Early holiday indicators demonstrate that marketing to the hyper-connected consumer is necessary. The bar is set high to deliver a compelling, contextual and consistent brand experience across all communication channels. Why is omni-channel marketing so critical this holiday season?
Compared to last year, 6 in 10 consumers report that they will shop only online this holiday season, two-thirds of consumers will shop both online and offline and only 34% will shop mostly in-stores reports Yahoo’s Holiday and Search Insights 2016 report. In all, 37% of consumers said they will shop more online this year than a year ago.
Key findings include:
Holiday shopping is an omni-channel experience
79% of consumers plan to purchase holiday gifts both in store and online
Shoppers are relying more and more on mobile as a “go-to” resource during the busy shopping season
On Black Friday, share of searches on mobile devices increased from 26% year-over-year
While Black Friday and Cyber Monday are the busiest shopping days of the year, many will not shop on these designated shopping days
29% of holiday shoppers plan to stay away from shopping during Thanksgiving Week
As brands look to create multichannel promotions, it’s important to maintain their brand authenticity. Brands should stay true to the consumer experience across the multiple marketing channels as a key differentiate in the holiday fury.
Marketing has become a data-driven function and its success hinges on whether marketing managers can reliably measure the effectiveness of their marketing initiatives. The key to achieving this lies in our ability to collate and analyze diverse datasets so we can make informed decisions based on quantifiable information.
Success, among today’s marketing pros, means improving the bottom line and deepening customer relationships, while keeping teams in tune with an evolving marketplace.
A recent study by Ascend2 surveyed some 50,000 marketing professionals in an attempt to address the hot topic of marketing data management, revealing how marketers currently compile and reference their various data sets.
Most important data management goals
The three most important goals of marketing data management are:
improving ROI measurability
improving data quality
increase data use/accessibility
Data addresses many of the challenges facing marketers.
Crafting and adapting a marketing strategy to changing circumstances can be difficult with a lack of data. Predicting and preparing effectively for negative trends becomes much harder with poor insights. Even reporting to senior management or investors without sufficient data can create additional obstacles to gaining support for further campaigns.
This is where data can provide a lot of support. Ascend2’s research has found that 54% of professionals believe that data helps marketers arrive at “more accurate decisions.” Marketing data management can help managers guide their activities through real life decisions and marketing scenarios.
“I speak with marketers all the time who tell me the same thing – if you’re really going to be agile with your messaging and distribution strategies, then you need the ability to see what’s happening, across all channels, at a glance,” said Ben Carpel, CEO of Cyfe, a solution for creating performance monitoring dashboards.
Managing successful strategy Managing strategy is directly connected to data management. More efficient use of data enables marketing managers to access it and make informed decisions based on it, quickly and easily.
Roughly 60% of the Ascend2 respondents reported that their use of data makes substantial contributions to the success of their overall marketing activities. In contrast, only 40% of companies and professionals rated their work “somewhat unsuccessful” or “very unsuccessful.”
“With data coming from so many different places, it can be difficult for a company to develop a consolidated view and an integrated approach to cross-channel marketing,” wrote Kerry Reilly, Adobe Campaign’s director of product marketing, in a recent op-ed. “It requires too much data maneuvering, the data’s not always in sync, and there’s lots of room for error.”
Outsourcing data management Producing and managing this data can be a complex task, requiring highly skilled and analytical talent. Many companies don’t have this niche expertise inside of their organizations, leading to heavy reliance on SaaS, outsourcing to service providers or embarking on long-winded hiring processes.
Results from the Ascend2 study indicate that a lot of data management is provided by third-party organizations, while 64% of companies outsource all or part of their marketing data management. Only 36% of businesses manage their own marketing data in-house.
The modern marketing function is in a state of flux, and emerging data solutions put pressure on marketing leaders to constantly adapt to changing requirements. Despite this uncertainty, it is crucial that business units have a clear understanding of where the responsibility for data lies.
This is a fundamental imperative in day-to-day management activities, as 54% of businesses allocate data management and analysis to their marketing departments, whereas the other 42% share it between departments or even only with IT department.
Effective data and resources Nearly all companies in the same study (97%) agreed that the effective use of marketing data is increasing. Marketing data management is a trending topic, and it’s constantly evolving.
In some cases, marketing data is being used to maximize profitability. Earlier this year, McKinsey demonstrated how tweaking prices by 1%, as informed by smart data modeling of marketing trends, has the power to boost operating profits by 8.7%.
There are many advances in the world of resources and tools within the data management space, allowing marketers to get closer to the data and deeper into its quality. Access to real-time and predictive data is currently a trending demand.
“Real-time data is critically important. Otherwise, business leaders may be making decisions off data that is no longer relevant,” notes Suzanne Mumford, head of marketing for the Google Analytics 360 Suite. “The business landscape changes so quickly, and stale data may inadvertently lead to the wrong decision.”
