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The Shift to Digital: Digital Media Is Overtaking TV. What Does That Mean for Marketers?

March 29, 2016 by Aimee


As media fragmentation continues, TV is losing its stronghold on advertising budgets. According to the New York Times, digital media "will continue its meteoric rise. Digital ad spending will grow 17.2 percent this year, to nearly $160 billion, and 13.5 percent in 2016, and is expected to overtake TV as the biggest advertising category by the end of 2017, the forecast says.”

Why Digital is Tipping the Scales

This shift is due largely to decline of linear television viewing -- a direct result of increasing, new opportunities to engage with consumers on a one-to-one basis across screens. These one-to-one opportunities are the fruits of data-driven programmatic advertising, which allows brands to use data from diverse sources to target and engage consumers in real-time. This means that brands can reach their customers in the digital world with personalized messages at scale for the first time ever. The result is highly targeted, relevant advertising that yield offers that are useful - or at least entertaining - to the customers who see them. Beyond that, digital video advertising is far more economical, offering dramatically lower costs than traditional TV, and results are measurable. With digital video, advertisers can calculate a true return on their advertising investment, something that’s never truly been possible with TV.  It’s that “right message, right time, right place” dream that is finally becoming reality.

The one-to-one opportunity is best exemplified in social and mobile, particularly because these are highly personal channels. In social media, brands have not only the opportunity to find customers in the places where they spend the most time online, but also to engage with them in really meaningful ways. Social gives brands a means of actually building a relationship with the customer. In mobile, everything is “just-in-(real)time,” giving brands the advantage of not only engaging consumers at the right time, but also in the right place, thanks to geo-targeting. With mobile, the content that brands surface to prospective customers can be hyper-relevant, such as a Starbucks coupon as they’re walking through the mall, or a reminder to purchase laundry detergent as they enter a supermarket.

Traditional Media Still Matters - For Now

Keep in mind that digital channels, while they are gaining a larger share of the media budget, will not completely displace television. While traditional TV is giving way to on-demand video sources like Netflix and YouTube, TV is still very important and very valuable. Millions will continue to be spent on Super Bowl spots and advertising for events like The Oscars or the American Idol finale. That’s not going away any time soon. Neither is the value of radio advertising during the morning and afternoon drive. What’s going to change is accountability.

Even as the industry pours hundreds of millions into the upfronts, a major shift is occurring. With digital media, advertisers and marketers can determine a true ROI for every dollar spent. As mentioned previously, this has not always been possible with traditional channels. However, with digital there is data to prove how successful (or not) each campaign has been. TV and radio will have to become more accountable. In the months and years ahead, it will be incumbent on TV media professionals to provide measurable ROI reporting and audience data that is comparable to the level provided by digital.

Digital Matters More Right Now

Over the next year, digital will grow at an accelerated pace. Why? Primarily because the 2016 Presidential election is already proving to be the most hyped political event in US history. The candidate’s campaigns have likely already bought up a tremendous amount of inventory heading into the fall, allowing less air time for brand advertisers. With a fear of being shut out of traditional media at peak hours, brands will turn to digital for the reach and scale they need, and to rise above the Presidential campaign clutter. Brands that have been lagging in their adoption of digital channels (there are still a few) have likely already started playing catchup, partnering with digital agencies and technology companies to prepare for Q3 and Q4. It’s going to be an exciting time for the digital advertising industry.

Are your clients ready to invest more in digital to achieve scale? Contact us today to discuss how we can partner to help your clients achieve their goals. Even if your clients are smaller than Fortune 500, we can offer all the tools “the big guys” use, along with one the smartest, most strategic teams in the business.

Filed Under: digital advertising, Blog, programmatic advertising, digitalmedia, Programmatic

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