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Managing Marketing: Why Digital Marketing Has Not Lived Up To The Promise

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Managing Marketing is a podcast hosted by TrinityP3 Founder and Global CEO, Darren Woolley. Each podcast is a conversation with a thought-leader, professional or practitioner of marketing and communications on the issues, insights and opportunities in the marketing management category. Ideal for marketers, advertisers, media and commercial communications professionals.

Ilona Evans is a Senior Digital Consultant at TrinityP3 and she discusses the role of digital media and digital marketing and the issues and challenges it presents for marketers and advertisers. They look at the promise of digital marketing and share why much of the benefits of digital marketing have failed to materialise.

You can listen to the podcast here:

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Transcription:

Darren:

Welcome to Managing Marketing and today I’m welcoming Ilona Evans to TrinityP3. Ilona is joining us as a senior digital consultant here at TrinityP3, welcome.

Ilona:

Thank you very much.

Darren:

Digital’s such an interesting area because it’s probably the single biggest disruption that’s happened to marketing in the last 100 years isn’t it?

Ilona:

Yes, absolutely. It has certainly disrupted the way that we can talk to consumers and interact with consumers.

Darren:

For you personally when did it really become an issue, an idea or a passion that you wanted to be involved in, or did you just fall into it?

Ilona:

From a career perspective I fell into it. It became part of one of my first roles with Toyota and then I became increasingly interested in it because it is just changing all the time. It’s not like knowing something inside out; it’s always being open. Something we’re working on now; a year later won’t be the new thing you’re working on anymore.

Darren:

It is constantly changing. There’s always some new innovation, opportunity or idea. But there’s also a danger with that isn’t there; the new shiny thing is probably one of the biggest things about the technology space isn’t it?

Ilona:

In all media there’s the new shiny thing but in digital more than any other. Sometimes it is new but a lot of times it’s only a slight change and it’s just been repackaged. So, it might be an additional layer of targeting within programmatic and sold as this completely new way you can reach people.

But then if you strip that back it’s still actually essentially buying into the same group of sites, it’s just from a different platform and maybe it’s got slightly different targeting overlaid with it so it’s always a matter of digging deeply to explore whether or not it is new.

Darren:

Do you think it is also the natural complexity of technology? You’ve got your own language that goes with technology and so to be able to convince people that this is a new innovation or revolutionary is a little bit easier because you can use a language that a lot of people really struggle with.

Ilona:

Absolutely. One reason why digital really appealed to me is that it’s always changing. You have to accept that if you haven’t heard of something or it is new then ask about it and explore. I think a lot of people don’t allow themselves to do that and through their lack of knowledge are bamboozled and get carried away with the shiny new thing.

Often you just need to ask the most basic questions and you don’t need to know that much about digital to get to the heart of what the technology actually is and whether it can deliver on what your business objectives are.

Darren:

I think it’s really important just to have that constant curiosity to ask the questions that everyone in the room seem to avoid, which is, so what does this actually do? That could be a really good starting point. Or how is this going to make things better for me?

Ilona:

Absolutely. I think some of the best meetings I’ve been in with clients, we’ve had the CEO or someone senior who is not normally in the week to week WIPS and they just lay it on the table; ‘Why is this not delivering?’ Just those back to basics questions sometimes steer the conversation where it needs to go.

Darren:

I think we’ve seen a few examples of where people have lost sight of the whole purpose of technology and probably one of the highest profile (and one you’ve worked in) is the concept of digital media—owned, earned, and paid. The paid seems to be growing and growing at the expense of earned and owned, wouldn’t you say?

Ilona:

Yes, certainly owned assets are only in recent years getting the attention that they deserve. Previously they often weren’t part of the planning conversations and now almost as the conversations about data have increased people are realising what brands own themselves, whether it’s data or their own websites, storefronts and all sorts of other owned assets .

People are now starting to apply the same marketing rigour to these owned assets as what is applied to the paid media.

Darren:

Maybe it’s because often the other components will fall outside of marketing. Ecommerce is often run by either the IT department or operations and not the marketing department. Do you think that’s possibly why there seems to be a marketing focus on paid digital media rather than all digital channels?