Data-driven marketing wins Data-driven strategies are becoming more popular in the world of marketing, yielding campaigns that are more calculated and therefore primed to deliver effective, measurable results.
Relying on data for marketing decisions makes for superior visibility, more strategic planning and a better-equipped team, which is transforming the strategic marketers’ approach.
Joe Liebkind is a Berlin-based writer. He has worked with startups in sales and marketing roles in Berlin and New York. Find him on Twitter.
Each year the mobile ad industry introduces new creative formats. These formats, both new and old, play an important role in the user’s experience and impact advertising effectiveness. To understand each ad format effect, Kargo, a mobile advertising platform, partnered with MediaScience, a neuroscience research firm, to analyze consumers’ responses to four mobile ad formats through their eye movements, biometric responses and attitudinal changes.
The research found that bigger ad formats are not always better on mobile and In-Stream and Sidekick ad units offer both strong consumer appeal and higher ad effectiveness. Interestingly, while Interstitial ads appear to offer higher brand recognition than Adhesions and Sidekicks, they also over-indexed as disruptive, annoying and intrusive.
Key findings from the study also include:
Adhesion units (adheres to the bottom of the screen and stays with users as they scroll down the page) are viewed as the most common mobile ad unit, and are easily avoided by users. While Adhesions are perceived as less intrusive than Interstitials, they received much less visual attention than all other tested ad formats.
In-Stream units (appears within the stream of editorial content) provide users with the opportunity to focus on mobile ads at their own discretion. In-Stream units perform similarly to Interstitials in visual attention, but outperform them in visual retention. In-Stream units are not thought of as disruptive, annoying, or intrusive.
Interstitial ads (served between content pages) appear to have received the most negative biometric response and negative ad evaluations. They are viewed as disruptive, annoying, intrusive and not well-placed.
Kargo’s Sidekick unit (a silhouette appended to the side of the screen, provides continued visual attention) performed like the other ad formats in visual attention without annoying the user. The Sidekick ad unit, like In-Stream, ranked best among users in terms of overall liking of the ads.
Overall, results of this study suggest that In-Stream and Sidekick units may be the most effective for mobile advertising, among the four ad formats. Both ads hold visual attention and are memorable without the intrusiveness of Interstitials. It’s important to connect both the rational and emotional appeal so the ad attains positive attention and offers users the freedom of managing their environment.
More than 50 years later, the wisdom of Herbert Marshall McLuhan, the Canadian professor and philosopher who famously observed in 1964 that “the medium is the message,” continues to strike a chord, underlining the inextricable link between the mechanics of how companies deliver their message and the influence these messages have on customer behavior and brand perception.
It’s all about engaging in a way that adds value to the “conversation” — and the rules of engagement that held true for the delivery of more traditional content and communications go double for mobile. It’s a medium where evidence is mounting that advertising and marketing approaches that merely retrofit online display advertising to smaller screens are patently out of sync with the requirements of consumers in the “mobile moment.”
Consider the findings of a recent report published by PageFair, which documented the meteoric rise in the use of adblocking technology on mobile devices. Studies like this document a clear disconnect between what content companies want to deliver and what consumers are willing to accept. However, most studies, including the PageFair research, draw from empirical data, not user surveys, to explain people’s growing fatigue with mobile advertising. Until now precious few have dared to delve into the real and root cause of brand affinity, or frustration.
This is where a new report by neuromarketing companies True Impact and Neurons Inc., and commissioned by MediaBrix, an in-app mobile video advertising platform for brands, breaks new ground, documenting the “how” and “why” behind consumers’ negative response to interstitial ads.
The Brand Receptivity Neuro Lab Study, which was designed to help marketers understand how consumers react to and engage with different ad formats, relies on technology to monitor people’s neuro and biometric responses before, during and after the delivery of a mobile ad. Respondents were wired up to neurometric and physical eye-tracking devices, and each consumer was asked to complete a post-exposure interview and survey.
The aim was to explore how different methods of delivering the same ad inside a mobile app (also known as an in-app ad) impact respondents’ receptivity to advertising. To test this hypothesis researchers measured the emotional and physiological impact (heartbeat, attention and the feeling of “wanting” that drives urges and decision marking) messages from two brands, MillerCoors’ Smith and Forge Hard Cider and a popular CPG brand, had on respondents during their sessions on a gaming app.
Among the findings:
Viewers were twice as likely to have a negative emotional response to a full-page interstitial ad than to an embedded, opt-in ad format. Pupil dilation, heart rate and other biometric data revealed that full page video interstitial ads aroused the brain’s “fight-or-flight” center, which explains why interstitial ad viewers also focused 22% of the time they did spend looking at the ad searching for the “X” button to close down the ad altogether. In contrast, respondents “actually watch the embedded, opt-in units,” with close to 90% of viewers watching the full 30-second video, compared to only 25% of viewers watching an interstitial ad.
Embedded, opt-in ad viewers don’t just watch the ad; they also spend three times as much time fixated on the brand creative and they’re 8 times “more cognitively engaged” with ad message.
