Auditing Digital Marketing: Promotion (Part II)

Dec 19, 2014

by Tim Bourgeois | Digital Marketing Consultant | East Coast Catalyst

Earlier this month, we began this Auditing Digital Marketing article series by addressing

the "infrastructure and applications" area of a digital audit. This week, we'll look at what we call the

"promotion" component -- which is comprised of any online tactic that's used to drive website traffic

and digital engagement: search, display, social, content, mobile, etc. (The chart below illustrates where

promotional activities fit within our audit methodology.)

Promotion is often the largest line item in a digital marketing budget, and comes in the form of both

media buys and agency contracts. This kind of activity receives a lot of attention from senior managers

because of its growing share of the total advertising budget (online + offline). Accounting for just a few

percentage points of all U.S. ad spending in the early 2000s, digital media chewed up 24% of budgets

this year, according to new research from Forrester. And that share is expected to increase steadily for

the foreseeable future, overtaking television soon.

There are non-media costs to consider as well when discussing digital promotion, of course, such as the

talent and technology required to set strategy, manage vendors, and optimize performance. And this

can be significant, as digital advertising typically requires more hands-on involvement from marketing

groups than TV or print. But since the media component is easier to isolate and benchmark, it makes for

a good target during an audit.

When it comes to digital marketing and promotion, most of us continue to rely on channel- and volume-

centric strategies, and with good reason. Though imperfect, a strategy organized primarily around

specific tactics and making the most of resources allocated to those tactics is manageable: it can be

readily measured, communicated up and across the organization, and predicted with an acceptable level

of confidence.

Emerging and sophisticated techniques such as attribution modeling or programmatic buying are

appealing and should be worked into long term plans, but can be time-consuming and costly to

implement in the short term. Most importantly, emerging techniques are, by definition, difficult to

forecast. Experimenting in a domain as volatile as digital marketing is a cost of doing business, but

should only cost a few percentage points of budget. In our experience, the best way to make due with

tight budgets and swelling expectations is to focus efforts on refining proven tactics while carefully

choosing which new techniques to work into the mix.

With this background and set of assumptions in mind, we address four hot-button items related to

digital promotion in this piece, and offer recommendations for making improvements in 2015.

TAKE A LONG, HARD LOOK AT SEARCH MARKETING

Background: Paid search marketing (PPC) accounts for 40%+ of all digital advertising. Though a relatively

mature digital tactic, many companies continue to struggle with optimizing search marketing operations

– which include both paid and organic - because of stale management strategies. Given the significant

spending that goes into search marketing, even modest improvements can have a big impact on overall

digital marketing performance.

In a recent article by McKinsey - "Five Ways to Get More From Digital Advertising" - the authors state:

"In our experience, companies may be leaving as much as 20% to 30% of potential [digital advertising]

returns on the table." They cite "uncoordinated external agencies," as one of the reasons for this under-

performance, and go on to say: "the agency handling the paid search budget may be different from the

agency advising on organic search-engine optimization (SEO)".

While it may seem obvious to non-marketers that paid and organic search teams should be

collaborating, that hasn't historically been the case, and this can be easily explained. Paid search

advertising relies heavily on media buying skills while organic search marketing involves editorial and

technical skills. (Both depend on fundamentally sound user experience strategies to be successful and

optimized.) The natural intersection of paid and organic search marketing activities is in keyword

strategies, but the day-to-day mechanics don't necessitate regular cooperation.

However, both disciplines are evolving rapidly and that is changing the rules. Google made 13

updates to its algorithm in 2014 alone, and many experts argue that paid search marketing is quietly

overtaking organic's importance. So while managing an integrated search program is tough, it can yield

fast results, if only because of search marketing's impactful role in “bottom-of-the-funnel” buying

behavior, and because it's an area where companies are already allocating significant dollars, so

incremental improvements matter.

Takeaway 1: If you rely on a combination of internal and external resources to manage search

marketing, insert a "search marketing director" (or equivalent) to be responsible for overseeing all of the

activity. This staffer should be allowed to allocate at least 50% of his or her time to the task if search

spend (paid + organic) exceeds $500,000/year. Using the conservative end of McKinsey's estimates -

20% improvement - this means that even a $1 million search budget (paid + organic) can cost justify this

new role (assuming the total annual employee cost is $100,000).

Takeaway 2: If you outsource all search marketing activity to external vendors, reorganize the vendor

portfolio to get all search activity to reside at one vendor. If this isn't possible for whatever reason (e.g.,

contractual obligations), require all of the vendors to operate in a coordinated manner. Assign

coordination duties to one vendor, which will serve as a "general contractor" for all search-related

activities (paid, organic, content marketing, analytics).

Expected Challenges: Lobbying for a new full-time position is always time-consuming, as is taking a

new approach to vendor management.

RESIST MOBILE AT YOUR OWN PERIL

Background: With phone and tablet internet usage officially overtaking PCs this year, a mobile strategy is

a must-have in every digital marketing portfolio.