Ilona:

Yes, I think it can be because responsibility for owned assets can fall into different departments. As the different types of paid media have grown; for example, work that’s done with influencers and smaller organisations it’s made people aware of the value that’s put on all owned assets such as your social platforms, own websites, and own database. That same rigour is increasingly applied to a client’s own assets and treated the same way from a planning perspective.

Darren:

One of the things I remember from the early days; Amazon was a brand that wasn’t overly creative but they really got the commerce right by using the data they collected about me to make offerings and suggestions that were really quite compelling. Do you remember the first time you used Amazon or is there an ecommerce platform that stood out for you?

Ilona:

Yes, Amazon certainly in terms of all the suggested and related content that would come up. And they’ve been doing that for a long time when you compare that to the conversations that are happening around a lot of other brands and other ecommerce platforms.

Darren:

People talk about Facebook and how much they know about you but I think if you’ve been an Amazon customer for five years they’d know a lot more about you because Facebook really only has information about what you like and the things you follow and things like that.

But Amazon actually has information about the things you’ve paid for with hard-earned cash. Ultimately, that’s getting closer and closer to the Google moment of truth when you buy something.

Ilona:

Yes, it’s not just the search queries; it’s going through to the actual transaction.

Darren:

The reason I raise that is that I’m hearing more and more and reading especially in the Trade press that marketers are really starting to question whether digital is really delivering everything it promised.

And the promise was to be able to get closer to customers, have conversations with them, and be able to personalise those interactions and yet a lot of the problems we see in the digital space are because it’s been largely sold or used as a mass audience reach rather than an intimate audience reach. Is that how you feel?

Ilona:

Well, that’s the beauty and the challenge of digital that it can serve so many different roles. It certainly can have a role as a mass media but in some ways that’s the easiest to implement but not using digital to its full capabilities.

There is a lot of backend work needed and changes in processes and ways of doing things to really get digital to work to its full extent. For a long time now, you’ve been able to have dynamic and creative that’s pulling in variables and what people have been searching for and there are certainly some advertisers doing it really well.

But there are a lot of advertisers who haven’t tested more tailored communication yet for a number of reasons be that lack of a process, struggles with the the data coming from a different team internally or the need for multiple agencies to work together with the media partners to get something off the ground. A lot of those promises haven’t been delivered because they’ve gone into the too hard basket or haven’t fit campaign timings.

Darren:

So, what you’re saying is there is a continuum; at one end a handful or more of companies that have been able to leverage all of the promises of the digital channels or space and then there are a lot more companies that have really struggled, either because they don’t have customer data or they don’t have infrastructure or a process that allows them to do it.

Ilona:

Yes, marketers, agencies, everyone is very time poor and a lot of digital does take more time to set it up properly and run in terms of the reporting and optimisation. These fundamentals however, are needed to allow you to do that one to one targeting, which ideally should be part of an always-on campaign.

More tailored activity doesn’t always fit exactly within campaign bursts; for example, if a client’s working to big launch campaigns or bursts of activity and it wasn’t seen as essential to get it off the ground for that campaign it gets pushed down the road.

There are a lot of opportunities for technologies that have been around for a while and can now be optimised and performance increased with more data and targeting abilities now available.

Darren:

We get asked all the time, who’s doing it well? And you find yourself often falling back on the disruptors. Uber disrupted the taxi business but they didn’t have a legacy taxi business that they had to transform. They just came in with an app and created a whole new way.

Was it the technology or was it the fact that the technology was delivering on a customer need that clearly got traction?

Ilona:

I guess it was a need. It’s hard to know which came first. It’s not until you’ve experienced it that you realise how convenient that is.

Darren:

It’s the old Henry Ford question: if you’d asked people what they wanted they would have said faster horses and they didn’t know they wanted a car. Did we know we wanted Uber, Airbnb, what else is there?

Ilona:

Mobile, which has obviously been around for a while now but smartphones. Everyone was talking about the year of the mobile and it was going to change things and it has. It really is now the one device that people are using for much of their day to day lives.

