The answers where many, generic and basic. It was about penetration and demographics. Digital spent in the West vs. MENA and many other digital media insight crumbs.

Nowadays, the game has changed. Advertisers became more sophisticated and knowledgeable. How Online? is the new currency. Leads, Acquisitions, engaged, likes, fans, tweets and retweets are some of the new KPI’s.

Still stuck with click rates (CTR), time to move on don’t you think?

How?

Digital Media is unlike any other medium and should not be viewed using traditional benchmarks. The effective commission rates or reach and frequency targets used to measure traditional mediums have no correlation to Digital. The inputs and outputs are not comparable. The high-volume, low-dollar, high-complexity nature of digital programs makes it the most labor intensive medium in the advertising industry.

These are four primary drivers that contribute to the (seemingly) higher costs of Digital advertising and media agency services when compared to traditional marketing/media services:

1. Growth in labor intensity
2. Shift from external third-party production resources to in-house agency resources
3. Blurring of lines between media, production and agency services
4. Establishment of new job functions and organizational structures within agencies

The following points sums a digital media agency scope of work and will give you a more in-depth knowledge of what I have encountered in practice and read/learned in theory.

online/offline Switch

A. Media

• Volume, Project Duration, and Complexity: The vast number of Digital options makes the entire process more time-consuming from strategic planning to creative development, and from media planning to buying and stewardship through reconciliation.
• Dollar Value of Placements: Individual Digital placements tend to be in the thousands of dollars versus the hundreds of thousands in radio, print, OOH and TV. This goes beyond sacrificing the traditional buying leverage to achieve network or volume discounts. The resource impact comes from handling the small dollar value of individual online placements against exponentially higher volume.
• Optimization: Offline media is lighter on stewardship and optimization. An agency will generally monitor traditional unit positioning and make sure placements are delivered as ordered. In online media, one would expect the same monitoring of frequency, positioning and delivery, but would also expect to look at performance on a number of different levels (campaign, message, click-through rate, conversion, etc.), then re-plan based on that performance. The immediacy of the Digital experience and the ability to analyze individual unit performance generally result in more units being created, “refreshed” or tracked.
• Innovation: The Digital space is ripe for “never done before” approaches. Rules and restrictions tend not to apply. This can fuel higher expectations for innovation. Obviously, cutting-edge programs are more difficult to manage, negotiate and execute. They also tend to be more likely to have technical problems, which are time consuming to resolve. Creative and Media “firsts” (i.e., User Engagement, UGC, blogs, etc…) tend to start as small-scale initiatives as advertisers play in the “test-measure-then-invest” space. However, they also require much more work from all parties concerned (agencies, media owners, and advertisers) than a larger traditional buy.
• Expanding Complexity of “Search”: Search has evolved as a completely new and separate media discipline. It continues to expand beyond Paid Search Platforms (search engines and directories, shopping engines and ratings, etc.) and Search Engine Optimization (SEO) (technical, content and link generation) into other platforms including enterprise search, desktop navigation, mobile, local, audio search and more.
• Fragmentation of Media Ownership: A typical large agency can deal with a few hundred vendors across Print (consumer and trades), TV (network, cable and local broadcast), Out-of-home and Cinema in a given year. This is comparable to literally thousands of Digital media vendor options. Multiple properties owned by a larger parent company still tend to operate as autonomous entities. Although the mix will vary with individual campaigns, Digital placements and variety tend to far outnumber traditional vendors in a balanced media plan. The landscape continues to evolve. The ability to deal with so many niche market players may deliver the promise of the Web (personalized communication), but it comes at a cost.
• Reconciliation Process: The stewardship and reconciliation of advertiser funds is a critical part of an agency’s media service. For an individual advertiser, this process has expanded exponentially. In the example above, the difference in bill/pay activities between stewarding, tracking and reconciling one prime-time TV spot for $20,000 versus 10 Digital placements (with same total value) is significant.
• Inadequacy of Industry Standard Systems: The lack of standardized systems among advertisers, agencies, and the growing number of Digital media vendors has created a number of manual processes to populate disparate systems with consistent data. The industry also faces an ever-growing array of (currently disconnected) new technology platforms and distribution options. This goes beyond the strategic media execution to impact the efficiency of the entire bill/pay and reconciliation process, and is further complicated by the volume of individual placements.

B. Strategic Planning/Analytics

• The World Is More Complex: This requires an increased level of strategic expertise to navigate the array of rapidly expanding channels and deliver an integrated marketing plan. Although tools and technology help in providing insights, there are no shortcuts in the evaluation of marketing options, channel plans, and related investments. Strategic and financial “Annual Plans” should represent the foundation for a “continuous planning” process. The continuous planning process requires the flexibility for advertisers and their agencies to embrace and accommodate the possibility of rapid response marketing.
• Integration Takes Time: The time required to plan and integrate across a wider range of channels is another driver of cost. Digital and non- Digital channels are generally expected to be integrated both ATL and BTL and across many markets. This includes connections to PR and POS and across a wider range of techniques, including branded content and P2P (and currencies for that matter). The situation is further complicated when working with a diverse advertiser who may itself not be integrated. Practitioners should not underestimate the time required to coordinate disparate ATL and BTL approaches and budgets.
• Analytics: The Digital space allows for more frequent and deeper analysis of campaign results at a granular level. It also provides the driver for an increasingly popular “test-measure-then-invest” model. The expectations for measurement of online media far exceed those for offline. This effort is not limited to analytic specialists, but also requires significant media resources to develop and implement tracking solutions. This often includes the coordination to track basic response metrics through third party ad servers (e.g., Atlas, DoubleClick, etc…), as well as the advertiser coordination on more robust back-end tracking and measurement of awareness and perception-based metrics. By definition, “test-measure then- invest” also has certain labor redundancies built in.

To make it short and jump straight to the main subject, my blog will be discussing topics about the region Digital Media and Marketing Industry.

Stay tuned…

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