1-10-2014
Following our annual Forecast conference last November in New York, I had a chance to catch up with one of the guest panelists, Alexander Kates. Alex is an executive educator at Rutgers University and co-author of the book Strategic Digital Marketing. He?s also a digital strategist and marketing consultant to big brands, providing guidance and targeted training to executives around the world. And if that?s not enough, Kates is the founder of several companies, including Planga, the Jersey Angels investment group, and GRX Digital.
In your opinion, what should be the one real goal of digital marketing?
Well, what would you say is the goal of marketing more generally? It?s sales, isn?t it? We justify marketing spend by determining it will increase sales more than it will cost our business. Marketing must create a measurable improvement to our bottom line to be worth it.
But when it comes to digital, sometimes we forget. The only goal of digital marketing, like all marketing, is to generate ROI for your brand. Marketing is about getting results ? and it doesn?t matter whether the spending is in digital or traditional channels.
Marketers often use social key performance indicators to measure investments in digital. But let?s be realistic ? do you have any idea how a retweet on Twitter, a like on Facebook, or a share on YouTube is going to affect sales of your product or service? These KPIs are only loosely correlated to sales, if at all. Quite frankly, that?s not good enough. We?re stopping short of where we should.
Digital media is different. Unlike broadcast media, where our audience is fairly anonymous, we have an incredible amount of data from various sources that can be used to identify and measure our audience and their engagement with us. We can track where they came from, and what they do next. We shouldn?t, and can?t, rely on established formulas to estimate sales impact. We have to hold digital marketing to a higher standard. With carefully planned measurement, and with analysis of internal and external data, we can fairly accurately attach real sales numbers to these digital KPIs. This lets us begin to estimate and measure ROI for our digital investments.
We always urge clients to use return on investment as the lowest-level basis for comparison when considering investment proposals. It may not be easy. Early on, it may not even be accurate. But it?s always worth it. It?s the only way rational decisions can be made today. ROI is the ?be all and end all? of all marketing, and probably always will be.
What?s the biggest digital strategy mistake you see companies making?
The biggest mistake that I see across industries is lack of sufficient investment in digital. I believe this is out of fear. Budgets are always tight. Margins are always small. We don?t always have a digital expert on staff to guide us through. Funneling money away from tried-and-true strategies and into untested digital channels is perceived as incredibly risky. Brands justify their lack of digital strategy by saying they ?can?t afford it.?
That?s certainly the simplest short-term solution, but represents the greatest risk of all to our brands. Fast-forward five years from now. If you aren?t making investments in digital ? if you aren?t testing the waters today ? it will be too late for your company. The question we should be asking ourselves is: Can we afford not to do it?
That brings me to what I believe is the second-biggest mistake companies make in executing digital: They allocate fixed budgets for digital channels without proper strategy or measurement plans.
We read articles, see infographics, and hear experts talk about how consumers are changing. We know digital is becoming important, and throw money into it to allay our fears that we?re falling behind. This is simply wrong. Digital strategies must be constantly tested, refined, and reworked. They represent ongoing investments that are funded incrementally based on results. Partnering with an agency to develop something and then just forgetting about it doesn?t get us very far. We have to change our mindset when we think about digital, to embrace a ?test and learn? culture. It?s the only way we can become proficient in digital and out-compete our rivals.
You teach a course on creative viral marketing that helps managers leverage content. How could radio managers take better advantage of their enormous content assets in the digital arena?
Radio, and all broadcast media for that matter, is changing. We?re increasingly living in an on-demand world, where consumers are constantly connected to streaming content wherever they go. It?s this new world to which broadcast media companies must adapt.
That said, the heart of all media is content. It?s the common thread between traditional and digital media that brings value to the advertising alongside it. The only difference between traditional and digital media is how the content is distributed. The good news for radio is that it has an incredible amount of excellent content ? extremely relevant, hyper-local, top-quality content.
The bad news ? or, rather, the great opportunity, should you choose to view it that way ? is that companies must leverage this content through new channels to continue creating value for listeners and advertisers.
For instance, there is some radio content that could be enjoyed universally, that isn?t specific to a time or geography. This content could be modularized, organized, and made easy to access from anywhere at any time. It can include intelligence, to help listeners discover audio content they might enjoy. Clips could also be made sharable to perpetuate through social channels. Think Netflix for radio shows.
Even local content that?s time- and place-specific has its place in today?s world. For instance, my Android phone (via Google Now) already knows that I?m travelling to Milwaukee this evening. It provides me with text weather forecasts and local news articles. What it doesn?t provide is nearly live, on-demand forecasts and news from Milwaukee broadcasters. I should be able to listen to relevant clips from the last half hour at the touch of my smartphone screen. This is definitely an opportunity ? and I believe it?s just the tip of the iceberg.
