Digital in 2011

   

Digital in 2011 ...

2010 has been a year of consolidation for online marketers, and the economic downturn has led to brands focusing on ROI and efficiencies more than ever before. Growth in Paid search revenues have been complemented with growth in the display market in H1 2010 of 6.4% (source: IABPwC Online Adspend Study H12010)

Performance channels such as affiliate marketing, lead generation and some forms of email marketing have flourished, offering a low risk, fixed cost opportunity to generate high volumes of leads or actions. In addition, re-targeting technology is now a crucial part of the online marketing mix, allowing brands to differentiate between new prospects to a site, ‘warm leads’ (consumers who have visited the site before) and to further differentiate between types of site visitors by the pages or products they viewed on site and to then target each segment with tailored ads. Online video advertising has also shown significant growth as more brands attempt to cut through with creativity, with ad spends up 82% year on year.

The future of online display

The online advertising market has become increasingly fragmented and duplicated, with inventory available from more sources than ever before – direct from the publisher, via sales houses, ad networks, audience networks and, more recently, ad exchanges. One key challenge in 2011 is for Brands to understand the planning and buying process and when they should choose one access method over another.

The Google Display Network

The Google Display Network combines specific site targeting, contextual targeting, interest-based targeting and re-targeting in an auction environment. Bids can be adjusted depending on the relevance and likely conversion metrics expected from each site, keyword, etc. and CPMs are considerably lower than those achieved in network buys because there is no middle man. As a result, campaigns running on the GDN tend to drive high volume that is also extremely cost efficient.

Why use ad exchanges?

Similarly to the Google Display Network, ad exchanges enable the automated buying and selling of online media, on an impression by impression basis. There is a huge amount of inventory available on the ad exchanges, including sites that are also on the GDN.

The ad exchanges allow advertisers to pay much closer attention to the performance of their campaigns and to the users they are targeting. Although they are more time consuming to manage, ad exchanges allow for more frequent optimisation, more creative in the mix and more testing, squeezing more value out of advertiser budgets and, in theory, ultimately generating more efficient results.

Unlike the blind ad networks, and similarly to the GDN, advertisers can have visibility of the websites they have selected and the websites on which they have appeared. Depending on how they are accessed, one of the major benefits of using the ad exchanges is the fact that data and learnings are owned by the advertiser, not by ad networks.

Do the ad networks still have a role to play?

Network buys specialising in specific types of targeting should still be considered when planning overall digital strategy but it is important to note that they will need to work much harder than the auction-based media buys because of the higher costs. Many brands are now considering display to be an important part of their core media strategy, due to the cost efficiencies possible and the high volume available through the channel, and in many cases it is capable of competing with CPA (cost per action) performance channels such as affiliate networks and online lead generation. 

The huge scale provided by the GDN and the ad exchanges means they should always be considered as part of any brand awareness campaign. However, frequency and impact are also important considerations, and therefore the planning approach may need to be adjusted to include integrated deals via direct site buys using high impact formats.

Rich Media

Many brands are segmenting their audience and utilising re-targeting, but in order to unleash the full power of re-targeting creative versions should be tailored to the individual audience segment.

Exploring the technical capabilities of Rich media formats should be high on the to-do list of all marketers in 2011 when building integrated Brand building deals. Developing high impact, interactive formats that will engage the audience and give great visibility online can also provide a raft of additional reporting, demonstrating how users are interacting with the brand and the creative and providing additional valuable insight to any campaign.

Mobile

Mobile use is growing rapidly – there are now 17m mobile web users in the UK (44% growth year on year). Mobile is set to be the biggest growing area in terms of search and display ads in 2011.

The rise of mobile display networks opens up huge opportunities for mobile display advertising. Standard display advertising will appear on mobiles but is unlikely to appear in-app or on mobile-formatted websites (due to creative requirements) – it is therefore unlikely to deliver much mobile traffic to advertiser websites.

Ads can now be bought at a relatively low cost, and broad contextual targeting, e.g. sports, can be applied, along with network, device, location targeting etc. At present gender, age, contextual keyword and behavioural targeting cannot be applied, but we expect this to be introduced later this year.

All in all a very busy and exciting year for online marketers and their Agencies with new technologies to master for campaign optimisation and Rich Formats and targeting capabilities to exploit for cut through and efficiency – exciting times!

   

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