Overall, embedded, opt-in ad viewers spend 9.5 times more time “understanding/considering the embedded value exchange offered by the ad” than they do considering the interstitial ad unit. This deep engagement with embedded, opt-in ad units resulted in 70% of those viewers remembering the product and 73% understanding the brand offer. For viewers who experienced interstitial ads the results were 40% and 49% respectively.
Significantly, the study found that embedded, opt-in ad viewers are also more motivated. Motivation, which is a key brain imaging metric refers to the feeling of “wanting” that ultimately drives desire and decisions. High motivation levels in the brain therefore imply purchase intent and action.
“Those who experienced the contextual ad unit [embedded, opt-in ad unit] had four times a feeling of motivation according to neurometric measures,” the study concludes. In total 25% of embedded, opt-in ad viewers said the ads made them want to keep using the app.
This is a far cry from the “fight-or-flight” reaction triggered by full-page interstitial ads — and should send alarm bells ringing in board rooms everywhere on the planet, according to Richard Kosinski, MediaBrix President & Global CRO. “The key message is that the interstitial, the most common ad format, is also the format that users find most annoying and disruptive,” he explains. “Publishers need to consider formats that do not create a negative experience for their readership.”
He urges the industry to “rethink ad delivery and ad format” and remember the core importance of the user experience they deliver, not just the content.
The explosive growth of mobile apps — and the increase in the amount of time consumers spend on them daily — turns up the pressure on publishers to rethink mobile advertising and how they monetize their content. “Eyeballs have clearly shifted to mobile and mobile apps and publishers have to focus their efforts on creating a good user experience for their audience,” Kosinski says. “Our research shows that just running interstitials on mobile and in apps isn’t the way to achieve this.”
This dovetails with the 2016 U.S. Mobile App report released by audience measurement company comScore. It estimates that mobile now represents “almost two out of three digital media minutes.” As a result, mobile apps are approaching 60% of total digital time spent by consumers by platform.
Kosinski, a 25-year veteran in the media business who has held a variety of senior roles at brands including The Wall Street Journal, Yahoo!, CNET, Quantcast and Westwood One, advises content companies to rethink mobile ad creatives, not abandon them. The positive response by respondents to embedded, opt-in ad formats suggests that consumers might whole-heartedly embrace monetization models that reward them for watching a video, for example. “The result is a better experience for the consumer, who gets to read the article behind the pay wall, and higher engagement and higher CPMs for the publisher that enables this value exchange,” he says.
Opt-in ad experiences put consumers in control, but it’s not enough for publishers to change their creative message. They should also embrace the formats and delivery mechanisms proven to provide a positive user experience. This milestone study doesn’t just provide the industry with valuable blueprint to improve ad receptivity, human attention and brand recall. It bravely delves into the emotional and physiological traits and triggers publishers must understand to ensure their message (and marketing) is truly aligned with the mobile medium.
Peggy Anne Salz is the Content Marketing Strategist and Chief Analyst of Mobile Groove, a top 50 influential technology site providing custom research to the global mobile industry and consulting to tech startups. She is a frequent contributor to Forbes on the topic of mobile marketing, engagement and apps. Her work also regularly appears in a range of publications from Venture Beat to Harvard Business Review. Peggy is a top 30 Mobile Marketing influencer and a nine-time author based in Europe. Follow her @peggyanne.
Digital advertising revenue increased to $32.7 billion in the first half of 2016, increasing 19% from the same time period a year ago, according to the Interactive Advertising Bureau’s Internet Advertising Revenue Report. The shift to mobile advertising was a key driver in the increase of digital ad spend. In fact, mobile advertising revenue totaled $1.6 billion, a 178% increase from the same period in 2015. Mobile advertising now account for 47% of all online ad revenues for the first half of 2016, up from 30% the prior year whereas desktop video ads remained the same at 13% of total revenue.
Among the key trends reported:
Display
Total display-related advertising (mobile + desktop) is up 26% to $13.9 billion and accounts for 43% of all internet ad revenue.
Display-dollars are also shifting to mobile: Mobile display is up 78% to $7.6 billion while desktop display is down 7% to $6.3 billion.
Video
Total digital video ad revenue (mobile + desktop) is up 51% to $3.9 billion.
Video now accounts for 12% of internet ad revenue for the first half of 2016, up from 9% in HY 2015.
Social media
Ad spend on a whole for social media increased to $7 billion, up 57% from one ago.
Other key findings
In terms of pricing models, performance-based pricing, defined as cost-per-click, sale, lead, acquisition, or application (e.g., credit card application) or straight revenue share (e.g., percentage of commission paid upon sale), continues to lead although slightly declined to 65% of total revenue in HY 2016.
CPM/impression-based pricing increased up to 34% of revenues in the first six months of 2016 from 32% in HY 2015.
Hybrid pricing, defined as any mix of impression-based pricing plus performance-based compensation within an ad campaign, declined to 1% of total revenues in HY 2016, down from the 2% reported in HY 2015.
