Digital Marketing - Intro

Digital Marketing – Introduction

What is digital Marketing?

Digital marketing is a effort which basically communicates/distribute a message to help people form an opinion about a product/service on digitally connected devices such as mobile phone, computer, etc.

Digital marketing contains search engine marketing (SEM) , Search engine optimisation, social media optimisation, social media ads, display ads, email marketing, content marketing.

History of digital marketing

Digital marketing in 1980’s

Digital marketing have been around since 1980’s. However the term “digital marketing” could be subjective with respect to time. For example, IBM launched personal computers in 1981. Even in 1980’s computers were good enough to store large amount of data. In marketing context, large volume of customer sales data, consumer behavior data.

In 1980’s it was all about storing the data. Hence the popular term “data marketing” is a buzzword of marketing in 1980’s. However the practice of storing customer data led to development of the “customer relationship management” CRM software.

Digital marketing in 1990’s

CRM laid the foundation for the core digital marketing activities in 1990’s. One of the core activity is – sales force automation’s. You may have experienced sale force automation in your life many times but you didn’t know.  

Whenever you signed up for a car dealership, seeked customer support – all these have sales force automation to help customer in a effective and seamless ways.

Many large companies now, started then. Few examples oracle, sales-force, etc.

One of the foundations of digital marketing was laid in 1990’s is internet.

Digital marketing in 2000’s

Digital marketing in 2000’s followed same trend as before.Major digital marketing activities are centered around the internet and web. With the likes of google, Facebook, twitter & LinkedIn users get plenty of web experiences they never had before.

Also the rise of smartphone means shift in the digital marketing. Even google moved from web first to mobile first in the later years of the decade. Social media was also a digital marketing buzzword for the host of reasons.

Digital Marketing Since 2010

Before 2010, people are known as tech savvy people. But since 2010 people became dependent of technology. It’s no longer an option, it’s a mandatory. Think about a life without: google, google maps, uber, swiggy, YouTube, Facebook.

Also denser internet coverage means, hyper local marketing have also played the part in digital marketing. Rise of AI thanks to google. In the future of digital marketing the Artificial intelligence would be an integral part .

Initial Days of google ads

As of writing this, Google is worth 700 Billion dollars. But in 2000 hardly anyone though google would reach a market valuation like now. Even search engines aren’t considered as viable business.

In 2000’s attractive business are portals such as yahoo & eol. Advertising was generating back then with a difference. The famous ad type was – banner. Now it could be video or text ad.  

In 2000’s google experimented with ads but they didn’t build a site like google adwords or google ads. They sold ads via sales rep and the ad inventory was sold based on CPM model. Cost per thousand impressions. Imagine!.  This didn’t work as they incurred loss for google.

In 2000 google and yahoo had fierce competition on ads,email and everything else that is internet. At this time, goto.com is the search engine that has invented pay per click ads business model.

And then in 2001 google introduced adwords, and taken inspiration from goto.com and introduced pay per click into google adwords. However google did one breakthrough innovation that attributed to now gorilla market cap.

In goto.com pay per clicks, whoever paid high bid, will be taking the first spot, irrespective of ad quality. So it was difficult for a small yet quality company to compete with larger company. Whoever has a deeper pocket wins the first position- this was a problem rather a important problem.

Google figured, if the new formula. First position = Ad relevance * Bid Amount  . In this way google made money, advertisers made money, users got a very relevant information.- This innovation became a game changer for google. Now it may seem obvious but it was implemented 18 years ago!

Another masterstroke in that put google further ahead is the introduction of pagerank in early 2000’s.

Initial Days of Facebook ads

Compared to google or google ads Facebook still have a longer way to go in terms of overall platform level ROI, etc.  It’s just a decade since the introduction of Facebook. Compared with google, in 2 years, it would be 2 decades.

Facebook Flyer

In its initial days, Facebook was much leaner, less static than google.  Facebook’s first advertisement for example, was used to be a “flyer” type ad. This flyer will be put on the Facebook homepage which was controlled by Facebook. Flyer per day cost about $10-40. Mostly students advertised parties and other social events and small business targeted college students. This is how Facebook generated most of the revenue of the year.

Flyer Pro

Later Facebook changed, CPC business model was incorporated into flyers and then called it flyer bro. With cost per click model, advertisers can be set what is the maximum they are willing to pay for the click. They also had a bit of targeting options such as gender, age, location,political views, education, relationship status, workplace.

This is all happened when Facebook was still called THEFACEBOOK.COM

Ad Salesman

After these successful stint, Facebook has confident on the ads and hires a first fulltime ad salesman for the company. He brings in party poker as a ad client. Facebook is making a revenue of $60,000 per month based on the cost per acquisition model. If you’re wondering what is the CPA ( cost per acquisition) , advertiser will pay whenever he’s acquired a user/lead/purchase from the platform.

However, the party poker success was short lived, owing to the fact that online poker became illegal in USA.

Apple

After party poker, apply becomes a major ad client for the Facebook with the same CPA model. With this CPA model, whenever apple gets a new member in apple’s Facebook group, Facebook will pay $1 for each user. This way Facebook was able to make a few hundred thousand dollars per month.

Another big company Victoria secret comes for the same campaign objective and spends upto $25000 per month.

