The second wave of digital is breaking
by Luke Mckend (@lmckend) Too often, we in the digital media industry have reduced the conversation about digital transformation to one about shifting budgets from one flavour of digital media to another, rather than a deeper understanding of what this digital transformation really means for a business.
The digital media space has exploded, providing brands and publishers with exponentially more real estate in which to advertise and get their messaging across. The use of cellular telephony has also exploded — 50% of South African adults today are online and own a smartphone. Online retail, or ecommerce, has grown by over 20% year-on-year for the past 16 years, according to research by World Wide Worx, and annual sales have now hit around R9bn. And then there’s the internet of things (IoT) — an expanding number of connected devices that gather and transmit data — from smart appliances, to watches and fitness trackers.
Rapidly evolving landscape
What does this all add up to? A rapidly evolving landscape for advertising execs to navigate and understand.
We interact digitally hundreds of times every day, and some of those provide an opportunity for brands to engage us with relevant and useful information. Each of these engagements with a consumer allows a brand to start building a profile of that person. As a brand gathers more and more data on a given consumer, it may leverage the insights the data provides to more accurately engage them — or so the theory goes.
The lack of interrogating what digital transformation really means for business has resulted in a growing sense of frustration from clients and content creators alike, who both sense that they are being short-changed in the process. The recent suggestion from the world’s biggest advertiser, Proctor & Gamble, that digital media needs to grow up is a clear example of the pressure that’s going to come digital media’s way.
Too little focus on impact
Digital is great for generating activity — and, for clients interested in big numbers, it’s hard to argue with the hundreds of millions of impressions and tens of thousands of clicks, views and likes that are available to buy. Unfortunately, for all the measurable activity, there is far too little focus on impact in the form of value created for customers — whether it be in the form of actual sales, or any other measurable attribute.
And, when metrics are reported, there is often confusion, especially when comparing different media sources: Does an impression mean the ad was actually seen? Are all video views equal? Was my ad seen by someone I care about (or who cares about my product or service?). Many of these questions are simply ignored or answered by columns in Excel spreadsheets masquerading as analysis with no actionable insight.
One of the reasons for this is that the first wave of digitisation has been driven by consumer technology and consumption of information. The second wave is now being led by businesses which are leveraging the deluge of information that’s been created by connected people interacting with friends, colleagues, businesses etc, as well as by increasingly connected systems (think supply chains), as well as more and more connected devices.
Technology has provided new means to engage consumers; it now needs to be used to show how value is created for brands by using those platforms. The second wave of digital is breaking.
Luke Mckend (@lmckend) is country director of Google South Africa.
“Motive” is a by-invitation-only column on MarkLives.com. Contributors are picked by the editors but generally don’t form part of our regular columnist lineup, unless the topic is off-column.