Digital Trends : 14% CMOs anticipate mobile spends to rise upto 50%

2015 mobile advertising IAB report

The Interactive Advertising Bureau’s (IAB) recently released “Marketer Perceptions of Mobile Advertising” report, which surveyed more than 200 marketers, found that more than three-quarters of marketers believe that programmatic mobile is important, or at least somewhat important.

Surprisingly, only 27 percent of the marketers surveyed had actually purchased mobile ads programmatically.

The good news for the programmatic industry, and for marketers as a whole, is that the technical hurdles that once prevented programmatic targeting on mobile are now largely a thing of the past.

A variety of solutions have emerged to solve mobile’s cookie problem: client log-in, app SDKs (Software Development Kits), and mobile Web behavioural data to name a few. Tie a shiny bow around all of that with geo-location, and we’ve begun to master mobile.

Here are some of the key digital trends from the report:

  • Marketers expect that their spending on mobile advertising will increase over the next two years: 14% anticipate it will rise by more than 50% while 57% expect it to rise by less than 50%. 
  • About one-third of mobile advertising spend is substitution from other channels, with print media hit hardest (58%), followed by PC digital and TV. 
  • Marketers in our 2014 survey show a high level of satisfaction with the results of their mobile marketing activities. The majority is either satisfied (50%) or fairly satisfied (37%) while a further 8% completely satisfied.
  • Marketers show a strong interest in mobile programmatic, as 41% agree that it will help them reach target audiences. However, relatively few are actually buying mobile inventory programmatically today: 18% via private exchanges and 17% via open exchanges. 
  • Marketer uneasiness over potential data privacy issues is pronounced. 37% of respondents in 2014 cited privacy as a very important issue compared to 22% in 2013.

Ranking for Mobile Advertising Inventory

  • Mobile websites continue to take a central role in mobile advertising, with 22% of respondents ranking these as the most important type of inventory for their mobile campaigns.
  • Sixteen percent of respondents prioritised mobile search as most important for their mobile campaigns.
  • Mobile optimised social media campaign is gaining its popularity slowly and steadily, with 14% audience placed their bets on it.
  • Mobile rich media is losing its popularity due to diversity in type and size of devices in the market.

Here is a short summary presentation of the 2015 IAB Mobile Advertising Report:


Digital Marketing Consultant vs Digital Agency, both are relevant for business

digital marketing consultant vs digital agency
This post is not to convince people against digital ad agencies, instead it is to help business owners make better business decisions.

Back in 2006, when I started my career in Quasar Media (a leading independent digital agency & now a WPP company) , I never thought that I would get an opportunity to work as an independent Digital Marketing Consultant for such a long time.

Over the years, I’ve worked with clients ranging from enterprise companies to absolute bare bones startups. For someone like me who has actually gone through from the mad corridors of digital advertising to the “politically corrected” corporate boardrooms and now a “meandering consultant”, its been a helluva ride.

But this post is not about me, this post is to help you make better decisions while you are choosing the right marketing partner for your business. But lets understand the business problem in a much more holistic manner.

In the last 5 years, there has been a massive increase in the number of marketing channels, marketing technologies are changing at the pace of light and the world is no longer about just generating new customer leads, thanks to social media and mobile ad tech, you can now predict when and from where you would get your next customer. But all of that isn’t that simple either.

Gartners Digital Marketing Transit Map
Gartners Digital Marketing Transit Map

Gartner’s Digital Marketing Transit Map is just an indicator of this increasingly complex world. Needless to say, with newer technologies like artificial intelligence taking over the reins, marketing can become further complex for future organisations.

In this situation, every business must choose the right vendor partner who can help them navigate through this phenomenally complex world of digital marketing.

The decision of choosing between a Digital Marketing Consultant vs Digital Agency is usually based on the size of the organization, but there are still multiple factors that affect this decision:

Digital Marketing Consultant Services
Digital Marketing Consultant Services

For Enterprise Company

If there is one word that defines their business, it is “LARGE”.