What have you found to be the most important traits of successful digital leadership? How do they compare to traditional leadership qualities?
I believe the traits that make an excellent business leader also make for a successful digital leader. He or she must be charismatic, driven, forward-thinking, and willing to lead by example. That said, I do believe that there are certain traits the best digital leaders within organizations possess.
For starters, great digital leaders never accept the status quo ? even if an industry has operated a certain way for many decades. They strive for an idealized vision of their entire company, beyond just their department or business unit. Many colleagues will snicker at their visions of grandeur that seem all but impossible ? and yet they persevere. They never take no for an answer when it comes to technological or logistical hurdles. They never let people with more traditional mindsets deter them.
Digital leaders do their best to stay abreast of the way technology is changing our world. However, what is even more indicative of this archetype is the realization that they always have a lot to learn. They are perpetual students. They realize that as quickly as the world is evolving, they absolutely cannot know everything. They?re not afraid to seek help outside the company, and realize that these partners too are still learning.
Lastly, digital leaders are masters in taking calculated risks. They?re not afraid to make investments that might result in subpar immediate results. They?re willing to test almost anything, as long as success or failure can be determined quickly. They rely on data ? the quantifiable results of their tests ? to drive their decisions. Digital leaders never guess. They test, refine, and retest until their wild ideas find their mark. They are always willing to accept short-term losses to find long-term success.
Looking to the future, what do you see as the biggest challenge to digital marketing?
Given the way that technology is evolving, there are a number of great challenges that will arise for companies over the next few years. To be frank, at present radio is so far behind in digital that discussing future digital hurdles is irrelevant. Right now, our own mindset and inability to think outside the box are the greatest digital hurdles. Many of the more exciting ideas I?ve been talking to radio companies about are possible with today?s technology ? it?s the existing procedures, organizational structures, and inability to take big risks that are standing in the way.
If you ran a radio company, how would you approach digital marketing strategy for your stations?
When it comes to digital, there are some strategies that are fairly easy to move on quickly. These are the things every radio company should be doing, at a bare minimum. The first is establishing a set of best practices and procedures for digital channels. This would include guidelines for station websites, such as their design, user interface, optimization for search engines, and ease of mobile access. It would also include rules for blogging, e-mail, and SMS campaigns, and interactions in social channels like Facebook and Twitter. Detailed plans for investing in all of these platforms, including the cultivation of partners to develop and maintain the platforms when needed, is essential.
Beyond that, I would begin investing heavily in developing new ways to distribute our stations? content. I?d focus on acquiring enabling technologies and partnerships to make that happen. The technology exists today to allow relevant audio content to be distributed on-demand to the right audience at the right time. Even at the cost of shouldering investments without immediate return, I would be hell-bent on the singular goal of maximizing content distribution via online channels. Actually, it?s likely I would invest in the development of a platform that would do just that: unifying partners across geographies and station types to create a single point of on-demand audio consumption. The company able to do this, whether it comes from within the radio industry or outside of it, will be able to create immense value for itself. It will also give radio new life in this digital age ? though it?s debatable whether one would call an on-demand audio platform radio at all.
We tend to ask what digital can do for radio. What can radio do to make digital strategies more effective?
I?m so glad you asked. Broadcast media has another immense strength beyond its excellent content. Even as consumers increasingly flock to on-demand media, numbers still show that there is no more cost-effective way to reach large numbers of people than radio. Stations and radio shows can invite potential customers to like on Facebook and tweet (via hashtags) on Twitter to jump-start social campaigns. Many TV shows, such as The Voice and X Factor, have leveraged their massive viewership to create immense buzz in social channels, further extending the reach of their content and brands. Advertisers too can use radio to funnel listeners into further engagement via social media. For instance, one might utilize the reach of radio to drive immense traffic to a Facebook contest. It?s a great way to build a digital presence. It also develops an intimately engaged and interactive community of loyal station or brand enthusiasts. The end result of a strong digital presence will be new revenue opportunities, as well as more broadcast listeners.
To a large degree, it isn?t that social media is displacing radio. In fact, quite the opposite is happening. Radio provides media efficiency that no social channel can match. The strengths of one media type compensate for the weaknesses of the other, and two types of media thrive in perfect harmony. When utilized effectively, broadcast radio and digital media have a symbiotic relationship that?s far greater than the sum of its parts.
Deborah Parenti is EVP/Radio for Streamline Publishing. E-mail: parenti@aol.com.
(1/10/2014 3:59:33 PM)
Then, I would think about it! LOL!
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