Tra-Who? Tra-digital…. Prediction 1

Thank you to all the people who sent me feedback and comments and congratulations and commiserations in losing free time in starting this blog! You all know who you are. I’m chuffed to see I got 950 hits in one day! I’ve asked my mother to stop clicking.

So going back to the first post on my predictions; the word tra-digital came up. Basically it is the ‘in’ word in expressing the share shift we will see from traditional advertising medium moving over to more digital mediums.  We’ve also seen those campaigns where things like the new mcdonalds burger is blasted from a tv advert, a radio commercial, a newspaper drop and 160 x 600 ad creatives all over the internet sites. More and more companies are carving out their budgets to split across as many mediums as possible in the belief in gaining a wider reach. There is evidence to support this from subliminal advertising to panels discussing why a certain shampoo is bought over another.

That split that has been happening is at the cannibilisation of the more traditional mediums.  So, if a planner has 100k ad budget to spend on a campaign and they choose 20% on digital – the more traditional mediums has lost the 20% to digital mediums (or media).  This has been ruffling feathers for many years and we’ve seen this battle before.

Think back to the world of e-commerce. I worked for a very prominent ISP company in their e-commerce division and the challenge these ‘high street’ redbrick stores had was a panick that they would be extinct once e-commerce started evolving. Social inertia prevented extinction because man for all intents and purposes is still in love with the feel and touch of a product rather than buying from a website which is cold and unappealing. Stores across the UK were resisting technology and sticking to their comfort zone in hopes that e-commerce would flunk and die like the dodo. Well, it did the opposite but it did not kill off the high street stores in one swoop. It did kill off the smaller boutiques and many stores did close down or relocate or even merge with others; but it did not kill off an industry.

The industry and its players evolved. Unfortunately some did not survive but that’s not a bad thing if they were not necessary or if they were simply there without a unique offering. Efficiency will outlive us all.

Mr Murdoch is worried. He should be. Advertising revenue is keeping his newspaper business afloat and yes it will affect him negatively when tra-digital becomes a fuller force but it is very unlikely to kill his business off. We’re creatures of habit. We’re not going to change overnight.  The industry is changing and its at a faster rate then we’ve ever seen in advertising.  This has been a long time coming given that most newspapers have their own website; some charge for restricted content; and others are thinking about the engagement with the kindle and ipad. We all move forward.

So why is tra-digital going to move faster in 2010?

2010 has been a year of innovation; the ipad came out. The iad is about to come out and take over our minds as to what we do and don’t like. When I started at Right Media no one knew what it was, how it looked, what it could do or what the hell we were talking about. I remember talking to clients at a presentation about the film; the Minority report and discussing how technologies would evolve to pin point our likes/dislikes or wants/needs and how our very own habits would formulate a big brother murial of who we are. iAD is effectively what I was talking about. Right Media was an example of one of those technologies that would get us to that next evolution of technology. I like to see the advertising landscape as one big technology pipe. We’ve done ad exchanges so the next thing has to be ….

Once you can start trading adverts for ad spaces then the next step has to be to start trading the right ads for the right spaces that are meaningful to the advertiser and user.

Behavioural Targeting was that next technology and the ad tech companies in USA were already data collecting and pooling to start building that user profile. ‘ If you build it they will come’ – they being the advertisers.  Now with this going on in the ad world you have the mobile product world carving out the adoption of 3G and new mobile products that are ultimately ensuring users are consistently switched on to as many mediums as possible. This means aggressive push from phone manufacturers to stay ahead of the game.

The push to tra-digital is coming from the new technology emerging and the adoption from consumers to get the latest gadget. The advertisers have no choice but to move to the whirlwind audience they are trying to identify and engage with. This puts pressure on all the value chain to ensure they are embedded with the right players to survive.

You throw in social media and its all panic stations. Then you sprinkle in some DSP’s into the mix (wait for further posts on that one) and you’ve got the whole value chain wondering if they will survive. (Think back to my e-commerce analogy). Don’t panic but build around what you know and speculate on what you think.  I’ve been speaking to quite a few value chain players from all over the world and all are nervous. Some have taken on experts to think about strategies which is exactly what they should be doing. (of course I’m going to say that!)

So in summation –  APAC is around 3-4% of the total advertising revenues spent on digital media versus the traditional media. What is going to be that tra-digital shift figure? Well at least double that is what I believe.

Next you have the greater emphasis on ROI. Yes that ugly word rears its head in times of economic despair. Budgets are apportioned to the best ROI and the ugly sister of Brand advertising; Performance rears its heads. There are lovers and haters of it. I’m a pure lover for performance but it has to fit what the campaign criteria is. No one should jump on performance for everything.  When dollars are driving at ROI – the shift between Premium and remnant advertising gets more blurred and publishers have to be concerned. Once you have a smaller gap between the two; publishers start losing sight of their content creativity and look to their own advertising revenues and eventually performance inventory may not be the right medium for you.

SO when you put all these factors in play you start building up the pull/pull factors on the landscape and a picture starts to evolve. Last but not least add a dash of….

Multimedia 2.0

is going to see a greater shift between paid media, earnt media or owned media.

This is a great article about the types of media I mentioned above:

http://news.cnet.com/8301-13641_3-10237112-44.html

So really my final point; VIDEO kills some of the ad stars….

Video growth online has erupted for longer than the Icelandic Ash Cloud and its about to heat up all over 2010 with the ipad fueling it. Below is a prediction from Forrester:

7.1BN (by 2012) spend in US alone for advertising/marketing on videos! CAGR of 72% from 2007 to 2012.

Okay I’m going to call it a night but before I do any thoughts on the latest goss? Google is after Invite Media (DSP) – hhm……

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About adsolver

Ad-exchange expert with Rightmedia and Yahoo. Strategist on the evolution and ecology of the international display digital platform. Specialties: Evanglising Glocal digital marketing with outstanding experiences in Ad Exchanges, Behavioural Targeting, eCommerce, Multivariate Testing and data mashing. Have worked previously in the following industries: Internet ebusiness solutions multivariate testing Oil and Gas experience and Renewable Energy White-labelling Travel websites Telecommunications Advertising Exchanges
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