For them it is an obvious choice to hire multiple vendors/ agencies to manage their different digital work streams like customer acquisition, brand management, technology development, content marketing, publicity design, customer relationship management and the most critical one, data management. Based on these, an enterprise company usually hires vendors for the following functions:

  • Digital communication design
  • Technology development for different platforms like web, mobile, digital outdoors etc.
  • Digital brand strategy
  • Localisation agency to managed campaigns in different regions
  • PR & Social Media Agency
  • CRM
  • Digital Content Production
  • Customer Data, Analytics & Research Partner
  • Digital Media Agency ( for paid media campaigns like SEM, FB ads, Performance Marketing, Affiliate Marketing)

There are very few cases where an enterprise company hires an independent consultant. Only where the work is project based and highly niche in nature which cannot be provided at the same level expertise by any of the existing vendors in the market, hiring a consultant becomes imminent for the enterprise brand.

For Small Medium Business

This is where it is most difficult to assess your business requirement. Majority of the SMB’s are focussed towards generating more sales and not building their brand. For them, marketing is an expense, which should be avoided as much as possible, and only ROI driven marketing tactics are considered by the business owners with the clear objective to achieve sales.

However, there are multiple segments (based on size, nature of business, employee count, technology, customer base etc.) within the SME space, each of which has a different level of marketing requirements.

  1. For Local Business – the size of the business is extremely small ( like a small travel operator, Builders & Real Estate Agents, SOHO business, local retail, personalised services etc. ) which is not lucrative for any mid-large digital vendor, not just from scale but from monetary standpoint.
    1. Their marketing requirements (briefs) are often vaguely defined and restricted to most commonly used plus tried & tested digital marketing practices like Search optimisation & Adwords Marketing, Social Media Optimisation and Lead Generation.
    2. Most of these businesses get their low cost websites done by some local web design company without much focus on brand hygiene or customer relationship.
    3. Recommendation : Today, there are tremendous opportunities for any local business to grow, what they lack is a clear focus and direction based on the type of their business. Digital Marketing Consultants are best bets for local business as they can help them define their business focus and create a simple roadmap to grow without spending too much money. Its like visiting a private doctor’s clinic for expert’s advice before getting admitted to a hospital.
  2. For Startups – they come in many shapes and forms based on the stage of business , funded vs bootstrapped, tech vs non tech, product based vs service, e-commerce vs non e-commerce. Based on the type of startup, their marketing requirements are also different in nature.
    1. Early stage startups literally bootstrap their marketing expenditure for a long period of time. I’ve seen founders getting their hands dirty with everything in the marketing, right from building the strategy, finding alliances and partners, writing the PR copy, social media campaign, customer support etc.
    2. Startups are also secretive about their core idea till they build enough customer base. They usually hire people for doing specific task in marketing like SEO, Social Media Marketing, Email Marketing etc. (Also read : How to hire for your bootstrapped startup?)
    3. For startups who manage to raise decent amount of funding in Series A/B, prefer to build their own digital marketing team instead of working with ad agencies. I guess most of the startup founders believe that ad agencies would not understand the vision completely. However, the trend is changing, startups are working with digital vendors for specific requirements like content marketing, online video campaigns (Also Read : How beautifully Faballey created their #unfollow campaign)
    4. Recommendation : on one side, early stage startups badly need top quality resources, but they also want to bootstrap it till the time they find gold aka funding source. Building momentum is super crucial for the founders as it allows them to build a strong business case to prospect investors. In this situation, it is highly advisable to hire experienced Freelance Digital Marketing Consultant who’ve been there and done that. The biggest benefit of working with a consultant is that they bring best practices from all perspectives including product management, sales, integrated marketing, customer relationship management etc.
  3. For Small Enterprise – these companies are those who are on a growth trajectory and certainly big enough in terms of their marketing operations, that allows them hire full time digital agencies.
    1. Despite being cash rich, these companies are extremely performance driven and sales focussed. Having said that, they still hire best of the marketing resources from elite B-schools all around the country by offering fat pay packages.
    2. Their requirements are often multi disciplinary, right from the core strategy to building a sustainable marketing plan to finding right partners in every aspect of their business.
    3. Usually these companies are cash rich and are prepared to spend money on brand building as well. The annual revenues are in high 3 digit numbers with double digit YOY growth.
    4. Please note, below recommendation is extremely relevant for Small B2B enterprise companies.
    5. Recommendation: Companies like these should prioritize their annual budgets and resources based on their short, medium & long term goals. While a Freelance Digital Marketing Consultant may not be the right option as (s)he cannot drive scale for their ambitious growth plans but (s)he can certainly come handy to drive certain specific needs like corporate training, creating your website content, creating your corporate blog strategy, building your website SEO & analytics. Digital Agencies are perfectly modeled for this kind of business as they can offer end-to-end services to their clients.