Darren:

It’s almost 20 years since the term digital marketing was first bandied around and yet we’re still talking about digital marketing as if it’s somehow separate from marketing.

Ilona:

Yes, we are. You can’t do marketing without doing digital marketing. If a company is not doing digital there would certainly be opportunities that they should be. It is just integral to what marketing is and you can’t develop a marketing plan without an understanding that a big part of the way you have to interact with people is through digital channels.

Darren:

So, when you first started working with digital you would have been in the digital team weren’t you?

Ilona:

I was in the online team.

Darren:

That’s right, online marketing and then it became digital. Before that it was called interactive media because they could interact through it. The different iterations are interesting. And yet there are still companies that have a separate digital team. They have a team that just works on digital—I wonder what everyone else is doing.

Ilona:

It is a hard one because the nature of digital media and digital marketing more broadly does require, from an implementation and technical point of view, a certain skill set. There are a lot of companies out there trying multiple models and it does evolve and change according to what the marketing team requirements are at that point.

To find the right mix it’s a matter of up-skilling the whole marketing team and the media and account teams at the agency level to be knowledgeable about digital but then also recognising where there is a place for some specialised digital roles.

Darren:

And especially getting marketers to think it really is marketing; it just happens to be through digital channels. That’s what technology has provided; more and broader ways of being able to engage.

Ilona:

Absolutely and engage in ways that are always on. It doesn’t stop and a lot of it is two-way communication.

Darren:

You mentioned media before. Digital media is the big growing area of client investment. Every year, no matter what happens in digital media, there seems to be more and more money put into digital.

Ilona:

Yes, it is. It’s certainly not a perfect world but it’s that much more accountable and trackable and the fact you can optimise it gives clients a degree of confidence as well, being able to see those results and optimise along the way.

So, you’ve got the budget being pushed from that way. If it’s proving itself and delivering return on investment then that also is an easy case for more budget going into digital media.

Darren:

And yet there have been so many questions, especially in the last two or three years around the efficacy of display or paid social media because we’ve had all those issues around the murkiness of viewability and how to actually validate that there are real people seeing the advertising at the other end.

Why do you think it’s so popular when there has been such a cloud around whether you’re actually getting value for money?

Ilona:

As you say, that has certainly come up more in the last couple of years and they’re important conversations to have. Where a client has key objectives and the media can be tracked and optimised right through to the outcomes, certainly for e-commerce, in terms of whether digital is working or not working you can tell.

Darren:

Am I getting the clicks and is that turning into sales on my e-commerce site? Cause and effect—tick.

Ilona:

Yes, from a return on investment point of view there haven’t been as many questions asked. And then you’ve had, with digital media being that much cheaper from a cost per 1,000 point of view than some other media (even if some of it is not as effective),digital is still overall delivering comparable results.

Darren:

If your cost per 1,000 is 1/10th of what you’ve traditionally bought then 50% of it being seen by a bot or not seen at all doesn’t really matter because you’re still ahead on the cost.

Ilona:

And some of those conversations do come up. If you’re negotiating to buy viewable impressions versus ones that aren’t tracked.

Darren:

It’s a lot more expensive.

Ilona:

It’s a lot more expensive and sometimes the costs net out in the same place but the key thing is those conversations are happening with the clients so they’re educated and aware of what’s going on. I think it’s an issue in some cases when people, clients and even some of the media people and buyers are just not aware of it.

Darren:

I just remembered how for a while all the disruptors were put up there; Alibaba, Amazon (the disruptor of retail), Airbnb (the disruptor of hotels), and Uber ( the disruptor of the taxi business). There are two companies that never made that list and they’re absolutely the technology disruptors of the media industry: Google and Facebook.

They fundamentally changed the media space because up to that point you were only a media if you were either buying or creating content that you then sold, in advertising, for space. The attention of the audience that was either reading your newspaper articles, watching your TV programmes or listening to your radio.

Now, we’ve got these two big disruptors that are just collating, aggregating either consumer content or publishing content and selling the advertising through that.

