Response Advisors Forum: Let’s Get Digital1 Jan, 2014 By: Thomas Haire Response
The members of the Response Advisory Board tangle over the challenges and opportunities presented by the growing power of digital direct response.
With digital and online marketing opportunities continuing to draw interest from marketers big and small — and the non-stop evolution of technology putting consumers more in control of the marketing they want to see — the direct response marketing space finds itself at a crossroads.
Those well schooled in the history of direct response television understand just how well positioned DRTV experts are in this age where metrics, measurement and ROI have become the crucial buzzwords for brand marketers. But how can they capitalize on this positioning by leading the way into the omni-channel marketing revolution?
“Somebody recently gave me a copy of ‘Business Models for Dummies’ and suggested everybody in the DRTV industry should read it,” says Richard Stacey, president and CEO of Toronto-based Northern Response Intl. Ltd. “Our industry is one of the few that operates so many different models simultaneously — all of which are either being disrupted or constantly evolving and experiencing massive change. Successful marketers today need to learn how to play two games simultaneously — traditional and digital — and be continuously innovating in all areas.”
That’s just one of the thoughts we gleaned when we turned to our Response Advisory Board of industry experts for our first quarterly edition of the 2014 Advisors’ Forum with a series of questions regarding the importance of digital direct response. Here’s what they had to say.
How is your company utilizing digital — online video, traditional Web, mobile, social — to complement traditional direct response mechanisms?
Doug Garnett, Atomic Direct: Everything we do has a digital component — from search to the video work being used by our clients across digital media. That said, none of the digital options delivers the power of DRTV. So traditional on-air DRTV remains the core of our campaigns with digital options sweetening the pie. If you will, 90-to-95 percent of impact comes from the on-air advertising and digital provides a 5-to-10 percent boost. In broad terms, search is most critical in that DRTV builds product demand that leads consumers to the Web, the phones or in-store. Then search — paid and unpaid — is part of the process that leads to closing sales via Web or in-store (and sometimes by phone).
Steve Heroux, Hampton Direct: With some of our campaigns, “the driving force” may be a better description than “complement.” With campaigns targeting younger audiences, we are now using digital technology (online marketing, E-mail, social, mobile, etc.) to drive the awareness needed to have a successful DRTV launch and retail launch. TV can become secondary as less and less of the targeted audience is watching TV.
Peter Koeppel, Koeppel Direct: Fundamentally, well-executed digital campaigns are, by definition, DR strategies with the goal of generating more conversions (i.e., leads, sales, phone calls, content downloads, etc.). Digital marketing supported by sophisticated analytics and measurement is the best complement to any offline marketing strategies. All studies point to the fact that Web searches are increasingly beginning from mobile devices, which means that brands and marketers need to think mobile first then expand from there. That is why responsive Web design is so important now, as opposed to the older strategies and costs associated with having multiple websites for desktop, smart phone, tablet, etc. With responsive design, you only have one site. One of the most popular strategies today — that impacts search, social and offline strategies — is content marketing, which can be leveraged to include almost any sales and marketing activity a company engages in. Content marketing is about consistently creating and distributing quality branded content that engages your customers at all stages of the buying cycle, thereby building trust and generating more leads/sales. Content marketing has a positive effect on both on-page and off-page search engine optimization (SEO) and is the driving force behind any sound social media marketing effort.
Fern Lee, THOR Associates: We tend to look at traditional Web as the foundation of our online campaigns. The first, and most important, task is creating an engaging website or landing page that gets the user to take action. For our clients, that means generating sales. Once we have the site locked down, then we start looking at other ways to drive incremental traffic. Without a site that can generate a strong conversion rate and high average ticket, you're wasting online and offline media spend. Video has been a part of our online campaigns for years. This is a great way to show content that didn't make the DRTV creative but still includes valuable information for the consumers. It’s also an effective channel to distribute new content that was created after the initial TV spot. Social media often ties in with our video channels since its one of the easiest ways to share information with our customer. In recent years, we've seen the number of customers who initially access our clients’ websites via mobile device steadily climb. In some cases we're seeing 30-to-40 percent of the visitors generated from a traditional DRTV spot are on a mobile device. This change in the viewer’s habits prompted our team to insure that our websites are either "responsive," where they dynamically adapt to the user's screen size, or the mobile traffic is redirected to a dedicated mobile site.