5 ways to get startup funding for your digital agency

startup-funding-digital-agency

If you are an avid follower of the startup news, you might have noticed that most of the startup funding is landing in the tech startup space, that too largely in the mobile apps & e-commerce category. Have you ever wondered why the startup advertising agencies are not in the investment radar.

Why is it that the most innovative or profitable ones (agencies) get acquired, while the rest struggle to make their mark for a very long time?

If you are an owner of a digital agency startup, here are few things you must build in your business plan in order to secure startup funding for your business:

1. Productize your offering

There is a general assumption that agencies are service based companies (which is not incorrect) and their revenue model is fragile. The competition is so intense that you have keep searching for leads all the time. Payment cycles are long and ‘client loyalty’ is limited due to which advertising agency is considered (or perceived) as low cashflow business.

In order to change this perception, you need create a unique product of your service which has a tangible aspect to it. One way you can do it through technology i.e. by building custom proprietary solutions targeting a specific need (like lead generation, customer engagement, user behavior, customer satisfaction) in a particular industry.

Once you do the above, it would lend measurability to your business model. You can actually predict a certain revenue based on the target audience you have made that solution for.

2. How to showcase your solution to an investor?

Every investor wants to see a practical and profitable business application of your service/product. Do your research on different brands across industries, make an attempt to understand their brands and business challenges. In the agency world, this is called working back to the creative brief. Figure out why your solution or service best-suited to help a particular client.

Show examples & case studies to your investor as to how you transformed it for a particular client.

3. Demonstrate Measurement and Support Capabilities

Make sure you have a sophisticated measurement and accountability system embedded into your technology. Analytics are essential components of the agency business, so be sure to address the topic in your presentation. Also mention your team, however small, in your pitch. Even though you may be a small startup, you have to reassure that you and your team will be able to see any project through to the end.

4. Scalability is critical

One of the key criteria of evaluating any business model is to see how quickly it can scale in time. Every agency is currently dealing with this issue of scalability, especially because they have not embraced the technology to the fullest. Most of the processes (especially around Project management, client relationship, resource management), can be automated through various digital tools available on the cloud. These technologies allow you to get more done with limited number of resources at 1/10th of the operating cost.

Once you have a strong business case, the investor would be interested in knowing how you would scale up the revenue & systems to handle hundreds & thousands of clients? That’s why your investor pitch needs to have scalability in its DNA.

5. Demonstrate multiple business opportunities and revenue models

The investor is also interested to see the vision behind your business. Are you thinking ahead of your time and your competitors? Do you have the team who can produce cutting edge solutions based on past, present & upcoming platforms?

A single business model can never succeed and is too risky to put investor’s money. Having said that you must showcase your plan of action around every revenue model that your company would touch in the next 5 years.

What are places where you are trying to generate first mover advantage for yourself? How will you accelerate existing revenue models? What are the new audience segments you would try to penetrate where existing market hasn’t ventured out?

6. Brand your startup agency

There is no doubt that digital is the hottest proposition at the moment. Every company is re-looking at their business models to match the growing requirements of the digital world. In this case, it is absolutely vital for a digital startup agency to build their startup philosophy in order to create a differential.

A smart investor would definitely like to see how good is the social media of the company who claims to bring the next big disruption in the space. Is your website behaving like a notice board (bored) or your achievements or if it is designed to share valuable insights & trigger conversations?

Also read: 25 ways to Brand your startup

Beware! Do not consider creating a fancy parallax website as thought leadership. Disruptive strategy does not require show off. Sometimes, it is doing all the right things in a clinical manner that makes a huge impact.

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