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This is Digital Marketing
Chapter I - From Admen to Math-Men
This is digital marketing. From Admen to Math-men. Digital marketing has
been around for over 15 years but it seems to be getting really complicated.
Online exchanges, demand site platforms, real-time bidding, ad-optimization,
re-targeting… So what is Digital Marketing today? A powerful tool? A
mysterious beast? A total headache? A revolutionary medium?
Let’s try to simplify things: In the 1900’s, department store owner, John
Wanamaker, developed Advertising as we know it today and it worked, business
boomed and John got rich. But, there was a catch; as Wanamaker himself put it,
“half the money I spend on advertising is wasted. The trouble is, I don’t know
which half!”
Throughout the 20th Century marketers had no idea which 50% of their budget
was being wasted but, they didn’t care because Marketing worked. This was
the Golden Age of Madison Avenue Admen, when Creatives penned
multimillion dollar ideas on cocktail napkins and Media Planners plugged new
numbers into last year’s plan, re-jigging the mix of traditional media.
[01:11 – 02:04] Digital Marketing - Chapter II – The Digital Age Begins
Then, in the early 1990s the Digital Age began. Some people said the Internet
was just a fad but those same people are uploading photos of their pets to
social media sites as we speak.
The first online ads were banner ads and their widespread use began in 1994.
At first, people loved them. People clicked on them. E-commerce was a reality.
Marketers were excited and the Dot Com companies got big. Really big! But
just after the new millennium, the dot com bubble burst.
Almost overnight the market for banner ads collapsed. Too much ad inventory
was available compared to its value to marketers. For a couple of years, digital
advertising went through a lean period both in terms of innovation and profits.
No one was clicking on online ads. Digital marketing had entered the dark ages.
[02:04 – 02:56] Chapter III – Search
Then a new player appeared on the scene – a simple page with a logo, a search
box and two buttons. Other search engines already existed but Google’s search
engine was the only one that displayed short text ads related to the search
terms. Accuracy of Google’s search engine’s results allowed advertisers to
target their messages, bid for key words, pay per click and measure their ROI
more effectively. Search became the fuel for the reincarnation of Digital
Marketing.
New techniques, such as Search Optimization Marketing became ‘key’ for
marketers to reach audiences. Portals and directories such as AOL, MSN and
Yahoo that aggregated information were bypassed in favor of searching directly
for a given topic such as insurance or cell phones. Users started to create their
own content in web blogs.
[02:58] - [04:56] Chapter IV - The Long Tail
Web surfers became web searchers, web readers became web writers and for online
marketers this shift produced a phenomenon called The Long Tail. Although the internet giant
still attracted huge numbers of visitors, the power of Search meant that users could access
long-tail sites they might never have heard of before, creating a huge potential audience for
Advertisers.
By the mid-two-thousands, any traditional media buying agency could buy inventory on mainstream websites and there were big and bold new formats for online displays ads.
The Admen had to adapt a teeny-tiny bit but they were still in charge. But, how to reach these
thousands, or even millions, of long-tail sites? This is where traditional media buying agencies
hit a brick wall! In an industry based on rate-cards and personal sales relationships, they
simply had no way to access this ocean of inventory. So, to handle the long tail-sites, a new
breed of agency appeared on the scene – The Ad Network – and they’re still around today.
There are different breeds of ad networks but basically they all make online advertisers and
Website Publishers happy by buying and selling inventory on long tail sites or unsold inventory
on main-stream sites. The publishers of all those websites sell either some, or all, of their
inventory to ad networks and the ad networks act as brokers, reselling the inventory to ad
agencies and making a profit on the price difference and technology makes it all possible.
That brings us to today; because Search took a big slice of the digital advertising pie, its
effectiveness also created a new market for online Display advertising. The two forms
complement each other. Search has become a performance medium provoking ‘clicks’ and
‘action’, while Display achieves branding goals such as creating awareness and producing a
change in attitude.