Digital Media Trends and Challenges - an Interview with Sarah Fay
Posted on Tue, Aug 10, 2010
We interviewed board member and 20-year media veteran, Sarah Fay, on topics such as digital media trends and challenges and her involvement on several boards. Here's part one of two.
What trends are you seeing in the digital media space?
Consumer behavior continues to progress and change at an astounding rate in the way people are incorporating technology into their lives. This has had a significant affect on media usage and purchasing behavior. Already, 95% of active internet users are on broadband, 20-25% of mobile devices in the US are on smart phones, and more devices, like the iPad and the Kindle are starting to become entrenched in everyday life. Amazon and eBay have both passed $1 billion in annual m-commerce revenues – amazing. As fast as it all seems to be moving, we are STILL in early digital times. According to Emily Green, Author of the book, “Anywhere”, demand for network capacity will continue to rise exponentially through the next decade, creating trillions of dollars in value to the global economy. So marketers have before them an enormous opportunity to reach, influence and serve consumers who are becoming more tech savvy and more empowered to get and pay for what they want, when they want it.
Some resulting marketing trends that are addressing the ever-more empowered consumer include:
Retail Engagement Marketing – Ask anyone in the sales and marketing division of a manufacturing company about which direction their retail support budgets are moving and the answer tends to be “up”. The battle for purchase consideration has moved right to the aisles of the stores, as close to the final product selection as possible. After all, it would be a shame to spend $5 million on brand advertising, only to lose to a competitor who spent $500K on merchandising promotions. Today’s consumer is less brand loyal than ever before, and is using technology to point to the best deals and opportunities – even in the last steps before check out. There are a number of nascent mobile scanning technologies (such as Red Laser, PushPins, AisleBuyer, Scanbuy, MobeStream Media, and many more) all of which can engage the consumer by offering discounts and information when he/she is close to making a purchase – right in the physical store.
There are also smart phone applications like Should I Buy It? which lets shoppers ask friends what they think about a product they are considering – very popular among the teen set. The general trend here is to use digital interaction to engage the consumer in the retail space, and influence the buying decision by enhancing the shopping experience.
In the online space, manufacturers are also nestling as close as they can to where transactions are taking place. Behavioral targeting allows advertisers to know when a consumer is in market for the category of products they sell. In addition, advertisers are placing their product messages right inside eCommerce sites to get closer to consideration when consumers are in buying mode. Have you checked out Walmart.com recently? There is product advertising on just about every page, and other retailers are starting to create similar promotional environments for the products they carry. Searchandise Commerce fits right into this trend – in helping retailers to create a site search advertising opportunity so advertisers can reach consumers who are searching for products they are getting ready to purchase. It’s intuitive that reaching consumers who are in buying mode should create a boost to sales.
Getting Creative with Data – Data strategies and campaign automation are increasingly being used to drive program success. While the traditional approach has been to develop a media plan that addresses several buying segments (most often manually – involving spreadsheets and phone calls), data planning has become much more intensive. Media planners have typically begun with an assumed target audience that was painstakingly created with research and insights, but it is now not uncommon to cast a wide net with a data strategy that allows for many variables to be measured, and to let the data strategy dictate the direction of the targeting plan. Some advertisers are targeting a wide variety of niche audience segments with distinct messages targeted to each, and often hundreds of variables to measure and optimize against. For this kind of program, there needs to be a data strategy and an automated mechanism for measuring and optimizing.
If you think about how this has affected the daily activities of digital media planners, they still have all of the usual media suspects calling on them (Google, AOL, NBC, ESPN, etc.). And now they have a new host of vendors providing audience behavior targeting options: BlueKai, Exelate, Media 6 Degrees, Acerno, etc. – which offer new kinds of targeting options beyond where the ad units will appear – of which audience variables will drive results. In addition, a new kind of service has emerged to automate across all forms of targeting options: the Data Service Provider (DSP), which provides technology that allows digital media buyers to target and optimize like we’ve never seen before.
In the performance marketing space, this kind of campaign management has surfaced millions in budget margins, and is having a huge impact on the industry (in ways that are both positive and negative). Performance marketers are becoming ever more efficient in maximizing their budgets and knowing exactly which audience segments will perform. But the FTC is getting itchy about data collection and protecting consumers’ privacy. The industry is under significant pressure to self regulate on demonstrating best practices in data collection in order to avoid government regulation, which could hinder progress and innovation in campaign data usage. Keep your eye on this space as it continues to move and change!
