Not revolutionary, but I’m starting with an absolute certainty. Online marketing spend increases will outstrip the growth rate of traditional media by several times – the insatiable lust the British public have for consuming content, and video in particular, via their smartphones shows no sign of abating. The rate of growth may be slowing but online media is still growing at a rate many times that of TV, despite 2016 numbers showing it already commanded nearly double the advertising spend. Anecdotally we’ve seen two of our largest clients move a large proportion of money away from TV and one stop TV advertising altogether – our client base is a small sample but it appears to be a national trend that continues.
Despite plenty of controversy around ad fraud, programmatic continues to grow rapidly (23.5% year-on-year according to eMarketer). Uncertainty around Brexit is likely to trigger greater short-termism which will mean further pressure on marketers to focus on paid. And where they do recognise the longer-term benefits of investing in a sustainable organic presence, paid will naturally play a role in the success of SEO campaigns. As a PR are you more likely to sell in your beautifully made video asset to a journalist or website editor when it’s been viewed by 200 users or 20,000? Investing in paid media to ensure your video is already being viewed and shared will increase the chances of the target journalist buying into the brand story you’re trying to tell and boost your chances of coverage.
The various controversies that brands such as Mercedes-Benz have found themselves embroiled in due to their ads appearing on porn or terror websites and the ever-increasing demands for transparency in 3rd party costs and commissions, means that brands will increasingly move away from the huge scale volume buys with big media buyers. It’s all too easy for an agency to buy large-scale media through a DSP and enter a few blacklisted contextual terms or URLs in, then tell clients that their brand is fully protected when it isn’t. Instead, I expect agencies to demonstrate to C-suite clients the brand and ROI benefit of investing in more expensive but far better targeted ads on selected sites, with the greater conversion rates and customer lifetime value that this brings. So, there will be a greater number of smaller volume campaigns at a greater cost, and a greater proportion will be built up from scratch to create a whitelist of publishers, rather than buying across a network and then trying to blacklist the controversial sites that a brand does not wish to appear on.
It won’t have escaped your notice that above I’ve talked about the on-going movement of budget from traditional media into digital media (note, there are nuances – radio and cinema are expected to hold up well, but TV, national and regional print news and print magazines will decline further). This creates an interesting dynamic amongst all-agency groups who are tasked by brands to work together to propose and execute campaigns that will best hit the KPIs set. It is entirely natural for an agency to argue for their channel given they are likely to have a greater understanding and body of evidence for their core work. Add to that unique dynamics such as the brand being 50% of an agency’s total revenue (so the revenue from that client is vital to the agency’s successful continuation as a business), or the owner of an agency being on an earn-out so willing to aggressively fight for budget in the short-term without worrying about the impact on the longer-term client relationship, and you have an unsustainable all agency group dynamic that is very unlikely to propose the optimum channel mix.
So how do clients get around this? If I was a senior cross-channel media strategist I’d be opening up conversations with a small number of clients about part-time in-house roles and if I was a client I’d be looking out for these people and using them to oversee the all-agency channel split so that the justification for spend is entirely evidence-based. It may only need one or two days per week on average across a year but there may be short periods when it’s a nearly full time undertaking for a cross-channel media planner to ensure that inherent biases and agency self-interest don’t impact negatively on client returns.
We’re lucky at Propellernet that we work with some big brands and as a consequence, we have some clients on three-year contracts, but it’s amazing how many clients still operate on a one year contract for SEO. It’s a channel that requires brand understanding and mid/long-term planning just as other marketing channels are. Global 40 research suggests that the average brand/agency relationship is just 3.2 years which would suggest that marketers aren’t getting the advantages of agencies that can be trusted to operate as an extension of their team as much as they should. Even though – or perhaps because – the average tenure of a Marketing Director in the UK is just 18 months†, the benefits of mid-term (and 3 years is not long-term) partnerships with agencies should be self-evident. You can contact me via firstname.lastname@example.org if you’d like to chew the fat on this!
Brexit means that as we enter FY20 marketing spend will be squeezed. Brands may well contract spend until they start to see the wider impact of Brexit for their consumers and therefore on their business. This offers an opportunity for some. A greater chance of unused inventory and a general nervousness means that brands that are willing to be aggressive (and have products to be proud of) will be able to grab market share from more cautious competitors, taking advantage of rate fluctuations for inventory that publishers are finding it harder to shift. And we can be pretty confident that approach will be successful because of the various IPA studies that demonstrate that a 10% difference between Share of Voice and Share of Market leads to an average 0.5% of extra market share growth (see point 9 in this BBH piece).
†Marketing Society figures as quoted by Marketing Week