ArticleThe *not* so Digital Download
While I spend an inordinate amount of time thinking about (and doing) digital advertising, it feels like things have swung too far in the “digital” direction. Everyone (seemingly) is doing digital advertising while eschewing other channels + tactics. As a digital marketer, I’m thrilled to see widespread adoption and acceptance of digital channels and tactics; as an investor, I can’t help but to see a massive opportunity to zig while everyone else zags.
So, for today’s issue, I want to take off the digital hat and focus on the opportunities present in channels that have experienced (and/or are experiencing) outflows of advertising dollars, along with some of the neat innovations that most media buyers might not be aware exist on these “legacy” platforms.
TV
There are no two ways about it: TV is still a thing. Despite the rise of streaming, the increase in “cord-cutting” and the surge in digital video networks, TV remains a revenue-driving force in the right contexts. In fact, when I speak with brands spending upwards of $250k per month on Meta Advertising, the first thing I ask is if they’ve tested TV – not only is it a brilliant complement to your existing Meta & Google Ads accounts (it tends to create a “halo” effect), but TV can also unlock new customer pools (particularly among older demos, which tend to have the most spending power) and serve as a hedge against algorithmically-driven CPMs.
Unlike Meta and YouTube, where digital ad platforms algorithmically determine your effective CPM based on your expected creative performance, expected action rates and the number of other advertisers bidding for that placement, TV ad spots are priced in advance and set by the channel/network. Once you have the spot, you have the spot – and if more people tune in than expected, more people tuned in. It’s the advertising equivalent of a “bank error in your favor”.
In addition to the above tremendous, usually-quantifiable benefits, perhaps the greatest edge a brand can gain from TV is the fact that you’re advertising on TV. There’s a certain prestige and perception associated with TV advertisers – an intangible benefit that has seen a steep increase in value as fewer and fewer brands continue to use it.
The final point on TV is this: TV today isn’t what it once was. The old days of channel-specific sales reps and convoluted media buying and over-reliance on oft-outdated “viewership” profiles are gone. TV advertising is looking more and more like programmatic advertising – and that’s objectively a good thing. I see this innovation manifesting in 4 core ways:
- Inventory – the single-greatest barrier to entry in TV has always been access to inventory. Historically, you needed a rep or broker to provide availability on a channel-by-channel basis, then pull audience profiles for each channel, calculate expected viewership, and (finally) attempt to normalize each potential spot in order to get to a true, apples-to-apples comparison. All of this typically required weeks or months of planning, and was a fraught and frustrating process – by the time you figured out which spots you actually wanted, there was no guarantee that they were still available. Fortunately, there are a number of platforms coming online that have brought much-needed innovation into the TV space: Charter, WideOrbit & Tatari (among others!) are bringing a DSP-style experience to linear TV – giving media buyers the ability to browse & book open slots across hundreds of networks, upload creative content, and launch campaigns in minutes to hours. While it doesn’t cover anything (particularly local networks, which have been slow to adopt it and often lack the infrastructure to integrate with digital-first platforms), it is a massive step forward in accessibility and real-time purchasing. There’s nothing better than being able to take a top-performing Meta Ad and transform it into a targeted TV commercial.
- Targeting – Speaking of targeting, all of the above digital TV buying platforms layer on first, second & third party audience data – so instead of having to crunch Nielsen reports to figure out which channel is right for your brand, you can simply create a target audience profile and the platform will show you which networks over- and under-index for that specific target. It is very much analogous to what DSPs provide for digital ad placements – and very much a welcome improvement for TV media buyers everywhere. There’s nothing cooler than being able to upload your target audience, website and/or customer data to a TV platform, see which networks and programs those people tend to watch, and book slots from a single interface.
- Creative – The other primary blocker for TV advertisers has been the actual cost of the spot – a single 0:30 spot can cost in hundreds of thousands or even millions of dollars. While there’s not an automated solution for that, having a single interface allows you to do cool things, like identify your top-performing YouTube and Meta videos & run those for your TV spots, or stitch together individual UGC/review videos using FinalCutPro (or something similar). Neither is a perfect solution, but both allow you to leverage your existing assets to support a new channel – getting you advertising (and learning) faster.
- Measurement – Finally, there’s measurement. Historically, this has been challenging for TV (even direct response TV) – but this is an area where advancements in LLMs and aMMMs can come to the rescue. It’s no secret I’m a huge proponent of tools like Meta’s ROBYN – which allows anyone to create an automated MMM in hours (vs. months), customize it for different ad stocks, and understand exactly what is driving outcomes.
Finally – and just like DSPs – these platforms above also have their own website pixels (similar to the Meta pixel), which can provide data on audience behavior and performance (similar to what you’d get from TripleWhale or Northbeam or any 3P attribution tool). While none of these are great (and you should 100% invest in an aMMM solution, especially given how cheap they are to spin up – think <$25k, which pays for itself in a month if you’re spending >$250k and it improves performance just 10%), they are a major step forward from the days of getting impression and reach numbers.
The simple fact is that there are fewer TV advertisers today than there were just 5-7 years ago, despite the fact that there are more (and bigger) TVs in just about every US home. Those two factors, coupled with the gradual shift in ad placement from reps to platforms (which is much, much cheaper for TV networks – those sales commissions are EXPENSIVE!) has resulted in flat-to-declining CPMs in many markets.
As an example, we recently did an ad buy for a local client, and were able to snag multiple prime spots during Thursday Night Football & the Christmas Day NFL Game for a CPM of ~$23.80 – which is extraordinarily competitive vs. Meta during the same periods (BFCM + Christmas). We’ve also managed to secure spots around other high-profile national and local events for less than $10 per spot (CPM of ~$2). My point: if you know where to look, you can get a tremendous bang-for-your-buck on TV.
