The scary online advertising trends you need to fight against

"Brands have learned that appealing to the largest population possible, with the most universally sound message, means more impressions for less money.

The problem is that they’ve forgotten how to talk with the people who matter to them most.

It’s not about counting impressions; it’s about making one.” (Elisa Cool, VP Brand Development at Contently)

Advertising might not be the best use of your marketing budget.

You don't need to keep paying good money to rent another publisher's audience.

You can't keep spending to attract a new sale.

Instead, you need a plan to build and nurture your own audience into repeat customers.

The problems and dangers of online advertising are both serious and significant. The return on your spend is in question, and the long term viability of the industry is under genuine threat.

It's time you stopped relying on advertising to bring you more customers. I want to show you how to develop a marketing plan that will help you own an audience of loyal repeat customers, so you don't have to keep spending on digital advertising.

Short On Time? Your Skim-Read Summary: 

Too busy to read the whole thing? We get it: logistics, synergies, KPI's - all that stuff. Here's the skim read version. You really should read the whole article though...

You can click on the dot point that takes your fancy and head straight to the relevant section.

Online Advertising is broken, and you need a plan to deal with it

It's not just because global ad-blocking rates increased by 41% in 2015, with Apple announcing an optional ad-blocker has been added to the iOS9 version of Safari on tablets and mobiles.

It's not just because in 2014 around one third of all online advertising traffic was fraudulently generated by bots, leading Bob Liodice, CEO of the Association of National Advertisers, to pronounce "the most important problem we have in the advertising and marketing ecosystem is fraud in the digital advertising supply chain".

It's because of a perfect storm of compounding industry conditions, raining down upon a group of mostly unsuspecting, unprepared and complacent brands.

If all this talk of an online advertising doomsday is news to you - it's time you brought yourself up to speed.

The problems with online advertising are real, and if you spend as much as a dollar on pay-per-click advertising, there's a good chance you might be getting robbed.

Here's 10 critical industry developments that have combined to create the online advertising mess we need to try and clean up.

(Click through on the dot point of interest to find a detailed explanation)

#1. Fragmented audiences are leading to cheaper ad rates

#2. Limited reporting and tracking complacency leaves an opportunity for fraudsters

#3. Reliance on engagement metrics clouds our measurement of effectiveness

#4. The squeeze on agency middle men means decreasing fees and cut-corners

#5. Declining transparency between client, agency, and publishers

#6. The replication of offline advertising into online formats

#7. Demand for ad-free content and the push to subscription business models

#8. Annoying, interruptive online ads

#9. The increasing usage of ad-blockers

#10. Publishers, ad agencies and industry associations aren’t helping

How do we fix online advertising?

Fixing ad-fraud is not the answer.

The bots are just part of the problem.

We can’t settle for the old status quo.

Take the music industry for example. Eradicating piracy hasn’t wrested control back to record companies that sell CD’s. There’s a bigger consumer behaviour change at play. The industry was clinging on for dear life against the irresistible force of change.

The people of the internet have spoken.

They are willing to pay good money to stop our online advertising.

Banishing the bots won’t fix this mess.

More valuable marketing just might.

The short term fix for online advertising bot fraud 

There's three simple steps to help you fix the online ad fraud problem.

#1. Develop stronger relationships with our agency and publisher partners.

You need to know what you’re paying for. They need to know that we care.

Ask for reporting on viewability. Challenge the rate for your campaigns based on these figures. Place the responsibility back on your advertising partners to manage the problem and increase the effectiveness of their advertising inventory.

#2. Stop focusing on impressions.

This figure calculates the amount of times an ad is loaded from one machine onto another. Bots are counted in impression figures.

And it’s not just bot fraud affecting our measurements. This quote from Venture Beat summarises most of the problems we face with current reporting standards:

“Even getting to 70 percent viewability is an overly optimistic expectation for many in digital advertising. Whether it’s bot fraud and scam publishers, or more mundane problems like ads failing to load, windows being obscured in the browser, or a user scrolling quickly up or down the page, there still isn’t even a reliable way to judge ad viewability, let alone guarantee it.”

You need to develop a conversion goal for your campaigns so you have a more concrete measurement of effectiveness.

You cannot rely on engagement metrics. Viewability measures are a requirement. We need to put pressure on our partners to monitor and manage effective delivery. We just can’t rely on it.

#3. Consider purchasing direct from publishers and media companies you trust.

A full 25 percent to 33 percent of all impressions purchased via exchanges are purported to be fraudulent. 

Without a third party, negligent or deliberate fraud will be minimised, especially if the publisher is measuring and reporting on viewability.

(Okay, so there may be a fourth step - for those of you playing at home. I've added in one last word of advice to help you establish a strong long term foundation for success.)

#4. Plan for the future. 

Find a better way to attract, convert and retain your customers. Don’t interrupt your target audience. Help them. Entertain them. Delight them. Make them genuinely want your marketing.

