“Data Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is by Sid Shah, Director of Business Analytics for Advertising Solutions, Adobe.
A combination of established trends and new technology innovations will cause 2013 to be an eventful year for digital marketing. Here are a few broad themes I expect to dominate marketers' attention in the coming year.
Mobile traffic will continue to sharply rise. In mid-2011, I predicted that one in five paid search clicks would come from a mobile device by the end of 2012, which seemed ambitious. It turns out that mobile traffic has already reached that mark. Indeed, by the end of 2013, one in three paid clicks could come from a tablet or smartphone.
Source: Adobe Marketing Cloud data
Cross-channel and cross-device measurement will become paramount
Until now, marketers have measured the efficacy of their digital campaigns with a simple last-click approach. This worked well because the majority of customers were clicking on ads and then immediately making a purchase. However, the increased use of mobile devices and the emergence of new marketing channels like social media have precipitated a fundamental shift in consumer purchase patterns online. First, consumers are researching products more than ever before on multiple devices at different points in the sales cycle. Second, the online and offline worlds are blurring with mobile devices as consumers often look to store information, reviews, locations, etc. on their smartphones. Finally, social media has made word-of-mouth marketing ever more important as consumers look for referrals before committing to buy a product or a service.
As the world continues to use multiple devices across various channels, it will become vital to measure the consumer journey across channels and devices to understand the true value of an advertisement. For instance, some marketers feel that smartphone clicks do not convert customers and they are not willing to invest in paid smartphone clicks. However, in many cases, smartphone searches lead to increased traffic in stores, which is not captured with conventional last-click measurement techniques.
Today, cross-channel measurement is done via heuristic attribution techniques that assign a predefined fractional value of a conversion to different touch points in the sales funnel. Although useful and insightful, these approaches are quite limited and often inaccurate in predicting the right media mix for maximum campaign effectiveness. While the right approach is to use algorithms built on top of extremely granular funnel-level data, doing so currently requires significant human input for data collection and analysis.
In 2013, we can expect continued evolution of cross-channel measurement products from both a reporting and analytics standpoint. Facebook and Google have an advantage on the cross-device measurement front as users log into both these services across devices (e.g., desktops, smartphones, tablets). Therefore, search engines might provide advertisers with purchase funnel data with device information. Algorithms-based media mix recommendation products will become more mainstream. As a result, we will see the evolution of cross-channel measurement from attribution to something more real-time, actionable and accurate.
Marketing will become even more granular
Marketers dream to reach every consumer with the right message, at the right time, and with the right context. While display marketers have seen whiffs of this with real-time bidding (RTB) and behavioral targeting, truly granular targeting with a cross channel element has yet to be realized. However, several recent innovations indicate that this is changing. For instance, Facebook has moved far beyond basic demographic and interest-level targeting with Custom Audiences, where advertisers can use Sponsored Stories or Ads to target a specific set of users with whom they have already established a relationship off Facebook. Google Shopping has evolved into a paid model. Here marketers can advertise at a very granular (even SKU) level and on various attributes of the product such as color, condition etc.
Is all this targeting beneficial or is it just an additional headache for marketers? All signs indicate that while increased targeting poses challenges, with the right technology and scalable algorithmic approach, marketers can gain significant performance improvements.
Marketers will understand the true value of Social
A common refrain among online marketers is that “social media doesn’t work.” This view is especially prevalent among direct response marketers who are used to the notion of immediate purchases after an ad was clicked. This is bound to change next year. For one, marketers are finally beginning to understand that the value of a social click goes far beyond the initial purchase. It is about building relationships with customers and also gaining access to larger audiences via the inherent viral nature of social networks. Marketers are beginning to understand this fact. Facebook, apart from introducing new ad formats, has now enabled advertisers to track “view-throughs” and initial results are very promising. Furthermore, I expect the Facebook Exchange to be quite successful. One also anticipates that Twitter, which recently had its high mobile ad revenues featured in an eMarketer report, will move beyond sponsored tweets and provide advertisers with more advertising formats and targeting options.
Finally, to gear up for the coming year, advertisers would do well to notice the rising complexity of digital marketing overall. Even in search, which was once a relatively simple affair, a well-run search campaign that contained a few thousand keywords now contains millions of keywords with several layers of targeting – geolocation, remarketing , device, etc. Social advertising is becoming increasingly complex with Facebook introducing several new formats nearly every month. YouTube and other forms of online video advertising are growing in importance. Therefore, it is imperative for savvy marketers to augment their teams with sophisticated cross-channel marketing platforms that enable them to scale in an efficient manner. Here’s to the year ahead in online marketing.