With these new trends and opportunities in digital advertising, smaller brands have a sporting chance against the giants in 2018.
In 2017, Advertising Age reported that digital advertising spends surpassed TV for the first time. The explosion of digital – including its rapidly changing opportunities and challenges – will give challenger brands more than a puncher's chance to become champions in 2018.
Companies such as Coca-Cola, L'Oréal and Nike are the current heavyweight champions of their respective industries. Does that mean all other brands should concede and head home?
The answer is an emphatic no. Challenger brands that leverage cutting-edge advertising trends and technologies will be able to overcome deficits in infrastructure, budget and manpower on unprecedented levels in 2018.
In 2017, brands were subjected to record fraud, high levels of invalid traffic and the "race to the bottom" on programmatic open exchanges, which showed that challenger brands operating on slimmer margins need to be smarter and more efficient.
As the CEO of PK4 Media, I recognize that some of our bigger clients can afford these inefficiencies but should not have to. However, it is critical that challenger brands avoid these pitfalls if they want to gain market share.
Here are three digital advertising trends that will turn challenger brands into champions in 2018.
1. Agency consolidation: Avoid too many cooks in the kitchen
2017 problem: Many brands retained multiple media agencies for their advertising needs – one for broadcast, another for social media, a third for digital, another for out-of-home and so on. The problem with this method is these agencies view each other as competition. Therefore, they work in silos, do not cooperate and have their own data, making it impossible for brands to measure the effectiveness of their various campaigns. Bottom line – this is not in the best interest of the brand.
2018 solution: With an omnichannel strategy, brands can better achieve what everyone has been talking about for the last few years – the need to create a seamless customer experience across all channels. By using one agency to run campaigns across all channels, brands can understand through consistent measurement which channels are performing well, which enables them to optimize on the fly and maximize their return on advertising spend. Consolidation also fosters collaboration; eliminates hidden fees, fraud and waste; and creates the efficiencies needed for David to compete against Goliath.
2. Double down on DOOH: Just don't bet it all
2017 problem: Digitial out-of-home (DOOH) advertising did not have many problems in 2017. In fact, it had a breakout year. Ad Age reports that DOOH spending in the U.S. is expected to increase to nearly $4.5 billion by 2019, which is an increase of approximately $1.2 billion from 2016. The problem comes if brands focus too heavily on this growth area and neglect other channels.
2018 solution: Companies without a DOOH strategy in 2018 will have a failed strategy. The rise of smart cities offers enormous opportunity for advertisers. However, brands must measure their DOOH spend proportionately with other channels. According to Gartner Research, ad campaigns that integrate four or more channels outperform single- or dual-channel campaigns by 300 percent. Incorporating growth channels such as connected TV and DOOH is critical, but it must be incorporated into a comprehensive strategy. Remember, customers demand a seamless customer journey.
3. Transparency: Necessary to play the perfect game
2017 problem: Ad fraud reached record levels of $16 billion. Nearly 30 percent of the $27 billion spent on programmatic open exchanges was on invalid traffic (IVT). Large advertising agencies with in-house exchanges charge hidden fees.
2018 solution: When USA Hockey beat the Soviet Union in 1980, they played the perfect game. In the movie "Miracle," Kurt Russell, playing Coach Herb Brooks, famously said, "If we played them 10 times, they may win nine." To play the perfect game, challenger brands need to demand transparency in terms of data, campaign performance measurement, fraud, IVT and hidden fees. While industry leaders can afford some inefficiencies, challengers must play the perfect game to win.
No other industry is changing as rapidly year over year as the digital advertising and marketing landscape. Challenger brands that understand the mistakes of 2017 and the trends to get ahead of will be able to challenge the champions in 2018.