Develop a content experience that allows you to establish trust over time, and help your customers with all the information they need to purchase when they decide they are ready.

How to fix the broader online marketing problem 

How do you future-proof your brand against the problems of online advertising?

I've spent hundreds of hours researching this scary, complicated issue. 

There's no simple solution.

But I'll try to condense the best long term approach into a series of actionable takeaways... 

  • You need a plan to build an audience of loyal repeat customers
  • If you don’t have a mechanism to generate subscribers and build lasting relationships, you’ll need to continue to pay advertising dollars to other publishers to rent their audience
  • First step is to develop an integrated marketing strategy to help you attract, convert and retain more customers
  • Split up your buyer’s journey into a small number of distinct phases, and work on creating content experiences specifically designed for each
  • Instead of using advertising to convert (to persuade a customer to buy straight away)  - use it to attract more potential customers into your content program, and use your blogging, your email marketing, your social media and your website content to nurture your subscriber into repeat purchase.
  • Now, you can use online advertising to attract more users to your content and amplify your efforts, confident in the knowledge you have the structure in place to turn your advertising traffic into loyal repeat customers.
  • With specific objectives you can pinpoint the strengths and weaknesses of your entire marketing program, and your advertising efforts
  • Establish a specific, measureable conversion goal for your advertising to determine how effectively you’ve moved potential customers to the next stage of the buyer journey
  • Test, monitor and evaluate your content marketing program to make sure you're creating an online customer experience that can attract, convert, retain, and delight potential customers

How do you plan for a future without advertising?

Find a better way to attract, convert and retain your customers.

Don’t interrupt your target audience.

Help them. Entertain them. Delight them.

Make them genuinely want your marketing.

Develop a content experience that allows you to establish trust over time, and help your customers with all the information a customer could possibly need before making a purchase decision.

When your customers are ready to buy, you’ve earnt their trust, and their loyalty.

Don’t rely on advertising - get your own publication

You need a plan to build an audience of loyal repeat customers.

If you don’t have a mechanism to generate subscribers and maintain contact, you’ll be forced to continue to pay advertising dollars to other publishers.

If you want to futureproof your business from the turmoil attacking online advertising, you’ll need to develop an integrated marketing strategy - a plan to help you attract, convert and retain more customers without paying another publisher.

The simple answer?

You need a strategic content marketing program.

Start creating your own audience-attracting publication. Your business needs internal capabilities to create, promote and distribute content your customers actually want. You can create helpful, entertaining content to lure in new potential customers, and to add value for existing ones.

There’s no reason why your business can’t be the number one online information destination in your niche. Just ask the marketing teams from the spate of innovative fashion retailers launching their own brand publications. 

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The barriers to entry have never been lower, and it’s never been cheaper to access a niche audience.

If your brand creates the type of stuff your audience genuinely wants to consume - you no longer need to pay a publisher to advertise. You don’t even need to start your own miniature internal media empire from scratch.

Elisa Cool, the VP of Brand Development at Contently (and owner of the greatest surname in marketing) tells us all what’s wrong with the current marketing mindset - we haven’t moved on from the mass media traditional advertising days:

“Unfortunately, a lot of brands think the same way. They cast the widest net possible and end up alienating their intended audience."

There is a smarter way to invest the dollars you’ve been pouring into advertising…

Is it time to buy a publisher?

You’ve probably been paying a whole bunch of advertising cash to a publisher your target audience loves. Add that cash up. Is it enough to buy the whole damn show?

Maybe not, but it could run close.

Now think about the assets you would accrue for your business in return:

  • A whole bunch of expertly skilled editors, content creators and producers
  • An in-built institutional capacity to tell great stories
  • Access to a highly engaged, already established target audience
  • The opportunity to make money from your marketing (through paid subscription or native advertising)
  • Precious data archives to help inform product research, development and marketing decisions
  • Redemption of the opportunity costs required to spend years of time, money and resources trying to build your own audience from scratch.

This publication will add value to your business. Real value. Chunky-balance-sheet-asset type value.

Each new piece of content you produce puts another book on the shelf of an ever-expanding library, adding a compounding value to your broader asset.

The same article, video or podcast you publish today could still bring in new lifetime customers in weeks, months or years time.

What’s holding you back from buying an audience?

With all the benefits buying a publisher's audience contrasted with the challenges of building from scratch - what’s stopping brands from purchasing a publisher for their established audience?

Naysayers contend the 'agenda' of a brand may hamper the publisher's ability to tell independant stories - which could impact on the quality of the publication, forcing the company's staff to leave in droves.

This may be true of a traditional news organisation, but in most other industries the stakes aren't as high, and the readers aren't as cynical .

