IS DIGITAL ADVERTISING REACHING A TIPPING POINT?

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The steady shift in advertising dollars from traditional media like TV to digital media like Facebook and YouTube seems like a nobrainer. Ad dollars chase eyeballs. And there’s no doubt people are glued to their mobile devices, spending less time with traditional media. Online analytics are becoming ultra-sophisticated as well, making it easier than ever to measure your digital ad ROI. That is, if you trust the companies doing the measuring. Recent revelations suggest things aren’t as straight forward as they seem. Can innovation fill the trust gap?

Most of the major online platforms have been busy this year concocting new advertising options that capture the attention of companies looking for engaging alternatives to ineffective banner ads –while also addressing the challenges posed by more sophisticated ad blocking technologies.

The creativity these platforms are displaying in their approach to online advertising is impressive. Unfortunately, a slew of recent news stories suggests these platform providers are also being “creative” at times in the way they measure ad views. Companies intent on reaching consumers that have digital devices for appendages are starting to question the trustworthiness of the online ad measurements they’re being given. The growth trajectory of the$194 billion global digital ad market could be stunt-ed if marketers aren’t certain they’re getting real value for what they’re buying.

Facebook’s Facepalm

The lack of transparency that frequently afflicts the advertising industry was on full display when the Wall Street Journal reported in September that Facebook had been inflating the average time users spent watching its video ads for the past two years. Facebook told major ad agencies and ad buyers that it only counted video views of more than three seconds in its metrics, which artificially inflated the average viewing time between 60 to 80 percent. And no, that’s not a typo.

While Facebook has apologized to advertisers, this reinforces a belief that large online platforms are “walled gardens” providing limited information on precisely how their ads are being viewed. Facebook might be the most egregious example of metrics manipulation, but it’s certainly not alone. Marketers routinely question whether they’re wasting money on ads that are positioned out of clear viewing range or are displayed on syndicated sites with computer-generated (a.k.a. phony baloney) traffic.

And yet, despite these reservations, companies are fully aware of the need to continue increasing their ad spending in the digital space – particularly on mobile devices. And they’re doing so in tsunami-like fashion. Facebook now has 4 million advertisers…an increase of 33% in just seven months! More than 90% of Facebook’s users are on mobile devices,which explains why mobile device advertising accounted for 84% of Facebook’s $6.2 billion Q2 ad sales – a revenue increase of 80%. No, that’s not a typo, either. There’s a lot to “Like” about these numbers if you’re a Facebook shareholder.

Engaging New Options

From the marketers’ standpoint, the tipping point alluded to earlier isn’t so much whether or not they will advertise on mobile platforms – of course they will. The question is, what price will they be willing to pay if they don’t trust the metrics they’re being given? And, more importantly, don’t get the results they expect.

Zuckerbergians contend that advertisers need to look beyond views and likes and evolve to “metrics that actually matter” in gauging the effectiveness of online ad campaigns. Engagement is the Holy Grail. Toward that end, the major platform players have been rolling out lots of new options to help marketers optimize these channels. Keeping up with it all is more than a full-time job for online media mavens, let alone me, but here are a few things that caught my eye.

Facebook’s Biz Boosters

Facebook offers advertisers a variety of different options for tapping into its 1.57 billion daily active users. You can “boost” your posts to an audience of your choosing, which integrates your message directly into the target audience’s news feed. There are also lead collection ads (a “sign up” button is used to collect names and email addresses) and offer ads (your target audience is prompted to “claim offer” and receives an email that activates whatever deal you devise). Both make it easy for you to drive traffic with almost no extra effort on the part of users, and also gather targeted email addresses.

There’s even more innovation on the metrics side. Big brands are being given tools to see how their ads on Facebook and Instagram lead to people making brick-and-mortar (or, in our industry, glass-and-steel) purchases. Sophisticated dash-boards that tie Facebook’s ad servers and networks to those from Nielsen, Neustar Market Share, Analytics Partners and others also enable marketers to do A/B testing and evaluate how exposure to different ads in different places at different times combine to influence purchasing behaviors.

Googley Goodness

Naturally, the granularity gurus at Google are devising similar tools that help marketers close the loop inproving online ads lead to sales. Google recently launched mobile display ads that incorporate location targeting. A resort property can serve smartphone users with mobile banner ads as they’re driving by, and Google can tell if the ad led to a visit or a sale of some kind on property. Cha-ching!

Google also announced a new feature in its Wazemap app that lets people “favorite” a brand which then shows up on their nav map anytime they’re close by a retail location. This could be used by brands to push offers to consumers as well. New cross-device capabilities in the Google Display Network and Double Click Bid Manager also let marketers re target ads to the same user as they shift between phone, tablet and laptop devices. Brand scan serve different parts of their message to the same consumer throughout the day. All automagically.

Watson Hears a Who

Watson – the cognitive computing wiz from IBM that’s kicked some Jeopardy ass, bested a grandmaster chess champ and whipped up creative recipes using foods you’d normally never think of combining – recently tossed its silicon hat into the consumer marketing ring.Taking online advertising where it’s never gone before in the process.

At a recent Interactive Advertising Bureau event,IBM demonstrated voice-activated interaction between a user and an ad appearing on The Weather Channel’s app. That’s right – people and ads communicating back and forth – the granddaddy of all engagement!

Here’s how the demo worked: After viewing aWatson-integrated ad from Campbell’s within the Weather Channel app, the user spoke into his phone and asked the Campbell’s ad to find him a meal with chicken and avocado. Seconds later, the interactive ad responded with photos, a recipe, and other options using similar ingredients. Users can also interact with the creations of other users based on the Campbell’s ad.

Over time, Watson will learn from users and tailor meal suggestions to individual consumers. It’s the kind of large-scale one-to-one communication between brands and consumers that marketers have been dreaming about. The technology is expected to be in beta for the next year as IBM develops partnerships with other brands in the consumer package goods and retail spaces.

To paraphrase Dr. Suess, “Oh, the places you’ll go!”

Op/ed column submitted by Ann Nygren, President of Key Consulting Software. KCS is an IT consulting company focused on gaming and hospitality applications ranging from Agilysys (LMS/Stratton Warren/Infogenesis), Infinium(AM, AR, FA, GL, GT, HR, IR, PA, PL, PY, TR),Bally’s (CMS, CMP, ACSC & SDS), and interfaces with Aristocrat, IGT and Micros to Transitioning properties during purchase, sales, or merging of properties. KCS provides IT Departments with assistance in installation & upgrades, customization, interfacing and creation of unique client-specific software. Ann can be reached at ann@kcsoft.com.

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