Crystal Ball Gazing (2009-2014)
December 13, 2009 at 1:48 pm
What better time to cast our minds into the future than coming to the end of the year? Forrester’s US Interactive Marketing Forecast, 2009 – 2014 makes an interesting read. The US has always been a couple of years ahead of Ireland in online terms. That gap had been narrowing and anecdotal reports from Google Ireland were that the gap had narrowed to about 2 years. Recent economic conditions and the resulting freeze on investing in new and emerging technologies here has seen the gap widen again to about 3 years. However, with the focus on the “Smart Economy” who knows what changes that will bring?
204 US marketers were surveyed in March 2009 by market research company, Forrester, about their marketing plans from now until 2014. I’ve taken the time out to read and absorb the report. Here is my summary with own opinions included (of course!):
Wholesale shift in budget away from traditional to interactive
60% of marketing budgets are moving away from traditional advertising. Kimberly Clark Worldwide Huggies campaign bypassed TV completely to invest in digital media where new moms hang out. Expect to see more of this kind of thing.
What’s been hit?
What To Look Out For
Interactive marketing spend will reach $53 billion by 2014. Where’s this money going to be invested?
Search Dominates Spend
Accounts for 59% of online budgets. It’s expected to grow at 15% per annum to $32billion by 2014. It makes sense – 85% of online consumers search from their desktops at least once a week. If you’re marketing online, search is the first port of call for being found by a wide audience. Mobile search expected to increase – 11% have searched from their mobiles in the first three months of 2009 alone. The search market is growing through expanded keyword search strings. E-Consultancy noted in its Best Practice Guide for Search that as we become more used to search, we are searching using more and more keywords. So the supply of search is also growing.
Email Marketing Continues Healthy Growth
97% use or plan to use email marketing this year and this will continue to grow. Email is enjoying something of a renaissance as marketers grow lists with the promise of ‘green marketing’, as money is shifted away from direct marketing to email marketing, and as effectiveness is improved with linkages to other channels such as user generated ratings and reviews. Sovereign Bank in the US increased its email marketing spend from 10-15% in 2009, and completely skipped the DM piece in its student campaign.
Social Media Fixed Firmly in the Mix
Poster child social media shows the steepest growth of any channel (but remember it’s coming from a lower base) to 34%. Forecast spend on integrated campaigns and agency fees will top $3 billion by 2014. Social media is growing into an established part of the marketing mix – 64% of marketers already build social media apps and another 22% will by the end of 2009. When 42% of online adults and 55% of online youth want to engage with their favourite brands through social media applications, the demand is clearly there. It’s still early days yet for social media in terms of types, tools, metrics and benchmarks. Expect to see more engagement in the coming years and not just reach. Forrester foresees that portable identities will enable users to move their social profiles from site to site. So anyone engaged in that space is on to a winner.
Display Ads – Rich and PPC
Recession minded marketers prefer pay-per-click buy over impression-based ones (58% of budgets). Expect this trend to continue even after recession. But we’re still loving our rich media formats which are currently accounting for one-third of budgets; expect this to grow to 45% by 2014. (That means more of those annoying eircom ads where the ‘actors’ wave at us and annoyingly distract us as we browse).
Online Video
Pre-roll, mid-roll and post-roll are sold in exactly the same way, so you’d expect the old television-centric agencies to shift their focus into online video anytime soon. With awareness and recall of nearly 300% being achieved by P&G for Charmin pre-roll ads, it would be strange not to see trad agencies dive into this space. The 2007 Forrester forecast predicted widespread adoption of online video and mobile marketing by the end of 2009. This hasn’t yet happened – largely due to the recession and resource-constrained marketers not wishing to trial untested media. But Forrester (2009) predict that online video will kick off big style in mid 2010 following by mobile marketing in early 2011 as marketers emerge from recession. Does that mean that the gap will widen ever more between US and Ireland if they come out of recession first and we lag even further due to the endemic nature our woes?
Mobile Marketing
Reminds me of Smithfield in Dublin – we’re still waiting for it to happen! Mobile marketing is one of the most anticipated, least adopted channels. Why? Complexity around metrics, marketers and carrier relationships, plus limited use of data by consumers have all put the skids on mobile to date and stifled adoption. When the recession is over and marketers are spending on newer channels again, Forrester expect mobile to take off.
Why? There will be increased use of data as devices improve, apps proliferate, and mobile operator competition brings data prices down. We’ll see more strategic apps and less of the gimicks that tend to crowd out the app store currently.
Forrester say that mobile maturity will see some efforts being made at introducing standards – but I don’t think so. We’ve had email for close to 15 years and are nowhere near standards amongst email clients (which is why I support the Email Standards Project and you should too!) – I don’t see the disparate mobile providers and handset manufacturers working together on standards as easily as Forrester expect. But I’d be happy to be wrong!
So What Does It All Mean For Us?
The main lessons I’m taking from this is to continue as we are. First step to promoting your business online is to invest in search and make sure that your business can be found by thge 85% who use search to look for your product. The report refers to US marketers investing more heavily in SEO as PPC gets expensive. I’ve been banging on this mantra for quite some time now. While PPC is great in the short-term, the click costs can be quite high – when you add up what you’re paying Google over a year or two, it makes more economic sense to invest in a listing on the left hand side.
Email marketing continues to bring great results. Whether it’s driving traffic to your site for a sale or promotion, or simply brand-building, keeping your business in front of their minds – it works! It’s been the most regular producing, low risk retention strategy for years. It makes sense as majority of people have emails. Emails are not dying out as had been predicted. In fact, we should soon be seeing the growth of the Social Inbox - fusing the best parts of our inbox as we now know it with control and immediacy of social media apps. Long live email marketing!
Early days for social media – my perception of it in Ireland is that 2009 was indeed a year in which many jumped on the bandwagon – or at least familiarised themselves enough to be ready to jump in 2010. But the message I’m sending time and time again is that social media is for life, not just for Christmas. We’ve all been to the seminars on the amazing results that can be achieved, some of us may understand that the creative costs aren’t that high compared to other media. But it’s the ongoing resourcing and dedicating of time to engage with the people we’ve tried so hard to reach – that’s the bit that costs money and that, sadly, is missing in many cases. Don’t just take my word for it. Seth Godin puts it like this:
Dating is a process. So is losing weight, being a public company and building a brand.
On the other hand, putting up a trade show booth is an event. So are going public and having surgery.
Events are easier to manage, pay for and get excited about. Processes build results for the long haul.
Tags: email marketing trends 2010, internet marketing trends 2010, social media trends 2010
Why are they advertising then?
April 27, 2007 at 8:07 am
In research mode for a bed, it seems that all the activity on Google is on the pay per click side. Organic listings throw up news articles on hospital beds, dog and cat beds, books on beds. . .
On the pay per click side, one of the top 3 advertisers is bedsdirect.com yet they don’t deliver beds to Ireland. Why would they bother advertising on Google Adwords where they’ve obviously geographically targeted their search to Ireland when they can’t take orders from here? Is it to tempt Irish customers to buy a bed online, have it delivered to some relative’s address in the UK and then drive over on the boat and pick it up?
I don’t think so!
But one thing’s for sure – they obviously have plenty of money to burn. If they can afford to run a national pay per click campaign in a country in which they can’t do business. You could help them use up their budget by clicking on their ad! Search for “beds” on Google and you’ll see them around the top on the right. Go on. Click it. Beddirect.com – how not to advertise online!