The report also stated that digital ad spending is becoming more concentrated with the top 10 digital ad-selling companies accounting for 74% of online advertising revenues in Q2 2016. The 10 companies were not disclosed in the report.
Many are forecasting that digital advertising will continue to be a larger and larger share of overall revenue generation for businesses. The question is who is capturing the increased profits? In an article in the Financial Times, Anna Nicolaou notes that “Google and Facebook have capitalised on the rise of the smartphone, swallowing the lion’s share of digital advertising revenues. In the US, 85 cents of every new dollar spent on digital went to the two companies in the first quarter of 2016, according to Morgan Stanley.”
Peter Kafta of Recode also offered insight the companies capturing the profit margins. Kafta’s shared the individual analyses done by Jason Kint’s, CEO of Digital Content Next, and Brian Wieser’s, an analyst at Pivotal Research, each illustrating that Google and Facebook account for 85% and 90%, respectively, of every dollar spent on digital. Their analyses also indicated that while Google’s and Facebook’s captured significant growth of ad revenues, the rest of the digital marketplace is diminishing.
It has been a few years that native advertising is being actively placed in the market. With the year-end approaching, it’s a good time to take stock of what we now know. At MediaRadar, we’re now not just tracking native ads, but also studying how native is bought & sold, and are coming to a view of what is best practice. Posted below are some of our key findings.
Native, a saturated market? Surprisingly the market is not yet saturated. Over Year 2016 we’ve tracked a median of 610 new advertisers buying native, for the first time ever. This is substantial. And we’re finding native ads across b2b, enthusiast, regional, and science media. Native is no longer for certain large consumer sites.
Renewal rates. To provide an average here would be misleading. In fact what we see is polarized renewal rates. Out of the ~1000 websites that sell native, most have low renewal rates, under 30%. This is going to make scaling up native advertising a significant challenge. In contrast, there are a few dozen firms that are very focused on client success. They enjoy renewal rates above 70%. This includes some of the best performers, including brands like Quartz (QZ.com).
Campaign packaging. We observe that it’s exceedingly rare to see native advertising running stand-alone. It’s much more common that native advertising runs as part of a broader campaign. The most common campaign is to run display for 30 days, then 30 days of both native and display, and then a final month of display.
Duration analysis. Across 16,998 brands that have placed native over the past 2 years, the most common is one month only. It’s surprisingly brief. Just under 20% of brands are running campaigns for six months.
Programmatic vs. Direct. In the past two years we’ve seen the rise of programmatic native – both display and in video. Without question, the product is marketing different than direct native. Programmatic native is display advertising that looks-and-feels like editorial. However, these ads don’t typically link to sponsored editorial. In contrast, direct native does. This is the kind of programming that Buzzfeed, Forbes, and Huffington Post are especially so well known for. Posted below is an overview of the massive growth we’re seeing from some of the leading programmatic native companies. This includes name native exchanges such as Nativo, TripleLift, Sharethrough, Bidtellect, Teads, Unruly, and Giant Media.
Recommendation. Native advertising renewal rates correlate tightly with campaign duration. Those winning six-month deals have the highest average renewal rates, with the lowest renewal rate variance. In surveying those most successful publishers we heard consistent feedback: Require clients to commit to longer term deals. This gives you, the publisher, more time to course-correct, to respond to client needs, adjust creative, adjust marketing support, to absolutely make sure that you’re helping the client meet their campaign objectives. This, more than anything, drives up renewal rates.
Number of programmatic advertisers placing in the year 2016
Todd Krizelman is Co-Founder and CEO of MediaRadar (@MediaRadar). Growing up near the epicenter of technological innovation in Palo Alto, California encouraged him to become an entrepreneur and co-found of one of the world’s first social media sites, theGlobe.com. Krizelman also held leadership positions at Bertelsmann’s Gruner + Jahr and Random House. With his expertise in ad sales and innovation, Krizelman joined veteran web architect, Jesse Keller, to found MediaRadar in 2007.
Web scraping is a technique that allows people to easily extract large amounts of information from around the web – for legal and illegal uses. Distil Networks’ 2016 Economics of Web Scraping Report notes that bots, which make up approximately 46% of web traffic, often conduct the web scraping at a faster rate than humans. The Report found about two percent of online revenue is lost to web scraping.
Key findings also noted in Distil Networks Report:
38% of companies engaged in web scraping to take content.
Web scraping is inexpensive costing about $3.33 per hour.
The average web scraping project costs approximately $135.
Real estate sites are the #1 web scraping target.
The average web scraper salary ranges from $58,000 to $128,000 per year.
There are six primary reasons for web scraping:
Content scraping: stealing original content from one website and posting it on another website without the knowledge or permission from the publisher;
Research: gaining marketplace intelligence;
Contact scraping: acquiring customer emails and contact information for marketing and lead-generation;
Price comparison: competitors in the real estate and travel industries see a lot of this activity;
Weather data monitoring; and
Website change detection: notifying users about changes made to specific websites.
