As tests, the budgets were small and the level of forgiveness was high. Marketers viewed the money spent in digital as something to play with, and any wins were considered bonus to the core objectives and could fuel future growth.
As those wins piled up, so have the expectations. Digital is no longer considered innovative, nor a test -- it is considered integral. Digital is now part of a core marketing strategy, and with that level of expectations comes a different level of acceptance as well as forgiveness for when things don’t work the way you want them to. Is it possible that digital media -- as a tactical component of a marketer’s toolbox -- is simply too big to fail?
Digital budgets have increased because the audience often spends the majority of its time on digital media, and marketers recognize this fact. As marketers reallocate more of their budgets to digital, the cost of mistakes becomes higher. If you miss your goals by 10% against a 5% spend allocation, the impact is far less than missing the target cost per action 8% when the budget is 50% of the allocation.
As a result, there’s far more due diligence being applied to the ways marketing dollars are being spent, and fewer risks are being taken. Dollars are becoming more and more focused on the short list of proven performers, such as Google, Facebook and a few others. Start-ups are having a more difficult time breaking into the mainstream because scale, reach, accuracy and quality are defining factors for how marketers are viewing their partners. This applies in media as well as in creative decisions: You work with the companies you trust and those with a credible track record for being an effective partner.
For marketers, the question remains: How do I balance the need to meet objectives with the desire to innovate, and be given forgiveness for those areas of "testing” that have more risk associated with them?
The role of any good marketer is to build a strategy that meets objectives while planning for the future. You should always be assuming that what works today won’t work tomorrow. That’s been a driving force in digital media planning since 1994, but that first 22 years was very much focused on a high potential growth curve.
In 2016, we’re witnessing the business approach a level of maturity previously only dreamed of, but not realized to date. Having more money spent in digital than in TV provides a tipping point that signifies a level of maturation. It also signals that TV is about to undergo a massive amount of change. Much of the “testing” in digital might actually be applied to the next stage of TV -- either in terms of programmatic and addressable TV, or the ways TV supports social, search and other formats of digital media.
For innovation to continue, marketers have to be willing to allocate a portion of their dollars to testing and recognize that testing requires forgiveness because not all tests are going to work.
When you work with your agency, you have to empower and trust them to take some risks. As some companies say, it’s about “failing fast” and/or “recovering quickly.” These statements are now clichés that mean accepting that something didn’t work, learning from it, and applying it to your next test. Building upon earlier tests is always the way you come to a solution with a higher likelihood for success.
The idea that digital is no longer being considered innovative is a shift in perception that really affects how you do your job. You need to know that the stakes -- and expectations -- are higher. If we don’t recognize this stage of maturity in the business, we set ourselves up to rest on our laurels and not think of the future.
Are you still trying to be innovative -- or are you afraid to fail?