Mike Medico, E+M Advertising: Our agency is using various forms of digital as an adjunct campaign to the TV campaign. We believe that the digital component is effective as a branding tool but has yet to mature in terms of it being used to capture response at allowable.
Greg Sarnow, Allegro Response Teleservices: We are advising all of our clients to look at their campaigns as multi-channel marketing campaigns — not DRTV campaigns. The Web — especially online video, YouTube, Amazon and survey sites — is a common place for people to go before buying a product. If these areas don’t sing the praises of your product, sales will not be as robust as they could be. The Web is giving direct-to-consumer marketers the opportunity to add a component of branding to their direct response. When marketing on the Web through pay-per-click (PPC), SEO and — especially — video SEO, campaigns improve results and get a longer tail.
Richard Stacey, Northern Response Intl. Ltd.: I recently read the Fusion Marketing Bible by Lon Safko, which I recommend. Our company follows a similar fusion model in blending traditional, digital and social media to maximize our marketing. We start with a unique strategy for each product and then use all the advertising tools aligned and working in a coordinated manner to drive awareness — search, research and purchase.
Robert Yallen, InterMedia Group of Companies: As media consumption has evolved, so have our media strategies. Today, media is consumed across multiple screens, in multiple locations at times most convenient to the user. We take an omni-channel approach to our media strategies by building a specific media mix around the media consumption habits of the target audience. This creates a unified, cross-channel marketing strategy that builds brand recognition, increases consideration and spurs consumer engagement. One clear benefit that these digital technologies provide is the ability for rapid A/B testing and deeper tracking capability. This process ultimately allows us to reduce testing cycles from weeks to days, and enables timelier campaign optimization.
Which facet of digital — online video, traditional Web marketing, mobile or social — is currently the strongest, and why?
Kevin Lyons, Opportunity Media/A&E Television Networks: Video is the strongest by far, as it allows advertisers to have a consistent message across all platforms. For direct response, video provides the ability to demonstrate a product and show how that product can fill a need for the consumer.
Garnett: Search, which I suppose one might call “traditional Web marketing,” is most powerful. While it’s easy to post online video or submit it to ad networks, the reality is that driving high viewership of online video is exceptionally difficult. As a result, it’s a low-impact medium. Social and mobile may be shiny baubles — but they are not yet effective marketing mediums. Reading the studies, one finds that the biggest mobile interaction of consumers is not with directly mobile options, but rather when consumers access traditional websites or YouTube from their mobile devices. There is serious doubt about whether “mobile” will ever become a medium or stay simply the device the consumer uses to see traditional content.
Heroux: Traditional Web marketing continues to be where we allocate the largest digital media dollars for two reasons: it is where we have had our best ROI results and it’s easier to accurately read our ROI results.
Koeppel: Currently, the strongest digital strategy is when a brand engages a consumer by taking an integrated approach using paid media, organic search, content marketing, social media, E-mail, and multi-channel analytics. Trends for 2014 point to the fact that brands will continue to invest largely in paid search (Google Adwords, Bing, social media ads, etc.), E-mail marketing and content marketing — with video, eBooks, webinars, blogs, featured articles and images/infographics.
Lee: The answer really depends upon what the marketer’s initiatives are attempting to accomplish. If they are looking to generate leads — especially for a local business or franchise — then mobile is definitely going to be the winner. However, marketers who are looking to expand their database of customers should stick to traditional Web marketing (SEO, PPC, media buying, etc.). For the marketers that have risen above the rest and are truly a brand name, keeping their customers engaged via social media is extremely important.
Medico: We have been most successful using online video. This seems logical given that some of the respondents were driven to the video via TV.
