The New Dynamics of Digital AdvertisingKatie O'Neil
“How much would it cost to run digital ads in X location for two weeks?”
“That depends on a lot of things. Let’s start with what you’re trying to accomplish…”
This is a conversation that any digital marketer will recognize as we move from the limited traditional media advertising options of the past to the brave new world of digital advertising. In the recent past, advertising was limited to buying a set number of tv spots, newspaper inches, or billboard days. These things all have fixed costs and broad audiences, making ad campaign plans static and straight forward.
Digital advertising has completely changed the game. While some more traditional pay-up-front units exist in the digital space, the vast majority of digital ad buys are different in nearly every way.
Perhaps the most exciting change is the ability to target ads to much more defined audiences. Ads can now be targeted to extremely narrow locations, a wide variety of demographic criteria, interests, online behaviors, specific email addresses, and more. Different platforms offer different possibilities, and those options change on what feels like a daily basis as new technologies become available and other forces, such as privacy concerns, take greater precedence.
Most digital ads are pay-as-you-go, and many have virtually no minimum spend. If you want to buy $5 worth of ads, you can. If you want to stop your campaign abruptly, you can do it with the push of a button without being charged for any remaining budget.
The cost calculations are also far more complex than in traditional media. Most digital ads are charged on an auction system. Instead of paying a set price for a fixed number of ad views, ad costs are determined in real time by a complicated algorithm comprised of how many people are bidding for the same audience, how engaging the content it, and how much each bidder has stated they’re willing to spend.
Real-time, or close to real-time analytics also mean that digital ads are perfect for testing. It’s not just possible but recommended that advertisers test a variety of images, text combinations, and targeting options for every campaign. And unlike traditional media, this doesn’t have to mean re-cutting a new commercial or designing a new billboard. It could be as simple as changing a few words inside of the ad platform from one ad to the next.
When you add all of these elements together, an ad campaign could start with a small spend on a wide variety of platforms, targeted to several different audiences, with many different ad creatives. Optimizations can then be made throughout the campaign, moving budget to the ads that are yielding the best results and stopping those that are underperforming.
So when you decide that digital advertising might be an asset your campaign, try to avoid approaching the project seeking a static plan with a clear price tag. Instead, determine what audiences specifically you want to reach, what you want those audiences to know or do, and what each action or impression is worth to you. From there, you can collaborate with the digital ads team on a dynamic plan that maximizes your spend by sending the most effective messages to the people that you really want to reach.