More and more, Aztek is working with clients that shift some or all of their traditional marketing and advertising budgets to digital marketing. Obviously, the massive technology shift from traditional media to digital media is behind much of this swing, but we'd like to dive a little deeper into what the transition looks like.
At some point, often once a year, organizations evaluate their marketing budget. This means taking a look at the thousands of dollars that are going out and trying to understand what’s coming back in return. Over the last decade, many organizations have realized that they don’t have a concrete answer for this question, and it has led them to re-evaluate their marketing spend.
Before we go on, let’s set the record straight. There is definitely still a place for traditional media in all forms. But organizations must evaluate if it is the right fit for them. Here are a few things to consider during this evaluation process.
For most organizations, this is the driving factor. An annual or semi-annual assessment of traditional marketing spend typically reveals large amounts of money being doled out for print advertisements, radio advertisements, direct mail campaigns, and more.
Now let’s pretend a company is running a quarterly print ad in a prominent regional publication, sending out a direct mail campaign two to three times a year, and running radio ads. Their traditional media budget could easily fall into the $50,000-$100,000 range. This organization’s leadership, at some point in time, needs to justify these costs.
On the other hand, let’s look at some of the cost benefits of digital marketing:
- Pay-per-click advertising models allow advertisers to set a very specific budget within a very specific timeframe
- Online advertising costs less to reach people—this infographic suggests that a print ad costs about $20 to reach 1,000 people, while Google Adwords might only cost around $3 (even less for social media advertising)
Here we go with that question again: “What are we getting out of this investment?” With traditional media, it can be challenging to track ROI, conversions, and results. Sure, there are some effective methods, including:
- Driving traffic to landing pages (But please don't use a QR Code! Yuck.)
- Tracking changes in sales/lead generation (hard to attribute precisely)
- Tracking coupon redemptions
At the end of the day, having a really good concept of the value of traditional marketing is tough, and adds a lot of work in terms of tracking in the first place.
Digital marketing, on the other hand is—you guessed it—easier to track:
- With digital marketing, sales and/or lead generation can be tracked down to specific channels (pay-per-click, email, search), specific campaigns, locations, new vs. returning visitor, etc.
- Dollar amounts can be assigned to sales/lead generation from everything above to evaluate the true ROI of each digital marketing investment an organization makes
- Organizations can make better decisions in the future because they know what’s working now and in the past
Most organizations (hopefully) know their audience well. They understand what they read and what they listen to. Using this information, organizations can handpick magazines, journals, radio stations, and more for advertising opportunities. Here’s the problem with this model: advertisers pay for the entire audience.
If a magazine has a circulation of 30,000 people, advertisers pay for all 30,000, regardless of their demographics, buying habits, intent, job title, etc. Media kits are a great way to get a good idea of the makeup of a magazine or radio stations audience, but you can’t pick and choose just certain people from that circulation or listenership.
This is what some may affectionately call “spray and pray.” Pay for everyone, pray that some people are interested.
Let's look at benefits of targeting with digital marketing:
- Advertisers pay for the very specific audience they want to reach. With most social networks, this means drilling down geography, job title, interests, and more. With search advertising, it means targeting the very specific keywords that lead a user to your product or service.
- In-depth analytics provide advertisers with a view of which audience members are leading to conversions, and which are not. This allows advertisers to make well-informed decisions in the future.
Is It Time To Switch?
If you’re a traditional advertiser or marketer, some of the ideas in this article may resonate with you. It might not be time to abandon traditional marketing all together, but starting to shift some of that budget toward digital marketing may give you a better, more trackable ROI along with better data to make future advertising decisions.
Whenever you’re ready to have a discussion about shifting some of your budget to digital marketing, we’re here for you.