It is massive, enormous, monumental, maybe even the second coming. Whatever you want to call it, we are currently experiencing more change in the marketing ecosystem then we have in the past 10 years (maybe ever). Are you paying attention?
This post explores:
1. The huge changes that currently changing mature marketing channels
2. The number of “Teenage” channels are coming into their own
3. The flurry of newborn channels that have just emerged
4. New channels that don’t exist today, but are on the near term horizon
5. Why all the change?
Core Shifts In Mature Channels
Look to almost any mature digital marketing channel and you will find it going through a major foundational shift.
Google is making some of the largest changes to search that we have ever seen in the history of the search engine. For starters, Google is near complete on its move to wipe out all keyword data from organic search. This is a huge change for the world of SEO that typically relied on this data to plan and optimize.
Google has also been making massive algorithm changes to emphasize things such as content freshness, social sharing, and author rank. While links are still important, Google is just at the beginning of incorporating other data to de-emphasize links as the main indicator of quality.
If this wasn’t enough, Google has made major changes over the past couple years to the format of their search results . Searches around local, travel, shopping, brand terms, and video have seen the most dramatic changes. Across the board paid search results are taking up more real estate pushing down organic terms. All of this doesn’t even include changes in the mobile search experience along with Google Now.
Display is being uprooted across the board. The buying, targeting, and ad formats of display are all changing. RTB (Real Time Bidding) has seen a steady increase as a volume of display inventory. RTB is now accounting for 20% of display inventory up from 8% just two years ago. Additionally, RTB spend is expected to grow 30%+ YOY for the next 4 years.
Much of the display world has relied on cookies to target effectively. But Firefox who holds about 29% of the browser market share is going nuclear on cookies, turning them off by default in future updates. Google and Microsoft have also announced initiatives to get rid of cookies. The shift to mobile and multiple devices isn’t helping either. More display inventory is moving to native mobile apps where cookies don’t exist.
Additionally the shift to mobile is much bigger than just cookies. So far the display industry has taken what has worked mediocrely well on the web and smashed it into a new medium. It isn’t surprising that mobile display CPM’s and ad performance has been abysmal. New targeting methods (i.e. Drawbridge) and ad formats are just starting to take shape and will continue to change mobile dramatically.
The world of email marketing isn’t safe either. Google is making some of the biggest changes we have ever seen to the inbox experience. The release of tabbed inboxes woke the email marketing world up as they saw their email campaigns be pushed to the “Promotions” tab. In addition to tabbed inboxes, Gmail is slowly rolling out Inbox Actions, which I think could be a powerful change in how we think about email marketing campaigns (transactional and promotional).
Mobile is also having a big impact on email as a marketing channel. 44% of email is now being read on mobile devices. The constrained experience of email on mobile is forcing changes in how email campaigns are formatted. But more importantly our email consumption habits are changing. Adapting growth techniques to these changes in habit will be important going forward.
Digital channels aren’t the only ones seeing change. TV is at the beginning of some big changes. The most obvious trend is the shift of TV ad spend to online video. More interestingly, the penetration of connected TV’s (Web TV’s) is reaching critical mass. In January 2013 connected TV’s were already in 1/3 of households with predictions of that reaching above 50% within two years.
We are starting to see the first implications of this by interconnecting devices. For example, the Twitter/Comcast deal that lets you change the channel on your TV by clicking on a tweet from your computer, tablet, or mobile device is the tip of the iceberg. It doesn’t seem crazy to predict that in the future TV ad buying may look a lot like buying video ads online.
Changes in TV advertising will probably be the slowest out of everything I mention in this post. But you have to remember that TV is still the largest (by spend) and most influential ad medium in the US. So any shift in TV advertising is a pretty huge deal.
Teenage Channels Coming Into Their Own
There are a number of channels, while large, have only been around for a few years. They are growing and changing very quickly. If they are already in a marketer’s arsenal then they are dealing with a lot of changes with many more to come. If these channels aren’t in a marketer’s current arsenal, they almost certainly will be within the next year.
Mobile channels have gotten a bad rap for being limited and ineffective for almost all verticals outside of gaming. My sense though is we are about to see the mobile marketing doors swing wide open. The first step was Google’s latest announcement around deep linking and crawling native apps.
New mobile ad formats that are more effective are launching every month such as Facebook App Install ads and native advertising. New technologies such as Drawbridge,Deeplinks.me, and Yozio fix vital foundational problems that mobile introduced (tracking across multiple devices, deep linking into native apps, and attribution). New initiatives like Facebook’s Purchase Autofill, and Twitter Lead Gen Cards are massively reducing friction for users to take meaningful actions on mobile.
Twitter launched their ad platform last year and has been slowly developing new ad formats and targeting methods. With the IPO looming, Twitter is going to get more aggressive about monetizing similar to how Facebook got more aggressive after their IPO. That means new ad formats, new targeting, new bidding mechanisms, and more. We’ve already seen the start of this with the acquisition of MoPub to extend their data to other publishers, the Comcast deal that lets you change the channel on your TV right from a tweet, and the expansion of lead gen cards.
