, Quicken, eTrade, and Klarna, all of whom went about garnering attention in different ways. Their end game was the same: get noticed and get noticed quickly.
Since its inception, TV has been the primary vehicle in which financial services companies could sing their (own) praises and bring carefully tailored messages to customers and prospects alike. But over the last decade the media landscape has spiraled toward a confusing, wasteful place filled with expensive incumbents like Google, noisy social channels, and a cloudy mobile and programmatic approach. Not to mention upstart streaming platforms still trying to define the next era of jarring placements.
The COVID Media Shift
According to a December 2020 report, media buyers assigned more than half of U.S. advertising spending (51%) to digital platforms like Amazon, Google, and Facebook. It’s been proven that media consumption shifted across literally all generations due to COVID-19 quarantines and work-from-home realities. Because of this “new normal,” digital platforms like Snapchat, Instagram, and Google’s parent company, Alphabet, posted significant gains while the many of our beloved hospitality businesses fell apart.
Alphabet reported robust third-quarter numbers ($26.3B) with 6 percent gains in ad revenues last year. Pinterest reported a 2020 third-quarter revenue spike of 58 percent, catapulting it to $443 million.With $678.7 million in hand, Snapchat netted a 52 percent YOY increase from 2019 to 2020. It makes sense, but it also shows how much room these companies had for growth with new demographics jumping onboard.
With the accelerated shift to digital, we now face a reckoning that has been brewing in the media landscape for nearly a decade: inflated results and fraudulent returns.
Fraudulent Returns, Inflated Results
Ad fraud takes place any time service providers fraudulently represent clicks, impressions, conversion, or data events in hopes of boosting revenue without human intervention. That means your numbers are going up, but no real people actually see your ads. Within the next five years, digital advertisers will waste up to $100 million a day due to ad fraud. (The Waste in Advertising: Stats and Solutions of Misattribution)
That’s a lot of zeros.
Just take a look around — the effects are being felt by CMOs across all industries. Although marketers intend to boost investments in online video advertising, more than 70 percent admit that negative news headlines have impacted video spend, with 21 percent reducing investments in specific channels. (CMO Council).
Inaccurate, questionable, or false digital media reporting have led 21% of marketers to cut back on their advertising spend. In fact, more than half of ad spend showed negative or non-measured ROI. (Marketing Dive).
75% of brands reported at least one brand-unsafe exposure in the past year, with Facebook being the least safe. At best, these incidents lead to brand confusion and, in extreme cases, loss of revenue. (GumGum)
As cleanup has been incremental at best, with no industry-wide regulation being established, some major players have taken steps of their own in a reluctant nod toward transparency. After all, digital transformation must be targeted, measured, and tailored to be profitable. To add fuel to this dumpster fire, many marketing agencies are brokering media 2 and 3-times removed from the placement source, inflating true CPC and CPA costs by 20-30%. As as CMO, you’re getting less and less value for your dollars.
The Media Cookiepocalypse
For many years, marketers had the luxury of using cookies to track our website visitors, improve the content on websites, and collect data that helps us tighten our advertising targeting. Over time, privacy concerns (and some revenue opportunities in Big Tech) have steadily removed certain digital tracking capabilities.
Google’s January 2020 post on making the third-part cookie obsolete created quite the stir, much like Apple’s announcement on its stricter opt-in requirements for its IFDA (An Identifier For Advertisers) — which helps advertisers attribute mobile ad spending. Not all third-party tracking is going away, but legacy tracking styles won’t cut it much longer. Your data will be weaker and your more advanced targeting will be superficial.
Firefox and Safari have already phased out the third-party cookie, but Google’s announcement (and dominant share of browser traffic) obviously created a bit more panic. There will no doubt be more innovation in the digital media space as a result of these changes (see Unified ID 2.0 as an example), but it will take some time to create “what’s next.”
What’s Next For Media?
So, what are we to do?
A consistent yet targeted focus on mobile is a must. After all, mobile is where consumers live, work, and play. But, it’s not the only place where final purchase decisions are made. And that’s especially true of complex financial decisions. Yet, the modus operandi this past year has been to blindly pour money into mobile and the Facebook/Instagram ecosystem without much attention on the conversion experience.
“Winning will be playing in both [physical and digital] and adjusting resources depending on where [consumers] are on that journey,” said one consumer products executive. “It’s not a conflict or collisions, it’s where the consumer is going and where companies have to go.” (AlixPartners)
First-party is the best party. With the slow demise of the third-party cookie, many digital media companies are scrambling. You’ll need to make sure you have a better control of your first-party solutions and partners who understand how to connect the dots.
A renewed investment in landing pages and conversion performance. Just being there “digitally” isn’t good enough. You need to enable your prospective customers or members to take action. And if that means spending more on an improved landing page or short, guided application (and less on advertising temporarily), then shift your investment and it will pay off when you increase your spend again.
Streaming advertising is still evolving. Although the cost-per-thousand on digital TV has gone up, these channels continue to be in demand. As TV and audio providers continue to alter their impression and engagement models, the space will unlock new opporuntities to get in front of your most financially “active” customers.
Connecting the dots between adtech, martech, and operational tech will be paramount. You’ve got a lot of tools in the toolbox now. Whether you have a CRM, marketing automation system, media analytics, or social listening tool, you’ll have to find new ways to connect the dots between these disparate modern marketing softwares. Those who glue will glean the clearest picture of media performance.
Social is demographically fragmented and influence has authenticity challenges. Costs are still relatively low on Facebook, Snapchat and newer platforms like TikTok, but integrated strategies with content are paramount here. LinkedIn has potential with the right commercial strategy and understanding of CPL and CPA. And “influencers,” however big or small their circles, have their place, but have to be used wisely as part of a niche or greater, integrated plan.
2021’s been more digital than any year before. And 2022 will only see a larger share of digital eyeballs. But with the media and marketing technology landscape continuing to evolve rapidly, your challenge to effectively spend, track, and optimize will only increase. Knowing where, and most importantly why, you are spending your media dollars will help you find your efficient and effective sweet spot.