Applications for Enhanced Social Sharing – You have to acknowledge that Facebook recently reached 500 million registered users, and the usage and time spent in social spaces is staggering. Several years ago, I worked with MySpace on a major piece of research (called Never Ending Friending) that proved what we know today to be true – social media activity is a dominant area of time spent with media. We also coined the term “The Momentum Effect” – which is what happens when brands are successful in getting consumers to endorse their messages to friends and publish them on their personal social pages. When done successfully, these programs can deliver exponential returns as compared to other forms of media. However, the industry still struggles with executing this kind of program, and the really great examples of incorporating social media into the fabric of brand communications are still the exception rather than the norm.
HOWEVER, as social media represents a huge behavioral shift across the general population, brand marketers and agencies alike are working to figure out their social media strategies – at the direction of their senior management, so the spotlight is shining onto this space.
I was present in a “town hall” discussion at the iMedia Brand Summit which included some of the biggest digital advertisers in the country, and the topic of debate was “Which person within an organization should own the social media strategy?” Answers ranged from “the Web Master” to “the CEO”! Not only was there very little agreement on where social media should sit within a company, there was nothing close to an agreed definition of what a social media strategy looks like! So the market is in a very early phase of development.
Marketers are after a new Holy Grail: The Momentum Effect (some people call it “earned media” where the brand provides something that is entertaining or interesting enough to be shared, therefore “earning” the consumer’s advocacy). If you get the combination just right, the consumer will do the work for you, and boom! you get a whole lot more media than you paid for. But it’s tricky. It would be a shame to spend a lot of time and money developing an idea that fails to inspire the consumer to take part in your messaging strategy (which I suspect has happened a lot). Don’t get me wrong – the great examples that show real results from leveraging the consumer’s voice are out there. But marketers need to find repeatable ways to get these results versus taking a flyer on a customized game or web experience every time they want to create a social experience.
A number of companies have developed applications that deliver enhanced audience engagement and social sharing every time, and marketers can buy in using good old media currency (CPM or even CPE – Cost-Per-Engagement) instead of making a big up-front creative investment. As an example, a company I work with called trueAnthem, has created a patented platform for brands to distribute free music to consumers. Consumers post this music player to their social spaces, and brands get carried into consumer streams of communication. It works every time, and if music fits with a brand’s strategy, it is a guaranteed and repeatable method of attaining engagement and social sharing of a brand’s message. Other companies are creating similar platforms, are SpringPad, which works well in the recipe sharing space, and SocialVibe which helps brands into the cause marketing space. Expect to see more applications as a new part of the media diet.
What are the biggest challenges in the market?
Integration: Because many digital marketing skills, such as creative, media planning, mobile, and SEM have become so specialized, it is difficult for some agencies and client organizations to respond to opportunities that combine these kinds of executions. A media planner may love an idea that incorporates a specific kind of creative, but may not have the time, inclination or power to bring that idea to life. Many new solutions (such as brand owned applications) need to fit into an overarching strategy to be effective, and even then, old marketing habits need to be broken in order to utilize some of the new marketing tools available today.
As an example, the best social media strategies are extended to live within all forms of media, including TV, print and OOH. How does a conceived social experience make it into the hands of the creative strategist planning these campaign elements? And who will be in charge of the ongoing conversation that the campaign begins? Once you begin a two-way conversation with customers, it’s not typically a good idea to break it off. But you would be amazed at how often this happens.
As ever, the marketing world needs to be more nimble, strategic and integrated – which requires idea champions to work beyond their areas of responsibilities. Are there great examples of integrated strategies? Absolutely. Are there enough of them? Debatable.
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Sarah Fay is a 20-year veteran of the media services business, having started her career in traditional media sales. She became a Principal of the high tech media agency, Freeman Associates in 1993, which was acquired by Carat in 1998. Sarah went on to become Managing Director of Carat Business and Technology, and later launched Carat Interactive in 2001, building the agency into one of the top full service digital marketing agencies by 2003. Sarah later served as President of Isobar U.S., creating a formidable network of award-winning agencies. In 2007, she was named CEO of both Carat and Isobar U.S. In 2008, she was named CEO of Aegis Media North America, where she oversaw the operations of all the Aegis Media operating units in the US and Canada until recently.