Advertising Isn’t Dead…Yet
By Keith Selvin
First off, let me just say that I’m a sucker for good advertising. Awesome branded content, highly personalized and well-placed remarketing campaigns, Google Ad results that show me exactly what I was looking for – I love it all. But I think it’s safe to say consumers are getting really good at finding ways to block out advertising. TiVo, streaming, ad blockers, spam filters – the list goes on.
To be fair, marketers have gotten smarter too. Bogus ads and landing pages designed only to flood your inbox with irrelevant and uninteresting offers is largely a thing of the past. It doesn’t take being a digital native anymore to have a finely-tuned “marketing BS-meter”.
Even my 93-year-old Grandma Jean knows not to click on silly, too-good-to-be-true offers anymore (for the most part – yes, Grandma, I promise there’s no such thing as $9/month car insurance).
Look, there’s a reason that $72.5 billion was spent on digital advertising in 2016 (22% more than 2015). It works. The ROI is there. We’re getting smarter at targeting the right customers, in the right place, at the right time. But there’s an inherent problem with this: now everybody wants in.
It’s not just big companies anymore that have figured out effective, programmatic, targeted ad-buying. Pretty much everyone has it figured out now. Over the next 10 years, two critical things will happen:
Marketing costs will continue to rise.
Today, Facebook impressions are cheap – whether it’s pennies or dollars, your industry’s CPM on major platforms is going to increase 10x in as many years. But customer lifetime value isn’t following suit, which means one thing: margin compression.
It’ll be harder to break through the noise.
Consumers now have access to so much information, and so many offers, it’s difficult to know where to look to find the right solution. The key is to give consumers simple and easy ways to solve their problems. If it’s too hard to make a decision, I’m just going to give up and go with the first option presented to me, cutting your company’s entire value-prop off at the knees.
Oversaturation leads to increased supply-side cost, and decreased demand-side attention. That’s a recipe for disaster, and requires a way out. Think 2nd Law of Thermodynamics: high-pressure to low-pressure.
“Okay – so what do I do now?”
Well the good news is, there’s no shortage of new and innovative ways to get in front of potential customers. Direct mail is making a comeback (I know, not new and innovative, but it certainly bucks the digital trend). Content marketing is growing if you’re in the right space. However, we think partnership marketing is the next frontier.
Let me give you an example:
You’re just about ready to buy your first house. There’s six million things on your to-do list. Get the best possible mortgage rate, find a moving company, figure out cable and internet, look into a landscaper, install a home-security system, find homeowner’s insurance, look into getting a new car insurance quote while you’re at it, get an estimate on house painters because “eggshell white just doesn’t match our esthetic, hun”.
What do you do?
It’s daunting. There’s a ton of research that needs to be done. Reviews to read. Questions to ask. Quotes and estimates to receive. Decisions to make.
What if a single trusted company could point you in the right direction? Perhaps, by doing business with one reliable brand, you were then shown several others – with all of your options at your fingertips – no research required? What if you and your business were one of those brands? What do you think your conversion rate would be? Probably better than Google Adwords.
The beauty in partnership marketing isn’t necessarily exclusivity. It’s that it provides a path of least resistance. It cuts through the noise. It positions your brand, or service, or product, as one that can be inherently trusted, since it’s being recommended by a company the consumer is already doing business with.