Sarnow: I don’t think this is about “strongest” as it is the “net effect” (no pun intended) of utilizing the Web to impact your entire sales and marketing effort. Reputation marketing, public relations and social media can be of great importance for campaigns with risk-free trial offers. Surveys, rating sites and PPC can increase sales. All these areas are very strong already. Each campaign’s use of these channels — and how wisely the marketer uses these channels — will determine which is strongest for that marketer.
Stacey: We use all methods of digital and social media, but which media is most effective really depends on the product, your objectives and the target market you are trying to reach. Some products are more suitable for viral videos and social media while others may primarily rely on search solutions, E-mail blasts and affiliate marketing. In many cases, we’re finding 40-to-70 percent of orders and being made from some sort of wireless device as opposed to a connected computer, so it is important that all our Web campaigns be mobile friendly.
Yallen: Though all of these facets have value, for DR marketers, video is the strongest complementary component. Digital video is no longer limited to just YouTube or Break anymore. Services such as Hulu and Netflix are providing users with content that previously was only available on TV. As a result, users’ media consumption habits have evolved — they are watching what they want, when they want, and doing so on multiple screens. Online video is no longer stuck in a computer monitor. Users can now jump between computers, smartphones, tablets and TV without skipping a beat. Users can start a season at lunch on their tablet, and finish it up at home on their TV. Video pre-roll advertising can certainly play a valuable role in delivering incremental awareness, and therefore in brand building. However, video — if utilized properly — has significant potential to contribute in lead and sale generation. By using longer-length pre-roll spots and incorporating a call-to-action that can be accessed across multiple, alternate response channels (including websites, texts and smartphones), advertisers can generate additional leads and sales. Video ads also offer excellent real-time tracking capabilities and are therefore an excellent testing medium.
Which facet of digital — online video, traditional Web marketing, mobile or social — will take the biggest step forward in 2014, and why?
Garnett: I don’t see this changing dramatically in 2014. Vast sums of venture spending are trying to sell the idea that they are “re-inventing” advertising. Bunkum. None of the so-called “advances” are yet showing much ad power – they merely nibble at the edges of far more powerful advertising. And some agencies are using the fear of missing out to drive agency profits selling these options. Remember the new media truth: it’s usually far more profitable for agencies than clients.
Heroux: I think the trend will continue to see more and more people using mobile as the preferred choice to connect with our campaigns. As PC and laptop sales continue to decline, consumers will continue to rely more and more heavily on their mobile devices.
Koeppel: The biggest step forward in 2014 will be when brands engage in data-driven integrated campaigns focused on driving more conversions via mobile channels. The biggest channels for these integrated campaigns will be paid search and display, E-mail marketing and content marketing. All of these channels working together and supported by multi-channel analytics will generate the best ROI.
Lee: Mobile is where we're seeing the biggest growth. Not only in users but also, more importantly, in the tracking and advertising platforms that give you the transparency to see what type of phone the viewer is using. Some of the metrics available to analyze include: carrier, device model, browser, operating system and many more. This granularity allows the advertiser the ability to split test the incoming traffic to ensure that the advertising channels and landing pages are optimized for the user.
Lyons: Mobile video has shown incredible growth and will continue to grow as its reach and measurement develop.
Medico: Mobile, given the advances in technology and the options available to consumers among phones, tablets, pads, etc., makes it very easy to access information anywhere, anytime.
Stacey: I think mobile wireless ordering from devices such as your iPad or a smartphone will take the biggest leap forward as consumer lifestyles and buying habits have shifted rapidly in recent years. Marketing campaigns that do not have Web programs that are easily accessed on a wireless device will find their results increasingly impaired.
Yallen: Mobile device penetration and functionality continue to increase, allowing for a much richer user experience. These advancements are also changing how users consume media on mobile devices. Tablets are beginning to replace desktops and laptops. As a result, these devices are being deployed when users have some time to dedicate to the device. Smartphones are rarely out of arm’s reach, and for many users, tend to be their initial point of media consumption on a daily basis. This trend provides new and innovative opportunities for marketers to connect with prospects, as users are more likely to be using their smartphones in public and while on the move. As marketers, we have to take usage habits into consideration and target users when they are engaged and most receptive to an advertiser’s messaging.
