Digital needs to grow up in 2017

When TV ratings started to dip a few years ago the online industry were quick to trumpet their own growth in comparison. But in a reversal of fortune it is digital that is now under the scanner as critics have highlighted fundamental issues with measurement, viewability and fraud.

From just $3.13bn in 2012 to $6.8bn in 2016, digital media has been growing very quickly at an approximate annual growth of 20%. But just as the onset of adolescence is often accompanied by troubled times and accusations of misjudgment, digital has become a magnet for criticism from all quarters in trade media. Although I am a digital specialist I think the channel needs to stop projecting itself as the new kid on the playground, with the shinier shoes and gear and take a hard look at itself.

In my personal opinion there are six deliverables that are reasonable for a marketer to expect of an established media channel. The six are in no particular order: Audience reach, Costs transparency, skilled workforce, improvement in customer experience, marketing effectiveness and robust measurement. In this post I use these six parameters to assess the current challenges that digital as a channel faces and offer possible solutions for consideration.

  1. Delivery of audience reach:

“Is the advertising reaching my audience”

The challenge: Digital tactics like search and social reach more than 80% of the population but not all reach is good reach. This is especially true in digital where media is largely bought and sold in impressions. If an impression is non-viewable, fraudulent or appears on a brand-unsafe website the reach delivered is actually undesirable. Viewability in Australia stands at 49.3%, Ad blocking at 27% and ad fraud amounts to $120mn locally. If you were an advertiser you’d be understandably worried about the worth of your online investment.

The solution: All stakeholders in the digital ecosystem should agree to 3rd party and independent auditing measures. Associated technology and verification costs must be shared as in the long run viewable and verified impressions will lead to advertising reaching the most relevant consumers and better financial outcomes for all.

2. Transparency in costs:

“I want to know what I’m being charged for”

The challenge: The increasingly complex digital media ecosystem has simultaneously increased the cost of delivering online interactions (paid and owned) to consumers across the web. As a consequence apart from inventory costs there are now fees for data, technology, measurement, ad serving and campaign personnel that must be accounted for. With the rise in costs comes the danger of misappropriation and suspicion by marketers that they are being skimmed.

The solution: Media agencies should be proactive in disclosing the composition of their service fees, and any business relationships or investments in sub-contractors that they recommend to clients. On the buy side marketing bodies like the AANA should collaborate with the supplier side to prescribe guidelines that are fair and take cognizance of how digital actually works. Nothing will be gained by pushing suppliers into a race to the bottom.

3. Skilled workforce and education:

“How do we up-skill everyone in digital”

The challenge: Digital is a relatively new channel so there aren’t many experienced practitioners. I cringe when I read inaccurate claims and comparisons made by online publishers because it only exposes the naivety of the industry. You cannot compare a video view to average viewing time on TV or claim incremental reach using two separate measurement panels.

The solution: We need digital specialists to understand marketing and traditional media so they broaden their viewpoints. At the same time C-Level marketers and anyone with a traditional media background has to up-skill quickly because all media is soon going to be traded digitally. I’d like to see more digital leaders impart their time to organisations like N-Gen/MFA5+ and deliver guest lectures at educational institutions. For more on this refer to my older post about how to combat the digital skills shortage.

4. Improvement in customer experience:

“How can I transform my business digitally”

The challenge: The focus is always on media and brand websites but digital is much more than these two touch points. Increasingly all our go-to channels are digital with the lines blurring. Consumers don’t think of brand touch points as digital or traditional. They just want to solve a problem, take an action, get information etc. Apart from websites, bad ad experiences are equally disruptive with consumers citing annoying/intrusive ads (64%) as the top reason for using an ad blocker software.

The solution: Brands need to consider their consumers worlds through a 360 degree lens, and make every interaction simple. The focus should always be on leading the consumer quickly through the purchase funnel. Think Uber, Netflix, Apple, Google all brands with great UX that consumers keep coming back to. Beware of being sold technology solutions that market themselves as the panacea to all your problems. Map out your ideal digital experience workflow first and then tender out the project to find the best vendor to deliver your vision. Advertising formats that disrupt the online experience must be discontinued and the IAB’s L.E.A.N ads guidelines adhered to.

5. Robust measurement:

“Are we only counting what we can measure instead of measuring what counts”

The challenge: Until recently metrics from Google, Facebook and some other major publishers were not audited by the MRC. This is now changing and more 3rd party vendors are being accredited for independent measurement validation. The problem is that we get too many metrics for digital but most are meaningless and only befuddle those who receive them. There are also multiple vendors each with different counting approaches. Imagine if television had 4 accredited rating companies who calculated a TV rating point differently.