It’s important for publishers to understand the extensive web scraping economy so they can take steps to protect their proprietary information.
Anyone who’s been buying digital advertising for more than a minute has been faced with the daunting question from marketing and non-marketing executives alike: “So, how much of this advertising is actually legit, anyhow?”
The industry has been hounded by issues relating to viewability, engagement, and outright fraud for the past couple of years, and the general business press regularly covers the subject matter. So the very same executives who authorized TV, print and radio advertising budgets without raising question one only a few years ago – when the “half of my marketing budget is well-spent, but I’m not sure which half” maxim was fully embraced – now regularly engage in forensic assessments of ad buys. Such is the life of the digital marketer.
So it is helpful that companies like Integral Ad Science (though not an entirely objective player in the digital marketing ecosystem) working to keep track of developments via its bi-annual Media Quality Reports.
However, depending on one’s point-of-view, the data can be considered a sign of improving conditions, or confirmation that we marketers knowingly *throw away* 10% or more of our budgets to fraud, deception, and advertising malpractice.
Here’s a look at IAS’s most recent report, which offers an analysis of “hundreds of billions” online display and video ad impressions during the first half of this year:
Conditions Are Improving. Though there continues to be a good deal of waste in the system, the overall state of online advertising is showing signs of improvement. For example, the U.S. market saw a significant drop in “objectionable content” impressions during the first half of 2016 versus the previous period (9.5% versus 14.0%). Most industry experts agree this is due to more sophisticated tools and digital ad buying practices, as one would expect in a growing and evolving industry sector.
Buying Direct Has Its Benefits. The incidence of ad fraud when buying advertising direct from publishers is dramatically lower than when buying programmatically (2.2% versus 8.3% in the U.S.), though it’s also typically more expensive, making the equation palatable for most marketers.
Viewability & Clutter Are Continuing Concerns. Fewer than half of all display ads – regardless of how purchased – get viewed for more than five seconds, and more than 10% of ad impressions are jammed onto pages with more than four ads on the page. These issues are compounded via mobile devices, which we cited in a recent article on the pros and cons of programmatic as “just a messy consumer experience”.
Bigger & Vertical Are Better. Large format, vertically-oriented display ad formats (300×600, 300×1050, 160×600) all tend to have better viewability than their smaller, rectangular and square counterparts – being viewed for more than five seconds about half the time.
Global Video Ads Are Best Purchased Direct. Viewability of video via programmatic means are only viewable at a 3-in-10 ratio, versus nearly 7-in-10 via publisher direct. This metric constitutes the biggest relative weakness of programmatic in the study.
While IAS’s analysis of the first half of 2016 has many encouraging findings, it’s also clear that the programmatic marketing industry has plenty of opportunities for improvements in the coming months and years.
To state that marketers continue to be challenged by the ever-expanding digital marketing ecosystem is neither pejorative nor insightful. Indeed, the marketplace is aggressively evolving, as evidenced by both the sector’s growth—20%+ growth last year (IAB) and its prediction to overcome TV advertising this year (eMarketer)—and the number of vendors rushing to get in on the action (the ad tech market increased to more than 3,500 in 2016 from about 2,000 the previous year, according to Scott Brinker at ChiefMarTech.com.
Marketers are spending more than ever on the digital channel, and there are a plethora of vendors competing to ostensibly help these marketers spend their budgets more efficiently. Thus, as the saying goes, “If you aren’t confused, you aren’t paying attention”.
But it’s the job of think tanks like Forrester Research to help their clients sort through marketplace complexities and make smart decisions to help their organizations succeed. And it’s with this goal in mind, the firm recently published “The Forrester Wave: Marketing Measurement & Optimization Solutions, Q4 2016”. Chock full of recommendations for B2C marketing professionals, who are seeking to stretch budgets to the limit and outmaneuver competitors, this study provides analysis of companies that provide analytics and measurement solutions. The report is based on an examination of 10 vendors and surveys with 77 marketing professionals.
Here are some key takeaways, organized into two groups of findings: undisputed and to be determined (TBD):
Undisputed: Consumers are interacting with brands in varied ways. The report emphasizes this new market reality by explaining “Empowered consumers easily absorb information from all forms of media and multiple devices, and hey comfortably straddle the digital/traditional media divide”. While this new reality presents marketers with many new channels to engage with prospects and customers—a good thing—it also makes performance tracking increasingly difficult—a big challenge.
Undisputed: Marketers are under more pressure than ever to be accountable for their budgets and demonstrate ROI. The rise of digital advertising, which will account for nearly 50% of total marketing budgets in a couple of years, has mostly been a boon for marketers, with one glaring exception: scrutiny. Since its very early days, major industry players have been touting digital marketing for its ability to be “100% trackable”. So it comes as no surprise that “today’s complex marketing environment challenges marketers to meet the C-suite’s demands for accountability.” And the right measurement solution can solve this potentially massive headache for CMOs.
