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ADVERTISING

How to Increase Ad Spending Wisely
 

A 2013 report by Neilson offers advice for advertisers that are considering an increase in online brand advertising budgets.

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As media consumption continues to shift from traditional media to online channels, so will investments in advertising budgets. According to Nielsen's 2013 Online Advertising Performance Outlook, 63 percent of marketers say they will increase their online brand advertising budgets in 2013. Additionally, nearly half of all advertisers in the survey are shifting spend from television to digital video.

Although budgets are moving to digital channels, advertiser expectations are changing as well. To validate performance, advertisers are using metrics before shifting budgets from traditional to digital. Measuring effectiveness is a way to reassure marketing departments reluctant to switch, and it's a great way to keep track of every dollar invested in digital.

Old and New Advertising Effectiveness Metrics

Advertisers understand that online channels have an unmatched ability to track user behavior. Therefore, advertisers expect reporting on performance metrics that cover traditional benchmarks as well as additional metrics to show channel performance. According to the following figure from the Nielsen report, the majority of advertisers expect online performance metrics in addition to metrics from traditional channels.

ROI Tracking is Essential to Increase Ad Spending

The old strategy of "unlimited budget for marketing that works" is driving the increase in online advertising spends, since returns on investment are easier to track. This was the top response for advertisers that are increasing online brand ad spending; if you can prove it generates ROI, then budgets will increase.

Reaching the Right Audience

Relevancy is more important than ever. According to an Accenture report, consumers put more value on relevancy than even customer service or product value. The Nielsen report also found that 42 percent of advertisers wanted verification that they were reaching their intended audiences through the campaigns, and that this metric led to increases in advertising spend.

Toolsets available to advertisers today provide the ability to target a specific audience to a higher degree than ever before. Search engine advertising targets not only keyword usage, but also user cookies that dig deep into past behavior. Retargeting also uses cookies to track user behaviors. Real Time Bidding (RTB) platforms calculate user data in real time and provides automated bidding to advertisers, all of which happens in milliseconds while the user is loading the page online. All of these calculations are made to connect brands with the perfect prospect for the advertising message.

These tools and others are what marketers use to measure ROI, cost per customer acquisition, brand reach and prospect relevancies to generate even higher returns on ad spend. Before you consider increasing your advertising spends with any particular digital channel, use these metrics as verification that online advertising strategies will work for you.

Last updated: Jul 3, 2013

AARON ADERS is co-founder of DigitalRelevance, a national leader in earned media and inbound marketing services. Building on more than a decade of Internet marketing experience, Aders steers the strategic vision behind DigitalRelevance's market research and collateral.
@drelevance




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