Advertisers are now in charge

The traditional advertising model has relied on a few powerful broadcasters delivering their product (TV, radio, press etc) to the public for free (or close

Inbound marketing is like a customer magnet for business

to it) then charging companies a fee to advertise to this audience. And for a long time it has worked. Mass media was the easiest and most cost-effective way to reach a broad audience with your business’ message.

Then things started to change. The mass media has fragmented over the last 20 years. More magazines, more television channels, more radio choices and then the internet. No wonder so many advertisers are starting to question where they should place their marketing dollars.

The ever increasing speed of the internet is the final straw. Suddenly traditional media is being delivered online and the consumer is spending less time reading newspapers, listening to local radio and reading actual newspapers. Suddenly advertisers are in a real quandary about how to market themselves.

But the fact is, this changing media landscape is good news. The low cost of production, the massive migration to online media consumption and the creation of a “search economy” means that advertisers are now in charge.

Its just that they need to re-frame their thinking.

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Advertising has changed…forever

Josh Bernoff from Forrester Research has just posted a piece on AdAge discussing the latest findings of a survey taken in the USA with leading marketers. The results should be alarming for traditional advertising media and agencies.

It strongly echoes our observations here in Australia. I have written a series of posts in the last year pointing to the same conclusion: Advertising shift permanent, What will agencies do when everyone can bypass advertising?, Perfect storm causing traditional media bloodbath, The sound of a marketing revolution, and A turning point in marketing and media history?

Here is what Josh had to say:

In this recession, marketers have learned that interactive marketing is more effective, and advertising less effective, per dollar spent. While budgets for online have decreased, they decreased less than other budgets. Six out of ten marketers we surveyed agreed with the statement “we will increase budget for interactive by shifting money away from traditional marketing.” Only 7% said “we have no plans to increase our marketing budget.”

Unlike the last recession, digital marketing is no longer experimental. Now it looks more like advertising is inefficient, relative to digital. More than half of the marketers we surveyed said that effectiveness of direct mail, TV, magazines, outdoor, newspapers, and radio would stay the same or decrease within three years. In contrast, well over 70% expected the effectiveness of channels like created social media, online video, and mobile marketing to increase.

The result is that digital, which will be about 12% of overall advertising spend in 2009, is likely to grow to about 21% in five years. Along the way overall advertising budgets won’t grow much.

This is huge.

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Inbound marketing turns websites into customer magnets

GetSticky turns your website into a customer magnet

Inbound marketing is the approach behind most successful internet marketing systems. Done well, inbound marketing can turn your website into a customer magnet, drawing motivated prospects towards your business.

Traditionally businesses have relied on broadcast style marketing and advertising to create awareness of their existence and offerings. Television, radio, press, billboards and Yellow Pages have all been the cornerstone of marketing efforts for the last 50 years. And these media have served us well, offering the most efficient means with which to reach a large audience quickly.

Broadcast marketing by its nature is like using a shotgun. You aim it roughly in the right direction (ie. general target demographic), pull the trigger and hope that you hit the right audience. Of course, you’re also paying to hit some unwilling bystanders (non-target demographic) but that’s unavoidable. You then trust that the people you have hit will react to your efforts.

Inbound marketing turns this approach upside down. It involves discovering where potential customers are searching, positioning yourself correctly so they’ll find you and letting them discover whether you have what they are looking for.

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Shift your marketing thinking to online in 2009

Is your business still rolling out the same marketing plan in 2009 as you have in previous years? If so, why?

There is now an abundance of evidence that audiences are changing their media consumption habits and that online is becoming the hottest place to start directing your marketing dollars. Even traditional media placement legend Harold Mitchell told Adnews recently that he saw 2008 as a year of significant change in the advertising industry, one that cemented the digital age as the permanent force in media.

But how many businesses owners and marketing managers have started making the transition with their own businesses? How many are currently sitting down and mapping out the same old marketing plan for 2009, allocating a budget to Yellow Pages that go unread or old media with declining audiences but higher rates?

There’s no doubt that we are entering a difficult economic climate. Businesses that adapt quickly and implement cost-effective changes reflective of the new media landscape will emerge in a much stronger position.

If you haven’t already begun exploring new options for your marketing, then make 2009 your year of transition:

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Build a web strategy to turbocharge your business

By the end of the 1990’s most businesses had a Web 1.0 website. They were basically glorified brochures and they cost a lot. Then in the mid 00’s Web 2.0 begin to emerge. Sites were more interactive, linking and sharing became de rigueur and the power of the Internet took on a whole new meaning amongst the smart online operators.

However, for much of the business world Web 1.0 sites are still being pumped out at an alarming rate. The boss realises he needs a website, or a new site, and then either the company IT person or contracted web designer dutifully bangs out a digital brochure. Build it and fill it with every detail about the company’s products or services and they will come.

No they won’t.

Your company doesn’t need a new website, it needs a great web strategy. Done well, businesses can derive an amazing number of benefits from its online presence. In fact, it’s arguable that you could build your entire marketing strategy around your web presence.

How? Let me explain.

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