Undisputed: Marketers require strategic advisory partners that can help them make sense of data and act upon the analysis in meaningful ways. Translation: while vendors need to be able to tout quality technology and toolkits, it’s more important for them to be able to offer consultative support, to help clients “interpret model results” and to “provide recommendations” based on the analysis.
To Be Determined: The Realistic Viability of Unified Marketing Impact Analytics (UMIA). The UMIA methodology—coined by Forrester in this study for the first time—involves combining traditional techniques such as marketing mix modeling and digital attribution into a single technique. While Forrester reports high customer satisfaction from this study’s survey respondents that manage such an environment (about 40 in total), we think the sample size is too small today to make a blanket judgment about the approach. Though the concept is certainly appealing, many industry experts consider it to be at best too raw, and at worst not applicable: “It’s like using the same assessment metrics to measure the performance of a jet plane versus a row boat…it just doesn’t make sense”.
To Be Determined: The Impact of New Entrants, Big Players & Market Consolidation. It’s notable that the only widely-known brands included in the Forrester study are the result of acquisitions: Google/Adometry and AOL/Converto. In the face of rapid growth over the past decade, brands have been racing to adopt and integrate the digital channel, not necessarily optimize its performance.The reality is that for all its real and perceived flaws, the digital channel remains more cost effective than alternatives in most industry sectors. As more and more dollars are allocated to digital, and more attention is given to performance optimization, it’s likely that new entrants will impact the sector—think Facebook, Adobe, etc.—and given the dearth of any category killers today, the marketplace could look very different in 24-36 months.
The programmatic display advertising marketplace in the U.S. will total $22 billion this year, up nearly 40% compared to 2015, According to eMarketer. Perhaps more importantly, these kinds of media buys will account for more than two thirds of the entire U.S. display marketplace.
Programmatic media buying—broadly defined as the use of technology and algorithms to effect the sale, purchase, and delivery of advertising, and specifically digital ads in this case (think: the Google Display Network, RTBs, and PMPs)—has grown dramatically in recent years. Indeed, eMarketer has gone so far as to claim that “Programmatic is extremely efficient and unparalleled in its ability to pair rich audience data with ad inventory and targeting.” As such, marketers are rushing to incorporate it into their marketing plans.
Given its meteoric rise in the digital marketing scene over the past 36 months, though, it should come as no surprise that there’s a good deal of misunderstanding surrounding what the tactic can and cannot do, and where marketers need to tread carefully. In its second year examining the issues, ExchangeWire and OpenX combined to publish “The evolving perception of online marketing quality in programmatic advertising” last month.
Here are some of the key takeaways:
Marketers have a love-hate relationship with programmatic. While advertisers are spending more than ever on programmatic, they also report having less confidence in the tactic than they did last year, and believe fraud rates are 5X what they deem acceptable. This kind of volatility is common across most digital tactics—and makes sense, given the newness of the category, its relatively low cost (compared to TV, radio, and high-end print), and complexity. Even when it’s working, it’s still going to cause a bit of angst.
Marketers are concerned about viewability and fraud. Among the most experienced users of programmatic—U.S. advertisers—only 3-in-10 survey respondents say that marketplace quality is a ‘very serious’ issue, while more than 90% of respondents in EMEA and APAC believe that’s the case. These are two high-profile issues that the industry needs to get under control—fast. But even with major media outlets keeping the issues in the news, experienced marketers know that a tactic like programmatic (warts and all) is going to continue to generate favorable ROI for the foreseeable future.
Programmatic offers value. While in 2015, 95% of survey respondents believed that programmatic advertising offered good value for the money, that percentage dipped slightly to 86% in 2016. But one interviewee explained: “Programmatic has become a victim of tall poppy syndrome where everyone is trying to knock it off the perch; people have increased their knowledge of the tactic, and more aware of its pros and cons – so as it becomes much more mainstream, I think the satisfaction number has only one way to go, and that’s down”.
The programmatic silver bullet train is nearing the end of the line. Just as is the case with any hot, new tactic or channel, there are lots of easy wins to be had in the early days. But as programmatic becomes increasingly popular and pervasive, it will become more difficult—not less—to implement successful programs. Vendors are rushing to invest in their programmatic offerings, making it more difficult for advertisers to determine the best fit for their organizations (RTB? PMP?), and publishers—the providers of inventory—are scrambling to find their way in this new world, too. Not to mention the onslaught of mobile into the mix, which will account for about 70% of U.S. activity this year and which one expert describes as “just a messy consumer experience”.
To say that programmatic advertising is wreaking havoc in the digital marketing sector would be an understatement. But marketers that maintain a steady hand on the wheel as they roll out programmatic strategies and resist panicking or over-correcting in the face of inevitable bumps-in-the-road and sharp turns will be amply rewarded.
Tim Bourgeois is the executive editor at ChiefDigitalOfficer.net, a global community of senior digital and marketing professionals. Follow him @ChiefDigOfficer and connect with him on LinkedIn.