If a cosmetics company purchased Vogue, would readers leave in outrage? If the airliner Emirates bought National Geographic, would everyone stop watching, reading, and subscribing? As long as the quality standards are maintained or improved, the audience is just as happy consuming great content from a brand like Red Bull, Lego or Amazon, as it is from Disney, Cosmopolitan or Netflix.

Zac Zavos, Conversant Media Co-founder and Managing Director, agrees. With three online publications reaching a combined 2.8 million visitors per month, Zavos understands the future of the Australian online publishing industry better than most. As he says;

“If the content is good enough, and the audience is happy, why not?”

Although brands considering the purchase of a publisher struggling to fund its existence might have the best of intentions, it's still a hard sell to bring skeptical media professionals onside.

In 2015, popular ESPN online sports publication Grantland, was shut down due to difficulties raising advertising revenue.

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Proponents of the content marketing buy-an-audience strategy (including Joe Lazauskas in this piece from Contently) cried out for a brand like Nike, American Express, Sony or BMW to fund Grantland's stroytelling factory and delight the publisher's engaged readership of sporting enthusiasts.

Founder of the Content Marketing Institute, Joe Pulizzi, spells out a compelling argument for the buy;

"With Grantland comes a treasure trove of amazing (well indexed by Google) content and a prolific writing team.  But more than that, Grantland offers subscribers, who access its content and provide all types of amazing data about what they like, don't like, and their intent for purchase. 

And the best part is this - Nike, Under Armour, Puma, etc. could all buy Grantland for the cost of a rounding error of their total marketing and advertising spend. And instead of having to look at advertising as an expense (the ad shows and it's gone), they've just purchased an asset that will continue to reap benefits for months and years and decades to come."

It seems, the only significant barrier to the success of this strategy is the lack of conviction from the media industry to accept brand funding or ownership.

Jay Acunzo (Host and Creator of the do-not-dare-miss podcast, Unthinkable) is an outspoken advocate of the content marketing approach, with a firm belief that brands can, and will, create content every bit as good as the best publishers in the business.

However, he sees the lack of precedence scaring off the top talent who could make a brand purchased publisher succeed;

“Brands lack the historical track record of upholding and protecting editorial excellence, as well as the muscle memory of thinking about the audience first.

Those things create the kind of prestige necessary to attract topflight creative talent. And while exceptions exist (Starbucks, Red Bull, AmEx, Marriott), it’s still far from the rule that a brand creates standalone media properties where journalists can thrive.

Show me one brand who thinks audience-first, and I’ll show you a thousand writers who still won’t work there. There’s a huge stigma that needs to be removed.”

In fact, the freedom from commitments to raise advertising revenue should make for better quality, and more independant content.

The brand can worry about selling products and services to fund the publication. The editorial team can focus 100% of their efforts on building an engaged and trusting audience, which all adds up to a tantalising proposition... 

Why build an audience, when you can just buy one?

When you take into account the costs associated with building an audience of the same size, the buy might end up cheaper. If you, your team, and our industry can start pulling this off, we can all spend less money advertising and more time making content that our customers actually want.

In his Sorry For Marketing article, Jay pens an explanatory media release for any daring brand willing to take the plunge on this strategy.

If you want to buy a publisher for their audience, and keep their editorial staff, this is what you need to say to keep them:

“We want to enable even more creative freedom. Publishers often feel friction between editorial quality and page views, in addition to inserting ads into the experience in ways that feel forced.

We will face none of those problems, as our model is not to sell ads. It is now paramount that we allow this staff of creatives to do what they do best, without our goals of selling product getting in the way, while providing the resources and independence they need to continue building something the world loves.”

We gorillas are pretty excited by the opportunity here. Marketers, journalists, editors and publishers should be too.

Ad agencies, and bot fraud peddlers maybe not so much.

Put this concept out on the table. Kick it around. Run the numbers.

It could be a cheaper, faster way to advertising-free success.

The long term solution to insure against ad-fraud

Firstly, make sure subscriber acquisition and retention figures are central to your marketing ROI measurements.

Secondly, consider purchasing a publisher’s established audience, and all of the business assets that come along with the package deal.

Let’s stop taking the lazy way out.

Blindly paying for reach is not smart marketing.

It’s not about counting impressions - it’s about making one.

 

(If you want to learn more about the problem with online advertising - there's a lot more to know. We prepared a detailed, 50 page downloadable report, split into seven manageable chunks, to explain how bot fraud is compromising your online advertising dollars, and what you should do to fix it. Just click on that big old button below to download your free report now.)

 

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Author

James Dillon

James tells stories for a living. Sometimes they are true. Always they are crafted to help brands delight, educate and funny-bone-tickle their audiences into coming back for more. He’s super passionate (read: obsessive) about ecommerce content marketing. James is dedicated to teaching ecommerce brands how to create their own repeat-customer-generating media empire. Keep an eye out for his online ramblings - you can expect a generous helping of lightbulb moments and cheeky guffaws.
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