What are the three biggest challenges when incorporating digital elements into a DRTV-centric campaign?
Garnett: First, you have to accept that digital is a sweetening element — not the primary focus. Then, with this in mind, you need to focus on finding the digital work that complements what you’re doing elsewhere. Digital is not a standalone medium — it must be seen as a part of everything else you’re doing if you want it to deliver power.
Heroux: The ROI is rarely as good as the ROI for media dollars spent on TV. We are competing with so many Fortune 500 companies with large digital budgets that it sometimes makes it difficult for DRTV companies to compete. The same could be said for TV spending but since the digital space is so new and hot, these Fortune 500 companies are less concerned with the costs since they have the pressure of having to be in that space. Second, when it comes to areas like social or online video, it is certainly more difficult to see whether those marketing efforts are paying off. Finally, the constant changes and evolution mean that what you do today could be outdated next month.
Koeppel: These challenges can vary depending on the size and complexities of the campaign channels, but, in general, tracking TV responses online, monitoring your paid search budgets while running a DRTV campaign that drives a high volume of Web traffic, and ensuring your offers and messaging flow across the two channels are the most important challenges to focus on.
Lee: When you're creating a DRTV spot you want to focus on the call-to-action (CTA), typically calling an 800 number or going to a dynamic URL. If you start incorporating social profiles, such as Facebook or Twitter, in your DRTV spot the viewer can become distracted and not take action. While having a strong social presence is crucial for a successful campaign, it’s an extra step the consumer has to take before they can purchase or submit their lead information. While everything is talking about how important social is, marketers need to remember that keeping it simple and straight forward often times is the best strategy.
Medico: Formatting the information to fit the medium; producing a compelling enough creative to entice the consumer to order; and generating sales at a profitable level.
Sarnow: No doubt, attribution is still the most difficult challenge facing marketers working on the Web. So many different channels want to take credit for driving sales when, in fact, the commercial airing offline is what drives people to call and to the Web. Media buyers and Web experts extol their solutions to the attribution issue. But still, this is a Picasso in progress.
Stacey: The biggest challenges are organizational in nature. These would include nurturing an organizational culture that embraces these new forms of marketing, that avoids building silos and works collaboratively and in alignment with one another, ensuring we have a built-in learning capability as a company to stay ahead of the latest developments in this growing area. In this respect, we’re seeing more and more traditional DRTV companies registered at conferences like AdTech and Internet Retailer as they try to learn and embrace all these new advertising modalities.
Yallen: Accurate, timely Web response attribution; quantifying the impact that DRTV has on search — the need to track and attribute leads/sales that come in via search engines; lower order conversion on the Web (vs. phone conversion); how to combine TV and online advertising to drive purchase behavior, plus build brand simultaneously and cost-effectively; implementing an effective, complementary search engine marketing (SEM) campaign to coincide with DRTV rollout; and how to convince new advertisers that it’s better to choose a DRTV-based agency as opposed to an online-centric one to run their campaigns. DRTV agencies are better equipped to handle attribution and analysis across media channels and provide the strongest multifaceted analysis and strategic direction.
What are the three biggest opportunities digital marketing outlets offer DRTV marketers?
Garnett: Trolling for searchers is most critical. DRTV drives tremendous online activity as consumers look for more information about products that they’ve discovered on TV. Both unpaid and paid search approaches should be considered to turn that online activity into sales. Beyond that, the Web is roughly a 5-percent opportunity if your TV campaign is strong. If you test TV and decide to move away, online work can sometimes build a small profitable business — but it takes considerable effort.
Heroux: It offers an opportunity to market to consumers that may not be watching TV, listening to the radio or reading the paper. Also, it allows consumers to promote your products or services — via social media — which could not have been done pre-digital times. Finally, since most of our campaigns start with a good commercial, it allows us to use that commercial beyond television.
Koeppel: A more data-driven approach using digital analytics; funneling DRTV leads into digital channels — optimized landing pages, high quality digital content, etc.; and an opportunity to distribute valuable video content to audiences that they might not typically have access to.
