Even in September, some of us are still trying to nail down our 2014 New Year’s resolutions. The same can’t be said for advertisers —many of whom are already mapping their digital strategies for 2015.
Their main focus? Full speed ahead on digital.
Digital strategies may help drive the U.S. advertising market to $172 billion in 2015, according to new research from Magna Global. One in three ad dollars will go to digital advertising next year, meaning digital media spending will be almost equal to television spending.
“Many of our advertisers have now hired a digital manager or a team in order to keep up with the quickly changing media landscape. For those who have not, now is the time,” David Morgan, VP of Sales and Talent Development at Triad Retail Media explains, “Many traditional agencies have now developed entire digital divisions when a few years ago digital might have been an afterthought.”
Spending on TV advertising may be safe now, but Magna Global predicts it will take the biggest beating over the next few years as digital strategies gain more traction. It projects digital advertising will top television advertising by 2017. This is due in part to the growing popularity of online video, with sites like YouTube, Hulu and full episode players (FEP) from broadcast networks like ABC and CBS. So, television: You have two years.
Increased traffic from mobile devices and social sites has also helped push digital to the forefront — social represents 32% of the digital market share and mobile 51%.
While it’s important to assess strategies year-round, the promise of a new year can help put things in a new perspective. Take this chance to review the state of the industry to better prepare for where it’s headed. Come January 1, 2015, expect to see digital alignment at the top of advertisers’ resolutions lists—right above joining a gym and cutting back on sweets.
The average American carries at least two, sometimes three, mobile devices with them. It sounds like a lot, until you break it down—there’s the omnipresent smartphone, a tablet or maybe an e-reader, an MP3 player … it’s pretty easy to get to three.
So many devices. So little time. Photo courtesy Blake Patterson.
Tom Boisvert, Triad’s VP of Product Innovation, wrote on Retail Online Integration about how critical it is to optimize advertising programs for mobile. He explained different tactics to optimize a retailer’s mobile presence, but we wanted to give you six more reasons to start optimizing for a mobile strategy:
- More digital content is being consumed on mobile devices. U.S. adults will spend 23% of their time consuming media on a mobile device this year
- Tablets are increasingly used for online shopping. Tablets are projected to bring in $76 billion in online sales, twice that of mobile devices
- Mobile ad spending has exploded—and is expected to hit $31.45 billion this year. By 2018, mobile ad spending is projected to top $94 billionMobile devices lead to in-store purchases. 52% of U.S. shoppers have used a mobile device to research products while browsing in a store
- Age makes no difference: 69% of older Baby Boomers and 97% of Gen Yers use their smartphone to shop while in stores
- Mobile advertising on social channels is critical too. For the first time, social mobile advertising revenues surpassed social desktop ad revenues
As Tom said, “[Shopping] can begin in-store and end on a smartphone, or vice-versa. If any of these entry points is lacking in any way—e.g., the path to purchase isn’t clear and direct—consumers will get lost.” Whether at home or at their local retailer, consumers are using their multiple devices to complete the path to purchase.
While this presents an opportunity to win customers, this also means retailers have to work twice as hard to make sure they don’t get lost. To ensure that, you need to implement cross-device mobile strategies that will keep the potential customers on the path to purchase with you.
“U.S. retail e-commerce will continue its torrid growth in 2014.” If your livelihood depends on e-commerce, you’ve got to love any report that begins that way. eMarketer’s U.S. Retail Ecommerce: 2014 Trends and Forecast highlights both overall growth and the increasing interplay between online and offline retail.
Some key findings:
- U.S. retail e-commerce will continue to grow in 2014, with sales predicted to hit $304 billion (up 15.5%)
- 90% (nearly 197 million) of U.S. Internet users over the age of 14 will shop online this year
- 163 million of these shoppers will complete a purchase digitally this year
There seems to be a discrepancy between the last two points, but they show how buyers are integrating digital channels into their shopping process. Even if the consumer does not complete the transaction online, the impact of digital interactions on the shopping process has become increasingly important.