In what seems to be a timely intersection with the furor over rebates, fraud, and lack of transparency in the online advertising community, a recent survey from Deloitte, Industry Index, and Flashtalking “Confined by the Garden Walls” highlights the increasingly volatile but interdependent relationship between the biggest advertisers and walled platforms – namely, Google and Facebook. Its findings “illustrate the disconnect between what clients want from their advertising platforms and what they can expect to get.”
Despite the fact that rebate issue continues to get regular coverage by major media outlets like The Wall Street Journal and Ad Age, few advertisers are rushing to openly join the conversation. In the same vein, conclusions from the study highlight the ongoing struggle to understand the dramatic contradictions at play. To wit: While “only 22% of brands noted discomfort with Google’s data policies,” at the same time, “95% think data transparency at a user level is important or very important.”
While it’s easy to highlight the obvious conflicts at work here, making sense of the situation is more nuanced. Our take:
Consolidated Market Conditions Dramatically Favor Digital Giants. In Q1 of this year, Google and Facebook combined to realize 85% of online advertising market share. So it’s not surprising that the two companies don’t have to negotiate terms and conditions much. This situation won’t persist forever – with Bing investing significantly in its platform, and Verizon’s acquisitions of AOL and Yahoo! expected to impact the marketplace – but it’ll continue to be a bumpy couple of years for large digital advertisers, absent of significant regulatory changes, which seem unlikely.
The “Lure of Ease” Has Very Strong Appeal. Few brands have been able to construct digital marketing operations over the past decade that can provide the requisite scale. This will happen in due course, as “marketers at top brands have long realized that to own your customers you have to own your data”. And they’re investing furiously in marketing infrastructure to get there. In the meantime, they need to continue to nurture uneasy alliances with the digital behemoths in order to feed their own massive marketing engines.
Even With Challenges, Digital Preferable to Alternatives. Sure, brands are forecast to spend a smidge more on digital advertising this year than TV, for the first time, to capture $72 billion (36.8% share) in the U.S. marketplace – which is forecast to total $195 billion in 2016. But that means they will spend more than $120 billion on TV, radio, print, and out-of-home – all of which are generally considered to be inferior when it comes to ROI precision or user data access.
Alternatives Do Exist, But Require Work. Without question, Google and Facebook offer incomparable digital advertising scale and targeting – one-stop shopping at previously unimaginable heights. And their brands are of course blue chips, and no one appreciates top brands like marketers do. But taking a scrappy approach to digital marketing can pay dividends. Going off-brand allows advertisers to strike better deals, and not just lower prices, but also much greater transparency and data control. This is approach requires legwork and explanation up-and-across the organization about avoiding the recognizable brands, and might not even perform as well in the final analysis, but in some (possibly many) situations, a beat-up pickup truck can do the job almost as well as a shiny new Cadillac – and for a fraction of the cost.
Tim Bourgeois (@ChiefDigOfficer) is a partner at East Coast Catalyst, a Boston-based digital consulting company specializing in working with clients on strategic roadmaps, digital marketing audits, and online marketing optimization programs.
“What if we stopped focusing so much on traffic, and started focusing on experience?” I’m asked this question frequently. It’s a complex, divisive challenge for newsrooms, one I eagerly indulge.
I work directly with media companies of all shapes and sizes. I offer consultation on everything from using data to support editorial intuition, experimenting with audience development projects and honing tagging strategies. The best newsroom strategies start with someone saying to me: “It would be so interesting if we could…” and “What would happen if we tried…”. Data can provide the foundation for sussing out those new ideas while mitigating risk.
When I start to talk to clients about using engaged time, or any metric for that matter, the key is to set goals. What does success look like? But this prompts new questions: How do we stack up? Is this kind of engagement normal? Is it good? For us? For anyone?
There is no reliable comScore or Alexa rating for attention, thanks in no small part to various ways of measuring “time on site.” So if a publisher is eager to change the way they think about their audience, and their success, where could they start? I tried to find out.
How does Parse.ly measure engaged time?
First, let’s clarify exactly what we’re talking about, because Parse.ly measures engaged time differently than other analytics platforms. On your site, a visitor is considered “engaged” if they 1.) Have a browser tab open, and 2.) take an action (scroll, click, mouse-over) at least once every ten seconds.
Analysis 1: How do we find an average engaged time for all content?
Weighted engaged time averages from a random sample of posts from 300 domains in our network gives a benchmark for engaged time.
I first set up an exploratory analysis across our network, to see if I could identify any clear patterns. Over time, I started to see the same sites consistently outperform other outlets in average engaged time per visitor. What initially struck me though was actually the lack of pattern: each site seemed so diverse in voice and size.
To identify what made them competitive, I needed to understand the bigger picture of engaged time across Parse.ly’s network. To do this, I sampled user experiences at random for content published within one month from 300 anonymized domains to first understand, “how many seconds can you expect a typical reader to remain engaged with a story?”