Lee: According to Nielsen, three out of five mobile subscribers in the U.S. own a smartphone. The continued growth of mobile advertising networks is making this channel a home run for generating leads. Additionally, as the Web matures, the testing platforms and methodologies continue to evolve and become more sophisticated to help marketers optimize their campaigns for each channel and user demographic. This detailed tracking, testing and reporting combination enables our clients to maximize their ROI. Finally, real-time bidding (RTB) is a form of PPC online advertising where you bid on each individual banner impression based upon the viewers attributes, rather than on a particular traffic source. By only advertising to viewers who meet your demographic profile, the campaign's ROI is significantly increased.
Lyons: Extending the marketer’s message across all platforms; creating the ability to make targeted programmatic buys; and introducing 360-degree sponsorships that include immersive branding, integration and social.
Medico: The three biggest opportunities are: the sheer availability of outlets for digital media; the large numbers of potential respondents; and the low cost-per-thousand to expose your message.
Sarnow: More sales, stronger branding in a DR campaign, and keeping a campaign alive after the TV media falls short of cost-per-order (CPO) and media efficiency ratio (MER) goals.
Stacey: There are many opportunities for DRTV marketers to use digital and social media. I think the biggest are simply to understand all the new tools that are available, how they work, and how they work together to drive results through different distribution channels including DRTV, print, live shopping and retail. One specific area we’ve seen move an increasingly large amount of volume is with the use of deal sites like Groupon and others.
Yallen: The ability to generate accurate, timely Web response attribution gives a true competitive advantage to any company able to provide it. Landing pages can work in symbiosis with DRTV messaging/offer. There’s also an opportunity to create true synergy and high-level communication between DRTV and search planners and buyers regarding how to determine the most effective methods for DRTV to work in harmony with digital marketing tools (search, E-mail, social media, etc.). Finally, you can implement an effective complementary SEM campaign that coincides with the DRTV rollout. It is imperative to develop a keyword strategy that plays off the key content of the DRTV spot.
How can DR marketers best utilize the online video space to capitalize on their media spending?
Garnett: First and foremost, online video gives people who have seen your DRTV the opportunity to see it again to evaluate more deeply and/or to show it to other people (sometimes to validate their own choices and at other times to spread the word about an interesting product). So it has a powerful role as an adjunct to your TV campaign. Online video is not yet a reach-out medium you can use to find people and get them interested in your product. The truth is that if you post it, they won’t come — unless you also advertise it on TV.
Heroux: The online video space helps in so many ways. But I would say that one of the greatest benefits it has on media spending is that it gives consumers a place to go to learn more about your product offers. It gives the marketer another opportunity to further showcase the features and benefits to help the consumer make a better decision and hopefully make the purchase.
Koeppel: Since we know that the majority of direct sales are now happening online, it stands to reason that when it comes to the use of video online, following some fundamental best practices are in order. That means that whatever you do, you have to make sure that your message is consistent and that you are using the most compelling part of your video presentation, given how short attention spans are these days. The reason this is important is that a marketer has a better chance of closing the sale online if they use video that is cogent and persuasive. These sales will ultimately help TV-driven MERs, regardless of the channel where the sale is ultimately closed.
Lee: We make sure when we're shooting a new show that we leave time to create content just for the online video space. Primarily, this includes additional testimonial videos, product videos, before-and-afters if applicable, or extended interviews with the product inventor or pitchman. By planning for this before we do the shoot, we're able to maximize our studio time and generate a significant amount of extra creative assets that are extremely cost effective.
Lyons: DR marketers can reach across platforms to get their message out to make sales. By planning ahead of time they can best take advantage of their relationships with their network partners to make cross-platform buys, encompassing digital and traditional media.
Medico: The greatest advantage is the ability to produce an elongated message to create a complete message and sense of urgency.
Sarnow: The first thing is that just about every marketer creates hundreds of minutes of footage to end up with a two-minute spot and quite a bit more for an infomercial. Segmenting the video into testimonials, demonstrations and sales pieces to put all over the Web is obligatory now — not a luxury. Google’s algorithms favor video as well. If you want great placement, video is ideal.