Direct Mail
Direct Mail is the OG DM – and for good reason: it works. Everyone likes getting mail. We still work with multiple brands that spend significant amounts on direct mail, and the lift we see in conversion and sales from direct mail is real – you can pretty much tell when and where a piece drops just by looking at the website analytics. The blockers are the same as they were before: data availability (getting those lists can be expensive) and the cost/waste ratio – any time you send a relatively large mailing, you know there’s a significant amount of waste (sending to the wrong address, sending multiple pieces of the same address, etc.).
Again – there’s no question that direct mail can work. There’s a reason some of the most successful companies in the country have it as an integral part of their marketing mix. But I do think there are opportunities to use it smarter.
The concept I’ve been playing with of late – and where I think there’s a HUGE opportunity – is stacking generative AI/ LLMs + customer data + print-on-demand services to create personalized, “oh wow” experiences.
As an example, imagine you’re looking for a Holiday light installation service. You browse Google, find one, fill out a lead form (including your address), and wait for a call. Then, a few days later, you get a card in the mail with a mock-up of your house with lights, along with a hand-written note from someone at the light hanging company thanking you for your interest and sharing some nice, seemingly-personal details about how they’d love to help make your holiday magical. Pretty cool, right?
All of that is not only possible, it’s relatively easy to do:
- Data pipelines like Zapier make getting data from a lead form into a LLM-friendly format as easy as dragging-and-dropping it.
- Data augmentation providers are quite good; Jolie can turn a zip code into a water report; the Google Places API & Zillow API (among others!) can take an address and automatically return a photo of a property from MLS listings, public records and/or Google Maps data, along with the home value (to give you an idea of affluence) and dozens of other data points.
- LLMs are quite good at taking basic inputs and crafting branded responses within reasonable parameters – Recart was among the first to demonstrate how this can work with their AI-driven SMS, but there’s nothing stopping you from using a GPT integration to Google Sheets to customize a letter for each lead. That customization can be based on anything – from the data in a water report to the page/service(s) requested on a lead form, to the value of home provided in an address field.
- Scribd, Handwrite and RoboQuill (among others) provide print-on-demand services using real pens operated by machines (which is just cool) – they can typically turn around a letter in hours-to-days, and do so quite affordably ($1.50 – $5.00 per card, depending on the amount of text, materials, etc.).
The beauty is that each of the above platforms can easily be linked together – creating a direct mail experience that perfectly ties into your customer/nurture journey. This isn’t right for every brand, but for those with a sufficiently high AOV and significant reliance on nurturing and experience (senior care, home services, luxury items, cars, insurance, realtors and financial services all come to mind), this can provide a significant boost to lead close rates.
Billboards & Out-Of-Home
The final tactic I’m excited about is (and I really, truly can’t believe I’m writing this) billboards + out-of-home. I recently had the opportunity to test out Basis’ new programmatic OOH buying tool, and (again, can’t believe it) – I’m a fan.
In essence, this is doing to digital billboards (and other digital OOH placements, like bus shelters, public place signage (arenas, airports, train stations, etc.) and point-of-purchase screens) what platforms like Charter, Tatari and WideOrbit are doing to TV: opening up inventory to a broader market, losing the annoying reps, and making the placement of real-world billboard advertisements as easy as the placement of digital ads.
The ability to dynamically adjust your creative across different placements, attribute leads/sales and scale up-or-down your buys from a single interface is awesome – but the big advantages come from the medium itself:
- No Ad Blockers – ad blockers for the human eye don’t exist (at least, not yet) – so if a person is in a place where your ad is being shown on a OOH screen, they’re going to see it. Whether they remember it is a different question – but they will see it.
- Privacy-Friendly – All OOH placements are inherently privacy friendly; no personal data is used to place them and all targeting is anonymized.
- Reach Your Audience At Critical Points – one of the major challenges of digital ads is reaching customers at the exact right moment; OOH/Billboard ads don’t have that problem. If you’re trying to reach customers who are buying widgets, a DOOH billboard at the widget store is going to reach those people when they’re buying widgets; if you’re trying to reach people who are traveling, DOOH billboards at airports are going to do exactly that. Again, there’s still the challenge of converting visibility to recall – but at least you have the right person / right time parts locked down.
- Scale – the right digital billboards/signage can reach hundreds of thousands to millions of interested people at a fantastically low CPM (in some tests, I was being quoted $0.80 CPMs – that’s….insane). The ability to scale up visibility and placements is a game-changer for advertisers who are otherwise audience constrained.
- Specificity – I’m a fan of niches. If I wanted to buy billboards in El Paso, Texas (for reasons), I’d ordinarily have to do a LOT of legwork, or eat a hefty markup from a company like Lamar. But with programmatic Out of Home, I can put in a zip code, see all of the options available in that area, view the actual asset, see the locations on a map, and book spots – all from my desk. No pushy sales calls or waiting around for “estimates” and “last-minute deals” – just straightforward, no-nonsense, transparent CPMs.
Billboards/Out Of Home have suffered from the same outflow of advertising dollars that has plagued TV – more brands are turning more of their budget to digital channels. And like all markets, when demand dries up while supply remains constant (or increases), prices decrease. That’s what’s happened here. The combination of lower prices + increased access has created an interesting opportunity for creative advertisers – if you’re game to try it.
There are many more interesting opportunities out there that have my curiosity, but these three have my interest. So, as you’re doing your 2024 marketing strategy planning, give them a look – you might just find an opportunity to unlock new customer segments, gain efficiency and sell more by zigging while everyone else zags.
Thanks for reading!
Cheers,
Sam
