Why cross-media buys are a challenge

It seems that every day there’s an optimistic new forecast released about online ad revenue, at a time when traditional media are struggling. But what those outlooks don’t say is that the increasing number of media options can prove difficult for agencies to balance. A new study from STRATA, which produces media buying and selling software, finds that 76 percent of agencies surveyed use at least three media per ad campaign. Twenty-two percent of those agencies say that balancing that mix is a challenge. They cite questions about return on investment and how to achieve the very best media mix. Still, they foresee adding even more new media to their plans in coming years. Almost a third said that they expect to spend more on digital than traditional media within the next one to three years. As for what online media they will spend on, 80 percent said display, 71 percent said search and 52 percent said social media. John Shelton, chief executive officer at STRATA, talks to Media Life about optimal media mixes, why this isn’t a new issue, and what media buyers and planners foresee for 2013 ad spending.

What sort of ROI and media mix challenges has the increase in digital and social media presented for agencies? How are agencies addressing this issue?

Dating back to the beginning of 2011, measuring ROI was deemed by agencies to be the biggest challenge in measuring the success of a campaign, followed by figuring out how to set the measurement criteria for a campaign. One thing is for certain, more and more advertisers are struggling to find a solid mix to get their messages out about products and services.

They approach the masses with television (for example) and then follow-up with some banner advertising or direct people to their web site or Facebook pages for more information.

Often a web site or Facebook page just “feeds the faithful”–those people who are already fans of the product. Unless there is a direct call to action, product offer or payoff for the consumer, a lot of what they are doing is just branding and it may be hard to judge a true ROI. That does present a challenge, so these newer mediums need to be used wisely.

Not to say that digital and social aren’t decent options, they are a wonderful way to extend new information to a targeted segment and stay connected. Our study showed that 50 percent of our agencies say they plan to expand their advertising to new mediums in 2013.

Many advertisers are realizing that they need to use an integrated campaign to get the most out of their ad dollars. The big question for many–how do I do that and guarantee the best use of my campaign budget?

Do you think agencies anticipated such issues when they began adding digital and social media to their mixes? Why or why not?

Because digital and social went from being a buzz to implemented and vital part of a campaign in such a short amount of time, many agencies were learning on the fly.

So, no many didn’t anticipate the issues dealing with a unique media mix have provided. Seventy-six percent of the agencies we polled use at least three advertising avenues when placing a campaign. So, the good news is that a majority of agencies are meeting these challenges head on and embracing new options.

Are these challenges unique to digital media, or are they issues across all cross-platform campaigns?

This really isn’t new.

Print experienced this when radio came along. Radio felt these growing pains when TV entered the picture, and then TV felt them when cable came on the scene and so on. The only difference is that there are more options than ever before and the challenge of finding that sweet spot for the advertiser has become more of a struggle.

How has advertisers’ interest in the different subcategories of digital evolved over the past year or two?

We have noticed a definite shift over the years with digital.

The primary subcategory in digital has always been online display. But after that, there has been a jockeying for position between search and social. Over the last couple of years mobile has gotten into the conversation a bit more and an area that is growing is digital video. All of these subcategories have become splintered as well, so the focus continues to shift to “sub”-subcategories, if you will.

Why do agencies expect to spend more on digital than traditional media within one to three years? Do you think that’s a realistic expectation?

As I mentioned earlier, digital does encompass a lot of different areas (mobile, social, video, etc.), so the dollars continue to be spread over this area. It is a targeted medium, so traditional media will not go away, but agencies are finding their clients focusing more on digital than ever before.

While a campaign may launch on TV, it then may include banner ads, microsites, digital video, Facebook elements, mobile apps and such. Those fragmented digital options do add up. The media itself may not be as expensive to buy, but the cost and effort to manage and react makes it a challenge.

Is it realistic that it will completely overtake traditional? In my opinion, no, but what I do see is a more diverse media mix becoming more prevalent in agencies’ buying patterns.

What sort of expectations for 2013 advertising do agencies have? Why?

In data we gathered from our STRATA systems earlier in January, we did notice that ad buying was up 3 to 5 percent over last year.

Optimism is definitely there as nearly all agencies expect their staff to either remain the same or even add staff this year–29 percent plan on hiring. Over a third of our agencies expect the first half of the year to be better than the last half of 2012.

We expect that the auto, home and financial industries are going to make a strong resurgence in 2013 to lead an uptick in advertising and fill the void left by political advertising.

Tags: 2013, agencies, campaign, challenges, cross media, cross media advertising, digital advertising, media, online, research, roi, social media, strata, surveys, traditional advertising