As e-commerce grew, retailers were initially afraid of the “showrooming” phenomenon, where shoppers would browse in a store but buy online. But an Accenture study found 72% on U.S. shoppers had showroomed, while 78% had webroomed, or browsed online before buying at a store.
Consumers today are going digital at some point on their purchase journey, whether they’re researching or in the store looking at a product. This trend makes it crucial for retailers to examine how they integrate their digital properties into the shopping experience and direct consumers to products while browsing online and in-store.
The real issue isn’t how a shopper buys, but how they buy with a certain retailer.
Mother’s Day gift ideas—from sparkling jewelry sets to luxurious spa day packages—are already popping up all over the Internet. For retailers, Mother’s Day is a lot more than flowers, cards and candy. It’s the third-largest retail holiday behind Christmas and Back to School.
If you’re still planning your Mother’s Day advertising copy, remember this: Emotion matters. Mom is often the first person with whom we create a deep, emotional bond. She feeds you, clothes you, cares for you and she also lays down the law when you’re out of line. It’s a complex relationship that may change over time but rarely loses its resonance with consumers.
Give a gentle tug on your customers’ heartstrings by reminding them how special Mom is and why the product you offer is the best gift to reflect the special bond they share. It’s not about the size of the gift; it’s about the sentiment the gift represents.
Mother’s Day is Digital Too
Nearly 3 in 10 Americans will buy Mother’s Day gifts online. Why the surge in online shopping? One factor might be Millennials, who are perfectly comfortable researching and purchasing products online. And their purchasing power is impressive. Millennial purchasing power is an estimated $170 billion annually. In 2011, Millennials between 25 and 34 spent approximately $191.35 on Mother’s Day, and the younger Millennials (18 to 24) came in a close second at $183.38. This may be a bit of double-duty gift-buying. Many Millennials are themselves, new parents—80% of U.S. births are now to Millennial parents.
Millennials are equally comfortable to purchase items online or in-store, but their first inclination when researching products is to grab their laptop, tablet or smartphone. Earn their attention with helpful buying guides, creative Mother’s Day gift ideas, and emotional, uplifting stories. They also love a good deal, especially if it’s promoted on their favorite social media. In an eMarketer study, more than half of the women and 44% of the men surveyed said they used Facebook or Twitter to receive notifications for sales and specials.
Forget About the Flowers
Flowers are a big seller on Mother’s Day. About $1.9 million goes toward bouquets and other floral gifts for moms. But they are hardly the biggest Mother’s Day gift category. Jewelry and electronics top the gift charts, with average spending at $4.2 and $2.3 billion, respectively.
Make your shopper marketing dollars count with media placed where shoppers are likely to be browsing for Mother’s Day gifts on major retail and auction sites, as well as social media.
There are an estimated 2 billion moms in the world, but she’s always one in a million to the people who love her. With the right digital marketing strategy, your product can be the one gift that makes her day.
We’d like to take a quick moment to congratulate our Chief Revenue Officer, Brian Quinn, for earning the prestigious ad:tech Industry Achievement Award, which honors those who provide outstanding service, create breakthrough ideas and foster industry growth.
Brian has been a contributor to the industry for nearly 20 years. He founded the influential 212, New York’s leading organization for the digital advertising industry, which now has more than 5,000 digital media, marketing and advertising professionals in its membership. Brian currently serves as co-chairman on the IAB’s Sales Executive Council, which is dedicated to furthering the interests of ad-supported interactive properties.
At Triad, Brian oversees all sales and marketing activities for the company’s digital retail site partners, including Walmart, Sam’s Club, eBay, Sears, Asda, CVS, Toys“R”Us and Dollar General.
From all of us at Triad Retail Media, our heartiest congratulations to Brian!