The solution: Media agencies and advertisers have to band together and use their collective investment might to demand auditing and validation. We need consistent definition of units like video views. Let’s bring in some rigor by mapping the role of channels and metrics to relevant stages in the consumer journey rather than looking at them in isolation.

6. Marketing effectiveness:

“Is my online media driving marketing ROI”

The challenge: Online specialists focus on media and operational metrics like clicks, impressions, views which are important for efficiency but not as important as metrics that actually matter to marketers. A good marketer cares only about metrics such as brand favorability, sales, profit or future sales indicators like net promoter score. Also in Australia only 4.9% of retail sales are done online so connecting online metrics to offline sales is an important requirement.

The solution: There is no holy grail or silver bullet for the above challenge, but astute marketers can implement low cost tactics to estimate the online to offline effect. Simple solutions like using online coupons (Facebook Offers) that can be redeemed offline and location data (beacons) to track offline visits from online ads can also be used effectively. Our team recently used the Google Adwords Store Visits feature to measure the impact of paid click ads on automotive dealer visits. In addition there are other options; short-term (brand uplift studies) and long-term (multi-touch attribution and econometrics) that should be invested in to provide indicative guidance for future investments.

In summary there must be acknowledgement that digital has issues and needs to address them quickly. But the way forward is not to cower down or lash out but to implement solutions proactively. The impetus must also come collectively (and proactively) from the constituents of the industry. It’s time for digital to display some grown up behavior.


Four must-do things to retain digital talent

Digital team

The digital skills shortage in Australia has been well documented previously by numerous industry and research bodies. With digital revenue on course to surpass all other media in years to come, a grab for the limited talent pool has started. More recently advertising agencies and client teams have begun to expand their digital resources by poaching from full-service digital set ups or media planning agencies.

This puts pressure on organisations who have done all the hard work in identifying and training talent either locally or from overseas. Training new staff or going through the lengthy process of interviewing overseas candidates with sponsorship requirements can be cumbersome. To check the rate of attrition, organisations should focus on four simple retention strategies to keep existing in-house talent.

1. Have a Digital vision

Organisations with a clear vision of the role of digital in their business are more likely to hold and attract digital talent. Internal candidates will recognize that such organisations are more likely to invest in tools and resources that will aid their personal growth. Do not commoditize the digital product through an over-reliance on trading desks and exchanges. A strategy first organisation will always attract and retain the cream of the talent pool.

2. Build a team

Don’t just add one token digital specialist under a generalist manager. Instead build a high performance digital team. As new technologies and formats roll out, digital executives need like-minded peers to bounce ideas off and to share learnings with. Make your digital team members feel they are part of something bigger rather than just resources to keep your basic search, website and social functions ticking over.

3. Support. Support. Support.

Nothing inspires employees more than top management support. Hire the best and get out of their way as the adage goes. Chances are there is very little you can teach your digital people, but what you can do is ensure you clear any hurdles impeding them. Also allow them the latitude to choose their tools, devices and operating systems of choice.

4. Reward as required

Recognize that digital specialists are in demand and their salary expectations only reflect what the industry is offering. This is simply supply and demand. A few thousands to retain someone with valuable intellectual property (IP) and the right cultural fit is peanuts compared to the loss in productivity due to the inability to replace them.

Australian Digital Industry in Focus [Highlights of recent research]

In the last week there has been a flurry of reports on the digital marketing field in Australia. Which is good considering digital marketers like to vacillate about where digital is going and what’s tipped to be the ‘next big thing’ but very rarely stop to introspect upon ourselves as an industry and career path. I’d like to summarize some key points I picked up from the 2 press releases this past fortnight.

Digital IQ Survey – Digital Chameleon (350 respondents)

  • Only 28% of respondents possessed the necessary range of skills for their role.
  • 70% of people in digital media and marketing roles admitted to having no prior online experience
  • 72% of staff admitted to being uncomfortable with their current level of digital skills

2012 Digital Marketing Big Australia Report – Responsys (125 respondents)

  • 89% expect their budgets to increase or remain the same but only 41% are expecting to hire more staff
  • 37% spent more time on execution than strategy with only 20% doing the opposite, and 43% equal
  • 57% believe there is a digital marketing gap in their companies
  • 52% believe their marketing team is sufficiently equipped to deal with and analyse data

The above points just go to show that while Australian clients have accelerated their digital investments, the underlying skills shortage and knowledge gap is only putting more pressure on existing teams and leading to under utilization of data. In my next post I’ll address some of my own observations on what’s holding back a more complete digital transformation of agencies and clients.