Here we see how attentiveness is distributed across Parse.ly’s network. This graph shows what we can expect for “normal” attention time from any given reader, to any given article for each of the sampled domains. You can see a majority of our publishers attract an audience willing to invest roughly 40-60 seconds of their time on an article, though plenty of publishers can expect a more invested audience.
Finding engaged time in Parse.ly’s dashboard
This provided a starting point for benchmarking engaged time, especially for my clients. Any Parse.ly user can easily find in their dashboard where their site, section or article falls on this curve. Teams can check to see if their stories and authors fall above or below the norm for their audience.
Understanding the context here is crucial though; not every article needs to outperform the average of the Entire Internet. There are better questions to ask. Where does your article fit in relation to what is expected for its section? How does that section perform in relation to the site as a whole?
Of course, there’s one more comparison that everyone wants to make: how does my site stack to the competition?
Analysis 2: How do we find the averaged engaged time for similar content?
This question helps you contextualize whether your work gets more attention than pieces that are similar to it and potentially predict how other topics, outside of your core competencies, might perform. For example, if you don’t normally write technology feature, it could help to understand the engaged time benchmark for tech publishing leaders. Here, we break down the analysis above further to understand how long a reader could be engaged on similar content.
Broken out by publisher type, it’s easy to see how nuanced attentiveness is across different types of content. I found it noteworthy that local news sites command more engagement than major news outlets, even with undoubtedly fewer resources.
I mentioned earlier when I began investigating engagement, I was struck by how, month after month, the same set of publishers kept leading the pack, albeit with no discernible pattern among them. Broadening the analysis to the network, broken down by these categories, most of these names resurfaced at the top of their respective categories. A pattern finally became clear: the most engaging sites within each type of publisher were highly recognizable brand names.
Also, now that we’ve broken out engaged time averages across Parse.ly’s network, it’s easy to see how using homogenized data from a heterogenous group of sites to set benchmarks could do more harm than good. Certainly, the same concept applies within the newsroom; measuring the average engaged time on an article against what is expected for that vertical or topic will provide better context.
What do we know about engaged readers?
We’ll continue to explore other patterns within the most engaging experiences. In the meantime, here’s a reminder of what we do know:
Facebook vs Twitter. We already know from a recent study with Pew Research that, in an increasingly mobile ecosystem, referral sources on mobile were an important factor in determining engaged time. Their research found that Tumblr and Twitter generate highly engaged audiences, while Facebook audiences were less engaged.
Readers can be highly engaged on mobile, though infrequently. In another section of the same report, we distinguished between long-form articles with 1000+ words and short-form articles. Long-form consistently outperformed short-form, though visitors to either do not frequently go on to other articles.
In the analysis conducted for this post, we found no correlation between page views and engaged time. A large audience is not necessarily an attentive one.
How to navigate this brave new world
We’ve found ourselves in somewhat uncharted territory in an effort to shift away from primary traffic metrics like page views and unique visitors. How do we define what makes something “good” anymore? Why should we care about engaged time at all?
As I found in this analysis, the engaged time metric provides us an interesting exploration in how we can set a more relevant benchmark. In clinging to familiar traffic indicators like page views, perhaps we have systematically neglected not only the experience of our readers, but the nuance of our reporting. But coupling traffic metrics with engaged time helps us understand which articles create the most impact.
If your post gets hundreds of thousands of viral views, but no one sticks around to read it, did you really manage to convey anything meaningful? Increasing your newsroom’s dedication to understanding the relevancy of engagement in all its forms will lead to a deeper, better audience strategy.
Kelsey Arendt is a Customer Success Manager at Parse.ly. Previously, she worked with The Guardian’s commercial team where she managed a variety of projects for marketing and sales, including developing analytic support for sponsored campaigns and partner hubs. Kelsey is a Midwestern transplant to New York City, and is a passionate hiker, musician, and homebrewer.
Crafting and adapting a marketing strategy to changing circumstances can be difficult with a lack of data. Predicting and preparing effectively for negative trends becomes much harder with poor insights. Even reporting to senior management or investors without sufficient data can create additional obstacles to gaining support for further campaigns.
Joe Liebkind is a Berlin-based writer. He has worked with startups in sales and marketing roles in Berlin and New York. Find him on 
Conditions Are Improving. Though there continues to be a good deal of waste in the system, the overall state of online advertising is showing signs of improvement. For example, the U.S. market saw a significant drop in “objectionable content” impressions during the first half of 2016 versus the previous period (9.5% versus 14.0%). Most industry experts agree this is due to more sophisticated tools and digital ad buying practices, as one would expect in a growing and evolving industry sector.
Tim Bourgeois (
Despite the fact that rebate issue continues to get regular coverage by major media outlets like 
Broken out by publisher type, it’s easy to see how nuanced attentiveness is across different types of content. I found it noteworthy that local news sites command more engagement than major news outlets, even with undoubtedly fewer resources.