Ilona:

Yes, they’ve changed the way media is bought, negotiated, and how value is measured. Suddenly you’ve gone from how other digital media was bought and negotiated, to these auction-based system where there isn’t that role of negotiation or added value. It helps make costings and pricings more transparent.

It’s also opened up a whole new world where clients can take it in-house if it makes sense to them to manage the buying of these platforms. It has certainly disrupted in a lot of ways including the whole data side; we do a get a certain amount of data but given the amount of dollars that’s going into these platforms its important to note that a lot of their world is still a walled garden.

Darren:

But it’s interesting that we haven’t ever highlighted them as disruptors. You’ve seen that IBM Powerpoint presentation (I think IBM put it together) that talked about industry disruption. But I’ve never seen a version of it that says Facebook and Google have been major disruptors of a particular industry and yet they have fundamentally changed it.

No other media could come out and admit that almost 50% of their audience is fake and that they’ve cleaned that up and not suffer a major hit. They haven’t suffered a major hit. If anything, they’re still getting an increased share of media money.

Ilona:

It’s their sheer size that’s allowed them to get away with it. If they were smaller I think it would be a different story.

Darren:

And the other thing they disrupted was the idea of offering global media because up to that point almost everything was country-based and the TV stations, newspapers, and radio stations were only in a particular market.

It must be terrifying for politicians because one of the reasons media was always owned and very much controlled in a particular market was so the politicians could have some sort of control over it. But now they’ve got no control over this global media platform.

Ilona:

Yes, it’s certainly allowing people’s stories to get out there in ways that have never happened before.

Darren:

And yet, in some ways, it completely plays to the whole idea of the internet, which is to democratise media, to allow people to have their say without being a major media player. So, I can see the great conundrum because on the one level they’ve played perfectly to the needs of the internet but on the other they’ve completely disrupted what was the traditional media and advertising model.

Ilona:

Absolutely and created a more level playing field for advertisers. No matter how small you are you can still work with those two platforms. You’re not disadvantaged in terms of what rates you’re able to negotiate or placements you’re able to get.

Darren:

You could be the corner shop and have the same access to the same medium, which is virtually unavailable to you in most other media.

What about this idea of measuring value? In the work you’ve done with clients what’s the approach marketers should be taking when they’re looking at the value of digital?

Ilona:

It has very much changed with Facebook and Google from a media value perspective because previously your agency would measure the value they’ve been able to negotiate off rate cards, the added value they’ve been able to negotiate (that’s where the value equation would come in). Now when you have these more even playing fields where it’s an auction based system there is not a lot of opportunity to negotiate a lower rate.

The benefit is then that the value is very much tied back to performance. Either the value delivered is year on year performance. A new agency has come on board and taken on the search activity and they want to demonstrate much better results—well there’s value there, in measuring that right through to the client’s performance metrics in terms of the ROI.

It’s almost a different definition of value because now there is less and less digital media where you can say we negotiated X% off the rate card and we were able to get this many Home page takeovers. That still exists in terms of direct media buys but it’s becoming a smaller component.

Darren:

And it’s not really value is it, it’s price. We’re buying units at a price rather than value. Our point was about measuring performance because ultimately your media investment should be about driving some sort of performance metric.

Ilona:

Yes. So, in a way it’s just brought the whole conversation back to is it driving value and business sales?

Darren:

Which can be a challenge for some organisations because if you’ve got e-commerce you absolutely know if your online digital marketing and advertising is driving traffic. But if you’re a traditional consumer goods company selling through the retailer it would be impossible to be able to close that loop.

Ilona:

I think when you talked about over-promise in digital it’s that idea that overall digital is sold as totally trackable, accountable, and measurable and yes, it is but it depends a lot on what your actual business objectives are as to how far that measurement can be tracked.

And if you do measure it, still sometimes, depending on budget, model of relationship between them, you might do brand studies to see if there is a lift in consumer intent to purchase but it can’t always be measurable to the extent that you can optimise the media or buy media to that metric.

