5 Digital Truisms for Marketers

Many marketers would be only too happy to forget 2009. Even though digital spending was not exempt from the suffering, testing and new approaches yielded big payoffs, which may be as hard to sustain in 2010 as our already-defunct New Year’s resolutions. As we dive into 2010, there are some key opportunities and risks in the digital landscape that will change the way we do business this year.

Video Inventory Will Grow, as Will Demand
Today, consumption of online video is at an all-time high — more than 70 percent of adults 18-34 have watched an online video. A recent survey by TurnHere, an Internet video marketing firm, found that more than 90 percent were highly likely to use online video in their 2010 media plans. There’s no doubt that consumer adoption, advertiser demand and the premium pricing that video commands will drive a greater inventory commitment by online publishers.

Looking back at the 2009 online video marketplace, I am most impressed with the amazing efficiencies. Can these kinds of numbers sustain themselves this year? How will increases in both supply and demand affect pricing? My bet is that, despite the large percentage of marketers who expressed intent to use online video, supply will outweigh demand, allowing us to deliver ’09 pricing efficiencies in 2010.

Auditing Will Help Protect Investments
In addition to Atlas and Double Click (DART), which audit online impressions, there are new companies that verify whether an ad also ran and appeared within the visible screen. These companies, like Double-Verify, also ensure that ads ran according to buy specifications. Working with DoubleVerify last year, we were able to identify an ad network that was delivering nearly 40 percent of a client’s impressions outside the U.S. when they were actually targeting consumers in the U.S. With online auditing, digital marketers can now quickly identify and correct these kinds of previously untracked problems. Expect this level of auditing from publishers to provide proof that ads are running as intended in 2010.

The Impact of Government Intervention
Last year, behavioral targeting and retargeting (targeting people based on their online actions) have had a significant, positive impact on the ROI of digital campaigns. In the response media world, we’ve found that cost per action was between 43 percent and 76 percent more efficient than with typical demographic targeting. It translates to better targeting for marketers and more relevant advertising for consumers. But there continues to be a lot of gray that needs to be resolved with transparency.

Consumers, Congress, the Federal Trade Commission and other government agencies are all justifiably concerned that personally identifiable information may be used in a harmful way by marketers. A number of industry groups (AAAA, ANA, DMA, IAB) are being proactive about building consumer transparency measures so that behavioral/re-targeting is done legally and with transparency to avoid legislative hassles.

Still, greater transparency is likely to challenge behavioral targeting, even if the industry is successful in avoiding government intervention, because it will reduce the universe of customers that can be reached. However, transparency could result in a universe of customers who are more receptive to advertising.

As digital marketers, we will need to manage these higher CPMs that may be associated with these smaller universes as we also reap the higher response that should come from a more qualified base.

Changes in Paid Search
Even with the launch of Microsoft’s Bing, both Microsoft and Yahoo combined are losing market share to Google. Yet, 2009 testing indicates Bing could be a formidable competitor. Bing’s click-through rate has been up to three times higher than Google’s for ID Media clients using both search engines. Search engines that provide the best consumer experience and that are continuously advancing this experience through new product features, tweaks and improvements of their engines will dominate in 2010. With these improvements, new advertising opportunities within paid search will emerge.