Mobile had a monster year in 2014, book-ended by Facebook’s acquisition of What’s App for $22 billion

in February and Uber’s second fundraising round of $1.2 billion during the year in December. A steady

flow of venture investment dollars will fuel its continued rapid expansion. These factors contributed to

mobile emerging as a mainstream tactic for marketers.

And while it means marketers have yet another channel/tactic to contend with, it also offers new

opportunities. In a recent white paper, the Mobile Marketing Association advised: “Agile marketers who

see the opportunity, move first to embrace [mobile], and act analytically and rationally to test, learn,

and continually optimize their mobile execution will win. To the winners will come significant financial

spoils at the expense of mobile laggards – and all by using same ad spend budgets, but for better

results.”

Takeaway: Mobile marketing at even the most aggressive big company will remain a small percentage

(1% - 10%) of digital advertising spend. So making dollars available for mobile efforts won’t be a big

challenge. But, as a new tactic in the mix, learning curves will be steep, and characterized by iterative

test/measure/repeat cycles.

Expected Challenges: Every senior executive -- marketing or non-marketing or otherwise -- has a high-

performance smartphone or tablet these days, so mobile efforts are high profile and ripe for scrutiny.

PREPARE TO ACTIVATE A 'MULTICHANNEL MARKETING' INITIATIVE

Background: Multichannel marketing is one of the most frequently discussed topics among digital

marketing executives these days. But given its relative newness, you still have time to get out ahead of

the pack if you make a move in early 2015.

At the Gilbane Conference this month in Boston, 40% of the 35 breakout sessions had 'multichannel' in

its title. A friend of mine who heads up a global digital agency told me that 75% of the RFPs he's

reviewed during the second half of this year had 'multichannel' in their title. Though a common

definition of exactly what multichannel is doesn't seem to exist, the concept has most definitely arrived.

In broad terms, multichannel digital marketing strategies define an organization’s plans to communicate

with constituents across myriad online channels (website, search, social, mobile), as well as how to re-

purpose content among those channels. (For example, this article will be posted on LinkedIn in entirety,

summarized on our blog, and Tweeted about several times.)

Multichannel strategies can also extend to offline marketing tactics and interactions – such as in-store

promotions. The inclusion of offline along with online in the multichannel discussion is sometimes

referred to as ‘omnichannel’ marketing. So a company like New Balance or Burger King needs to

consider websites, mobile apps, TV advertisements, retail shops, and stores in their multichannel

strategies, as well as the unique geographies and demographics they serve. It gets complicated fast, and

isn't easy to execute.

Takeaway: Be prepared to be asked about your multichannel marketing strategy by non-marketing

managers, as it’s become that pervasive. If you haven't already, begin familiarizing yourself with the

multichannel landscape by launching a product- or campaign-specific effort, and go from there.

Expected Challenges: Multichannel marketing is near impossible to plan for and execute across an

entire marketing organization at a large company or a sizable business unit ($500M+ in sales).

(Note: for a more detailed discussion on multichannel, including a list of do's and don't's to consider,

check out Multichannel Content Marketing Is Your Next Challenge: Here’s How to Overcome It at

eContent Magazine.)

REVISIT YOUR EMAIL MARKETING STRATEGY

Background: David Carr of the New York Times explained the revival of email newsletters in his recent

article, For Email Newsletters, A Death Greatly Exaggerated. He says: "Newsletters are clicking because

readers have grown tired of the endless stream of information on the Internet." We agree.

Email newsletters lack luster. Compared to high-flying digital marketing categories like social media and

mobile, email seems like a relic in comparison. But they are quietly on the upswing, and can pay big

dividends when done well. To wit: a Gigaom Research study found that U.S. digital marketers named

email the most effective tool for awareness, acquisition, conversion and customer retention. Even

consumer feelings about email are improving, according to a recent survey by Forrester, especially when

communiques are tailored and personalized.

Takeaway: A multifaceted digital marketing operation that is already generating a steady flow of

original content can launch or expand email newsletter initiatives without an extraordinary effort. The

approach should rely on two broad tactics: 1) As a community-building and nurturing tool aimed at

current customers, partners, investors, and even friends and family; and 2) As a more stereotypical

direct marketing tactic for acquisition efforts. Assuming that no marketing manager wants to feature an

email newsletter as a shiny new concept during this year's strategy sessions, we recommend a quiet

launches of new efforts (or re-launches).

Expected Challenges: The cornerstone of high performing email newsletters are homegrown, opt-in

mailing lists, which take time to build. However, many companies have dormant lists that can be

revived, but this needs to be pursued carefully, so as not to disrupt other digital marketing efforts,

such as organic search.

ABOUT THE AUTHOR

Tim Bourgeois is a partner at East Coast Catalyst, a Boston-based consulting firm specializing in

delivering digital marketing and media audits to corporate clients. He’s also the founder of

ChiefDigitalOfficer.net, a community of senior professionals whose responsibilities intersect

strategy, marketing, technology and innovation. Contact him at tbourgeois (at)

eastcoastcatalyst.com or 617-341-6400, or follow him on Twitter @ChiefDigOfficer.