Darren:

Google, naturally, pushed last-click attribution as the only true measure because it happened or it didn’t. And then people started recommending attribution modelling that would take into account all the other things that were going on. But from what I’ve heard there’s a bit of a pushback—attribution is smoke and mirrors. What do you think? Have you worked with attribution modelling?

Ilona:

I think it’s interesting to look at different models on the same data and understand the planning, types of thinking, and the channels. But most of them are only measuring digital channels. When you bring in the offline channels as well and have offline sales they are different models but it’s not an exact science. And I think that’s what digital is still sold as: the 100% accountable medium.

Darren:

I can’t remember who said it but ‘all models are useful; most models are flawed. Attribution models can be useful but you’ve got to accept the fact that there are going to be flaws in them and if you accept the flaws then you just use them knowing what those flaws are.

Ilona:

And make sure you get insights and learnings out of it that you can actually apply.

Darren:

But you can see why marketers get a bit confused because there’ll be a group of people over here going ‘go for last-click attribution’ and a group over here going ‘no, do attribution modelling’. Where is the answer? How do I measure performance? And then the agency will have a vested interest usually because they’ll be trying to push what’s either the easiest to do or appears to give the best result.

Ilona:

It’s key that the agencies are working together and are clear on what models are being used because there is a lot of confusion. You might have one agency and it’s more in their interests to look at post-impression results driving conversion versus last-click so it’s a matter of having a conversation around it and working out what makes most sense for that client and that industry.

And I think if you agree on a model that’s used for ongoing reporting but at certain key points for planning it’s worth delving in and looking and playing around with it and seeing if it’s telling you a different story but for your week in week out just being consistent with what you’re using.

Darren:

What you just said reminded me that last year the A&A in America said it was the year of transparency. Most people are pointing the finger about transparency at the agencies but what’s your concept of transparency? What are we trying to achieve by being more transparent?

Ilona:

We are trying to achieve trust between agencies and clients, not having any biases in terms of where media is booked to plan based on whether there are non-transparent profit margins in one or the other. In an ideal world working towards an open, level playing field over which media and marketing is going to deliver the best outcome for a particular client’s objectives.

Darren:

There is another school of thought that transparency works with the clients as well. The clients need to be transparent in the data they provide to agencies and media owners need to be transparent in the behind the scenes results and data that they produce.

It’s interesting that we use this term transparency when what we’re trying to achieve is for people to feel more informed. No one wants to feel like they’ve had the wool pulled over their eyes and yet a lot of digital, whether it’s the language of it, or the complexity and constant changing ways of operating seems to make people feel completely wrong-footed.

Ilona:

When programmatic tried to make it simpler—the costing models even though it wasn’t commission-based media it was sometimes easier from both the marketer’s and the client’s point of view to build that in so there was a 10% commission sitting there and it was actually the same fee structure as other digital media. As programmatic, for example, has matured people have realised that it does take more time to plan, optimise, and make it work properly.

The agency needs a bigger margin than potentially they do for other types of media. Some of it came from trying to make things easier because digital is so complicated.

Darren:

If you were planning a digital campaign manually now it would be next to impossible. There are so many inventory options and to even be able to compete on real-time trading without using technology or programmatic would be next to impossible. But as you say, you’ve still got to have the strategy, thinking, the paradigm or algorithm set up to optimise that in real time don’t you?

Ilona:

Certainly, in terms of what you’re trying to achieve upfront because there are a million different options out there in terms of how you would target.

Darren:

And the other area beyond that is brand safety. Almost a year ago there was a headline on the front of the Times newspaper in London about how some major brands had been seen to be supporting terrorism, pornography and all sorts of illegal activities and yet it amazes me that it’s called brand safety. Shouldn’t it be brand care? Shouldn’t we care about our brands more? What do you think about brand safety?

Ilona:

In all buys there is a certain level of brand safety applied but I think everyone needs to step up, take responsibility, and not just assume that it’s happening. For a particular brand work out what those additional sensitivities are as well. Just by being in the broader news categories, which is considered safe content for most people, you can still get placed next to very inappropriate content.