The Facebook ad platform isn’t exactly new, but it is certainly going through a lot of changes. In the past year we have seen them roll out multiple new major ad types. Ads in the newsfeed, and ads that deep link into your native mobile app. We have also seen them launch Facebook exchange which has enabled retargeting. Facebook is far from done. We will see more new ad types and capabilities in the next two years.
Content marketing has been all the rage primarily in the B2B world the past few years. As the ability to access and use more sophisticated data around content becomes available, companies are becoming more advanced on how they approach content marketing. B2B companies are starting to take a page from Buzzfeed and Bleacher Reports model of heavy optimization around content. Additionally one of the biggest additions to the content marketing world has been the ability to extend your audience through paid promotion networks such as Outbrain, Sharethrough, Triplelift and others.
In addition to major shifts in mature channels, teenage channels starting to come into their own, we have a slew of new ad channels emerging opening up completely new audiences and ad formats. I cover some of these in depth in my series of Growth Tactics You Need To Be Following.
I wrote in detail about the opportunity in native advertising. In short, we have seen major publishers launch native ad formats which is the beginning. But in the past year we have seen native ad networks such as NamoMedia, NativeX, TripleLift, and others launch which is starting to open up even more native ad inventory and formats. The signs are promising as early results on ad performance and publisher monetization is outperforming other channels.
4 New Ad Platforms With Scale
SnapChat is said to be experimenting with native advertising. I expect a roll out in 2014. Pinterest recently revealed the launch of Promoted Pins as their first advertising endeavor. Instagram has started to test native ads within their stream. Foursquare just launched their self serve ad platform. All of these just within the past month!
Mobile Messaging Apps
Mobile messaging apps have massive reach. WeChat and WhatsApp have 236M and 300M MAU’s respectively. To put it into perspective, that is larger than LinkedIn, Twitter, Zynga, FourSquare, or Pinterest. Beyond that there are a slew of messaging apps that are growing fast including MessageMe, Line, Viber, and KaKao. The game Costume party reached 1 Million users in 22 hours just on the messaging platform Kik. WeChat also already has a developer platform. Many of the other messaging platforms will also open up platforms.
Yet To Be Conceived
Beyond the new channels and ad platforms that have just be born, there are a set of things in the horizon that have the potential to be large growth channels.
There is a huge wave of wearable devices that are hitting the market such as Google Glass, smart watches, and quantified self devices (i.e. Jawbone Up). While I don’t think wearables will present the growth opportunities that mobile have, it is certainly an area that could gain large reach among consumers.
What Is Changing At The Foundation?
By this point I have hopefully convinced you that there are a sea of changes in the world of marketing and growth at the moment. In fact I’ve probably missed some major items in my list. What are the underlying reasons for these changes? I think there are 4 primary foundational shifts:
Mobile is undoubtedly the biggest shift in the last 10 years. It is not only opening up new channels, but driving massive change in all existing channels. Mobile is a tidal wave that no one can stop. Mobile should be the most powerful marketing channel that has ever existed. The device is always on us, always connected, captures immense amounts of data, and capable of interactive and engaging experiences. Most importantly there are billions of mobile devices worldwide which is more than any other technology or marketing medium.
2. Merging of Advertising and Content
Native Advertising, Content Marketing, Content Promotion networks. Brands and advertisers have realized the value of using content to help engage the user and deliver their message vs slapping people over the head with it. Some people say this isn’t new, some say it is. I don’t really care. The point is that advertising is merging with content. When you talk to most brands and agencies one of their biggest shifts in budget are to content generation and content promotion. There is no better proof then looking at how Outbrain has exploded from $0 to $130M in revenue and an expected IPO in only a couple years.
3. Always/Everything Connected
Thanks to mobile we are now almost always connected. But beyond mobile our environments and everything we own is becoming connected. Our houses (Nest), cars (Tesla), clothes , accessories (Google Glass, Pebble, etc) and even our gardens and bike locks are becoming connected. This opens up more data about our lives and integration between mediums.
It has become standard that if you are a tech company you have an API. API’s are doing three things in the marketing world. One, opening up access to data. Two, enabling integrations for new growth opportunities. Three, making it possible to automate/program some marketing techniques that were previously too inefficient to do manually with out API’s.
There are two opposing forces at play. On one hand you have efforts such as the elimination of cookies restricting data. But on the other hand you have channels and devices such as mobile and Facebook that open up more data about people than we have ever had. More importantly new tools are making it easier for marketers to capture, analyze, optimize, and use data to guide their customer acquisition efforts. Data and openness will win in the long run.
New Channels/Tactics Create New Opportunities
Overwhelmed with all the change yet? Don’t be. The changes should be exciting for everyone, especially startups. New channels and tactics create new opportunities for those that have the flexibility and risk profile to take advantage early. Change in the marketing ecosystem is only accelerating. So if you take one thing away from this post, it should be this. Adapt or die.