After this Facebook opens for all people above 13 age to have an account.

In 2009, Facebook launches geographical targeting and language based targeting to onboard many advertisers possible to the platform. They have also introduced commercial entity called pages and a user can create pages, manage on his own and also advertise.

In 2010, Facebook introduces new feed ads, which is one of the dominant ad type soon to be surpassed by the stories. In 2 years, Facebook launches the same for the mobile devices. Later Facebook introduces open graph which can be used by advertisers, app developers.

In 2013 Facebook uses lookalike audiences which uses machine learning techniques to clone relevant users based on the action or data provided by the advertiser.

Digital Marketing Vs Traditional Marketing ( offline Marketing)

No article introduction article about digital marketing is complete without comparing it with traditional marketing, so here’s my comparison.

Measurability

“ What gets measured gets done.” – anonymous.

Measurability is one of the core elements of digital marketing that put miles head of traditional or offline marketing. In the early days of google adwords, which used user relevance as a key factor in determining first position of ads. However to measure relevance you need some data or metric. Google used click through rate (CTR) as a key metric of measure relevancy.

This turned out a breakthrough innovation for google and digital marketing. However traditional marketing lacks such framework.

Measurability is certainly a great aspect of digital marketing. With likes of google adwords and google analytics it’s getting much better.

Long term Exposure

Obviously digital marketing is an easy winner if you consider long term effects of your marketing efforts. With the rise of search engine optimization and content marketing , once you done it right, you can reap benefits for long time.

Long term effects in digital marketing is an inherent advantage – arise of digital devices and platforms & thanks to Moore’s law , made it ridiculously cheaper to connect, spread a message on internet using digital devices. Seems like Moore’s law doesn’t contribute much to offline marketing.

Targeting Options

It’s incredibly hard to targeting people accurately on online. It’s even gets tougher in offline. You’re more likely to engage with a website, app or a digital property than a salesman in trade show.

Also, data collection by the major companies, provides advertisers plenty of options on targeting the desired audience online. On the larger scale, digital marketing wins over traditional marketing in this.

Realtime Results

Thanks to internet and Moore’s law, data travels upto the speed of light in digital mediums. Which means it’s takes few minutes to start a campaign using a computer. You can literally reach a large scale of users within a span of minutes. When compared with offline medium, digital is exponentially fast in transmitting a message.

Newspaper is as fast a newspaper guy, billboard takes a week to setup. Tv & radio got speed of digital but with lack of targeting and measurability.

Cost Effectiveness

When it comes to cost, digital marketing is the obvious winner. Due to cheaper cost to distribute a message across in digital space. Creating, designing and distributing a physical advertisement such a pamphlet takes a lot of money and effort. Also, it’s costlier if you want to make any changes after printing creatives.

With digital you have little infinitesimal cost in design, creation & distribution of a advertisement.

Agility ( Test and Improve )

This is one of the underutilized in digital marketing. Digital marketing gives the ability to test ad creatives in real time. It’s easy to test & measure what works in digital marketing. With offline marketing it’s not possible to A/B testing.

Budget Spend – Digital vs Traditional

It is estimated that the digital marketing spend will be $100 Billion dollars globally in 2018-2019. Though the exact numbers for the traditional marketing is not available, according to a survey of CMO, it shows a decline.

Since 2017, Advertisement money spent on internet will be greater than the money spend to advertise on television ( TV)

Source : Recode.Net

Scope of digital marketing

Digital marketing spend is expected to triple by 2022. Digital marketing is still growing and has a wider scope. Here’s the few roles you can take in the digital marketing

Digital Marketing Manager

Probably juggling all aspects of digital marketing. This nature of job includes, leadership, technological expertise, strategy, planning, execution , reporting and coordination with other teams. Generally, a person requires some level of prior experience before this role.

Content Marketer

Content marketing implies creation of various content formats such as text content, e-books, video, images, podcast, whitepapers & research. If you have a love for writing or content creation then you can incorporate digital marketing knowledge to become a content marketer. Or if you’re coming from arts or media background, experience can be quite useful because this role needs some level of creativity.

Social Media Marketing

This involves use of social media for various marketing objectives. For example, you can use facebook as an engagement platform or use it for lead generation or sales campaign. One should be aware of the pulse of social media platforms and know-how’s on how to run ads, etc.

Search Engine Marketer

This involves creating ad campaigns on search engines such as google, bing and other platforms. Search engine marketing involves two aspects : search engine optimisation & pay per click.  Search engine optimisation is also called as organic seo where marketer helps in creation of content which is easily readable and understood by search engine to rank well.

The pay-per click is a paid ads. Where you will creating campaigns based on keywords with various match types and bid for a maximum cpc. Usually the pay per click campaigns will be part of revenue generation campaigns.

Web Analytics/ Data analytics

This involves analyzing a lots of data to get insights that can benefit business. One of the biggest advantage of digital marketing is data. Right from analyzing how banner influences sales, to how website speed improves user experience , Analytics is an interesting job to take up!

About the Author: yathav

I'm very passionate about technology, marketing & analytics. Using WordPress and working on blogging & search engine optimization for almost 8+ years, I'd like to share my thoughts, hacks and best practices about what i do professionally & what I experience.

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