Having that conversation of where you’re happy to sit as a brand helps to really dig into what that brand is and what sort of content would be appropriate to sit next to it. Some people make the mistake that if you’re doing an audience buy you want to reach that audience no matter what they’re doing. But depending on what content people are consuming they’re in different mindsets but people can argue it both ways.

Darren:

Do I chase my customer into the territory they’re interested in? But part of that is also following the customer no matter what. If you then put the overlay of cheaper media you’re opening yourself up to having more mistakes because it’s often those dubious content providers that are going to be available to you at a lower cost because they’re just after revenue.

They know they’re not mass market because they’re not generally acceptable so you’ll often find in the bidding process they’ll be more cost effective. So, if you’re running at a lower cost you’re opening up the chance of getting into inappropriate content.

Ilona:

Absolutely, and if you’re comparing the cost of doing programmatic through different partners or providers obviously there are margin or cost differences but it’s getting to the bottom of it because a lot of it can be needing to chase that cheaper inventory. Some of it is o.k. but there are certainly questions there.

Darren:

I think the other thing marketers or advertisers were woken up to was how complex it is. Programmatic was introduced as a way to try and simplify the process but how complex the media supply chain actually is. You must have seen those charts that say ‘your dollar, only 30 cents goes to the publisher’ because there are all these people taking their cut along the way.

That’s always been a surprise for marketers and yet it worries me that people have been spending money in a supply chain when they’ve never really understood how it works.

Ilona:

Digital, comparing it to other channels, from a cost per 1,000 perspective for example, being that much cheaper hasn’t been questioned.

Darren:

Look at the cheap price I’m paying. But what’s it actually costing you?

Ilona:

Some marketers might look at it ‘well it’s delivering a strong return on investment so it’s working’ but transparency is important there and it could work even harder. There are a lot of people in those supply chains that do serve a purpose. If you’ve got additional layers of technology there, as long as they’re not duplicating themselves but if they’re in there because they are providing an additional targeting, tracking or validation layer or viewability they’ve got a role to play.

Often those things can be discussed because they do take away from the actual media dollars spent. If by tracking viewability or better targeting you’re getting better results they’re things that can be tested as well. If you take away some of those levels of targeting and technology you can test whether it gives stronger results.

Darren:

Test is it giving that return on investment or not.

Ilona:

It’s an education process of understanding who’s involved and ideally being transparent that it is a tech fee that’s being added and not a tech fee plus margin.

Darren:

What will you be bringing to the clients that work with TrinityP3? What do you think are the challenges that you’ll be looking forward to working on?

Ilona:

I’m looking forward to giving clients the confidence to use digital to its best advantage. There is so much that comes down to just sticking to your guns and understanding what your business objectives are and having digital work to achieve those and then working with all your partners to come up with that right mix of not always chasing the new thing but getting the basics and foundations right.

And alongside that testing and learning and evolving. The ratio between those things varies hugely depending on the industry and where that business is at.

Darren:

There is no best practice is there? There are some fundamental approaches but really the great opportunity is coming up with the right solution for the client’s particular needs.

Ilona:

And giving them the confidence that it is the right solution, the right mix of things, and having the tools and processes in place to manage that because it is complex. And digital isn’t being harnessed to its full extent from what I can see. Things fall down from trying to get data out of a company and applying it to media, getting all those different partners working together. I’m excited about unlocking some of the things that have been around for a while.

Darren:

But underutilised or mis-utilised.

Ilona:

Yes, plus bringing in what’s new and changing as well.

Darren:

We’re looking forward to it and great to have you onboard.

Ilona:

Thank you.

Darren:

Thank you.

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Darren is considered a thought leader on all aspects of marketing management. A Problem Solver, Negotiator, Founder & Global CEO of TrinityP3 - Marketing Management Consultants, founding member of the Marketing FIRST Forum and Author. He is also a Past-Chair of the Australian Marketing Institute, Ex-Medical Scientist and Ex-Creative Director. And in his spare time he sleeps. Darren's Bio Here Email: darren@trinityp3.com

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