Digital Advertising in a New World

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Author: Maggie Walsh

We all know that feeling . . . you were just emailing or texting a friend about something, and suddenly an ad for that thing pops up in your Gmail and haunts you for weeks. You feel like “big brother” is virtually watching you, and you wonder how much he knows. As recent news is telling us - quite a bit, probably. But, that’s not the only problem with digital ads. Do they work? Does anyone click on them purposefully? And is advertising anywhere except with Google or Facebook worthwhile?

According to AdAge, an industry web site, the internet surpassed newspapers as the second largest advertising medium (after TV) in 2012.  An average of 89% of Americans watch TV at least once a week. But, just like print, times are changing. Video killed the radio star, and YouTubers are killing the sitcom star. More and more people are moving to streaming services and cutting the cable cord. In order to stay relevant, advertisers have to be nimble and react quickly to the market - go where their customers go. Nielsen reported that digital ad campaigns reach their intended audience 59% of the time, and mobile ads are even stronger for reaching narrower target audiences.

One advantage of online advertising is that digital advertisers have the ability to customize their advertising, using algorithms that track user clicking habits and recent page views to provide custom messaging on targeted web sites. However, this practice can make users uneasy about personal data being collected, and companies have no control over where their ads are landing. Some companies may not want to be associated with certain web pages that customers are surfing. And, quite frankly, digital ads can be annoying. Videos pop up loudly in a public place, or you can accidentally click on an ad, taking you away from your intended destination.

In a recent report from Zenith, Google and Facebook represent 20% of global ad spending, almost double the percentage from 2012. Google alone received 79.4 billion in ad revenue in 2016. Advertising with Google in some capacity is almost a requirement at this point for any internet-based business, and you have to pay to play - the pay ain’t cheap. Even though the Facebook and Google behemoths of the internet take up a large chunk of effective advertising, new and creative avenues open up all the time.

New digital advertising opportunities pop up as quickly as technology changes. Social media and podcasts are a few relatively new ways to advertise. Companies use “influencers” to sell their products to their engaged audiences, almost like getting a recommendation from a friend. For example, I can’t tell you how many Instagram accounts and podcasts I’ve seen MVMT watches advertised on. They launched in 2013, and already have grown to over $60 million in revenue, according to Forbes.com. Companies can make a smaller investment with a smaller, more engaged audience, in addition to more traditional digital advertising.

Digital ads have to move and adapt as fast as the internet does in order to stay relevant and effective. Advertisers are challenged to engage their audience and find new ways to reach them in meaningful ways. As soon as consumers learn to navigate around unwanted ads, the advertisers have to come up with a better plan to reach them.  As for me, excuse me while I buy those shoes from the banner ad to my right.