Stacey: We use videos wherever they are cost effective. We use DRTV to drive people to the Web for more information and additional video clips. We use social media to drive people to further links and clips, viral videos and YouTube campaigns, and even QR codes on our retail packaging and promotions, so consumers can play videos on their smart phone right in the store.
Yallen: Marketers can re-purpose TV creative for online in a cost-effective format (in the shortest lengths possible — 15 or 30 seconds), and purchase targeted, cost-efficient inventory via ad networks or trading desks to minimize cost-per acquisitions.
How much is the expansion of the DVR/on-demand/over-the-top (OTT) content universe affecting the DR-digital marketing space today? How about three years from now?
Garnett: As I’ve noted often before, none of the prognostications of DVR doom came true. The truth is actually even better — since DVRs are now proven to increase advertising effectiveness. At this point, OTT has done what I expected as a first step: it has primarily replaced the video store. However, it’s still developing as a medium. The current world of OTT chaos is not likely to get mass traction as more than a video store replacement. Can someone develop a serious daily programming option that offers advertising value? We’ll have to see — it’s not on the horizon at this point.
Heroux: It continues to make the DR-digital space more and more important and this will continue to grow in years to come. Consumers will not sit through two-minute commercials while watching the content of their choice. The consumers will be the drivers of what they watch, not the networks.
Koeppel: Clearly the ability to disrupt traditional linear broadcast television using DVRs and OTT content is having a profound affect on the interruptive advertising model. As an industry, we need to start thinking about how to use the full arsenal of marketing communications — including social and online media — to migrate from an interruptive advertising model to one that is participative where our audience(s) opt-in. The current situation — where the public gets to watch what they want to watch when they want to watch — is in its infancy, but the adoption of this preference will register as a massive sea change three years from now. The industry needs to realign its priorities to match consumer behavior, which is all about individual behavior and personal desire. The good news is people will still want to buy new and innovative products and services, but we need to meet them at a time and place of their choosing.
Lyons: Measurement studies have shown video consumption is on the rise across a variety of delivery methods. The DR digital marketing space, as well as the traditional DR marketing space, is evolving, as direct response has continually since its inception.
Medico: Currently it’s not having much of an effect, but this can become a problem as audiences become so fragmented due to programming choices. Responses generated through specific media outlets will shrink and become inefficient.
Stacey: The DRTV business model has been disrupted not only by DVRs, on-demand and OTT content but also by the massive amount of content and multitude of ways to access it. This has changed consumer buying habits and the purchase decision process. So it’s really about being clear about your objectives and your target market and how to generate awareness that leads to action often in the form of search and then research and then a purchase decision. We’re switching from passive-push marketing to active-pull marketing with the consumer now in charge of what they want to see. I think this trend will continue during the next three years and beyond.
Yallen: InterMedia is fully aware of the increased role technology and emerging media play in the daily media consumption cycle of consumers. The media landscape is rapidly changing, driven by the expansion of consumer viewing habits from TV alone to the combination of digital platforms and TV. Readily available TV content on digital platforms, major media companies enabling their content online and on mobile, on-demand, interactive TV and OTT, and the rapid adoption of smartphones, tablets and other connected devices, have given rise to a consumer that values on-demand and on-the-go TV consumption. Although millions of consumers still watch their programming from the “traditional” TV platform, more and more consumers connect with video content via “non-traditional” platforms. This complex television consumption environment poses a variety of new challenges for media companies, marketers and advertising agencies. Media companies seek to maximize audience enjoyment and engagement, while agencies still need to ensure that advertisers maximize effectiveness and reach to garner the greatest ROI for their ad dollars. As media companies and marketers both continue to expand technology and emerging media in their overall mix, effective allocation of advertising dollars across TV and digital channels presents a challenge. New insights are needed to understand consumers who use media in different ways, and to guide the development of solid marketing and media strategies. InterMedia makes ongoing investments in relevant software and studies which dissect how consumers use TV, Internet and Mobile alone and in combination — and in turn, allows us to effectively and efficiently allocate those media dollars for our clients.