As a consumer, you are accustomed to video content across your usual online content destinations. On news, entertainment and sports sites, you know and expect at least some video content. Video content keeps users engaged, holds them on the site and, most importantly, keeps them coming back. Of course, a component of the video ecosystem you are also accustomed to is video advertising in the form of pre-roll or sponsored content.
So, if consumers have a certain level of expectation for video content on their favorite websites and they are used to video advertising as an “entry ticket” to be able to watch that video content, then why has video content and video advertising opportunities failed to gain significant traction outside of pure content destination sites?
Retailers are missing an opportunity to achieve their primary objective of selling more products. Unlike Amazon, retailers don’t have to invest in video creation resources on their product pages to be successful. A simple invitation to suppliers (whether monetized with advertising or not) to submit helpful video content to assist with the sale will help jump start video content on their site.
Currently, video advertising demand outweighs supply across quality sites. This offers opportunities for publishers to sell their inventory directly at high CPMs or put their inventory into an exchange where advertisers can bid programmatically and fight over the existing inventory. Publishers who have figured out how to utilize video content not only as a way to enhance the site experience, but also as a way to substantially impact advertising revenue are cashing in.
The big question for retailers is, why continue to sabotage the customer experience, site sales, and monetization opportunities while Amazon is mastering video and reaping the rewards?
Retailers Are Also Publishers
Most video content associated with advertising opportunities have been limited to content publishers as opposed to traditional retailers and other ecommerce players. Why? Video content enhances the site experience. While the purpose of the video content is different for retailers (focused on informing purchase decisions) as opposed to pure information and entertainment, retailers are clearly missing the boat in terms of capitalizing on the multiple streams of revenue video can generate.
Many retailers hesitate because they don’t want video to clutter up and interfere with the buying process. While their first objective always should be site sales or a clean experience that leads to an in-store sale, retailers miss a major opportunity to hit both of those objectives. This is where retailers need to start seeing themselves as both publisher and in-store sales assistant.
Now That’s an Opportunity!
Say, I need to buy a washing machine and dryer within the next 12 months. I have a price range in mind but, other than that, I am completely clueless about which make and model I should purchase. I visit a series of retailer websites to research, but spend my time clicking through product pages just reading product specs. In the end, I’m left without knowing what factors I should consider when selecting my washer and dryer and I’m no better off than when I entered the product consideration cycle.
Imagine how helpful it would be if the retailer presented me with a short video to help me understand what to consider when making my purchase. Sounds simple, but most retailers do not take this step. For the few retailers that offer this video resource—ABT for example—they are missing an opportunity to monetize the video with short pre-roll content or sponsorships. Retailers and brands have an opportunity to reach me as a shopper and have a large brand impact, during a valuable time – when I am in the purchase consideration mode.
Another opportunity can be found in the next place a consumer is most likely to turn if they can’t find what they’re looking for: Search. If a consumer is already exhibiting purchase intent and site search produces video results (such as a branded product video), there is no greater efficiency for a brand message to affect a sale.
Follow the Money Like a Publisher
Video advertising revenue is no joke. Take AOL. They haven’t exactly been a model of success in the past several years, but they posted their biggest revenue growth in the past 10 years this last Q4. Their purchase of Adap.tv and the subsequent revenue results show that the purchase and sale of online video through real-time bidding pays off.
For the retailers worried about demand, stop. Demand for quality video advertising opportunities has never been higher. The ability to purchase video programmatically (like AOL has with Adap.tv) allows advertisers to leverage publisher first-party data in order to get in front of their targets when they are likely to be in-market for a specific product or category of products… a true goldmine for an advertiser and a major revenue opportunity for the retailer.
AOL isn’t the only publisher to cash in on video advertising. Amazon just announced a partnership with technology partner FreeWheel that could be the first step toward creating their own video ad network. With Amazon’s huge product listings and their current use of product page video, it is somewhat surprising that it has taken them this long.
The real question for more traditional brick-and-mortar retailers is: How long will you wait to follow the money and begin thinking like a publisher?