Is Digital Advertising Broken?
A Forbes article by Dr. Augustine Fou has been making the rounds and for a good reason. When big brands like Chase and Uber slashed their digital advertising, they saw no change in revenue or app installations.
Jesse Ouellette researches how companies are deploying their advertising and sees the same issues across verticals and company maturity:
To have a productive ad, you need correctly installed pixels that are using the latest version of code, weblogging, and a streamlined user experience once people click through to your landing page. The page should have a single, straightforward call to action. This can take hours to put in place and test. Then you must collect all of that data to figure out your ad results and learn what your next iteration should look like.
“The analytics part of advertising is getting a lot harder. There have been many changes in security, which makes it more difficult to pass the information from ad to website.”
Most web browsers and iOS devices have significantly changed how data is stored on browsers and devices, and third-party cookies are no longer allowed. Firefox and iOS/Safari limit the number of days a first-party cookie is retained, and the type of parameters you collect can restrict your timeline even more. Google is following suit and will be doing away with the third-party cookies, and those of us watching trends are confident they will begin restricting the timeline for first-party cookies.
Understanding your ad performance involves collecting a lot of first-party web activity, and that web activity will accumulate quickly. Our timeline to first “sale” must get much shorter, with data only being stored 24 hours to 7 days on the browser or device. Because of the high volume, it doesn’t make sense to store web-based information in your CRM. Companies must explore a B2B CDP, and they need to do it sooner rather than later.
“Companies have to figure out their customer data platform strategy. They need to explore different products that have a larger cloud storage mechanism. If you’re spending a hundred thousand dollars a month on programmatic ads, you should be connected to your ad vendors at the API level, and make sure your domain is verified.
“Companies that can derive the right insights and make the right decisions will disrupt the market.”
Jesse also called out that a LinkedIn or programmatic ad that proposes a sales demo as your value exchange isn’t going to work anymore.
“You’re going to have to have a driver of some sort that gets them in the door. But even that isn’t enough if you’re targeting the wrong people or the right people in the wrong places. If a person’s on LinkedIn, they’re not necessarily wasting a lot of time. They’re looking up something for their business. Take some of that audience and target them on Facebook and other remarketing programs at a lower cost.”
When it comes to structuring a strong ad, the creative itself is pretty simple.
“There’s an acronym that helps me: AMO.”
“I joked with a friend that a lot of these companies are blowing up a Ferrari on their front lawn every single month. Ad spend is too expensive just to set and ignore. A lot of these companies aren’t monitoring whether or not the ad is landing. But people need to look beyond the ad click. If I’m sent to a page with a wacky drift bot coming at me with music and three other forms popping up at me, it feels overly aggressive. I have to wonder, has anybody actually tried this?”
Facebook Myths & Truths
Jesse watches companies spend money on search engine keywords and LinkedIn. These two ad strategies don’t consistently yield results. Search engine keywords can be especially problematic. Jesse used the example of a large corporation spending most of their advertising dollars on a “free PDF editor.”
“The majority of people engaging with their ads are people who are looking for a way to edit a PDF during tax season or working on a school project. These are people who aren’t in a position to buy this enterprise company product, nor will they ever be. It’s not a good use of dollars.”
Because many people are on Instagram and Facebook, and those platforms are where people go to waste time (consciously or subconsciously), they’re better platforms for advertising than LinkedIn. As Jesse said earlier, people are usually on LinkedIn for a purpose and don’t tend to waste much time scrolling.
When Jesse suggests the Facebook advertising tactic, many companies balk and give him the same three excuses.
“Number one is ‘my audience isn’t on Facebook.’ I get nervous about that one because yes, they are.”
Those of you picturing a chart that skews toward the older demographics would be wrong. Here’s the latest data, and the largest group is 25-34 years old. While more people in older age groups are using Facebook than any other platform, this doesn’t mean younger groups aren’t also using the platform.
“The second myth is that Facebook is not effective for B2B. It doesn’t matter who you’re targeting; everybody’s on Facebook. If you’re not on Facebook, there are people in your life who are, and they’re going to tell you what they see online. To get in front of your audience predictably, use Facebook. Take your LinkedIn look-a-like and targeted audiences and transition those into Facebook audiences.”
Using Facebook doesn’t mean you get a free pass on analytics. You must set up your pixel tag correctly, collect the information as it comes in, and apply what you learn about current campaigns to future campaigns.
“The third myth that I always hear is, ‘My business is different,’ or ‘we make an enterprise sale.’ These objections don’t fly. No matter what business you’re in, you need to offer some value to a person. The problem may be that you’re not offering enough value to an individual with your ads.
“If you have a SAAS product that’s a hundred thousand dollars, you have to offer something of value before that price point. You may have to offer a certification or build some sort of course. What doesn’t work is going from zero to a hundred thousand dollars of ARR on the first sale. There needs to be some value exchange before that point. And if there’s no value exchange, you’re just not going to get anywhere with online advertising.”
If you’re on Facebook and not seeing results, Jesse sees four common causes:
- Ad creative and message
- Shutting down the ad too soon
- Scaling too quickly
- Spreading budget too thin across several splits
“One reason you don’t want to shut Facebook ads down is that their learning algorithms improve audience and ad presentation over time. The second huge reason is that you want to get engagement on your ads. By shutting one of them down, you will lose the social proof that you might’ve generated by people liking it and engaging with comments. Even negative comments can help you.
“Facebook has a little bit of a challenge around its overlapping audiences. If people increase spend by adding the same advertisements, your audiences begin to overlap, and your return declines.
“Split testing can be a problem if you spread your budget too thin. If you’re testing 12 different spots on Facebook and Instagram, your campaigns can become inefficient.
“Finally, don’t bother trying Facebook’s broad audience matching. Don’t do interest-based matching. Define your audience and try to match people up one-to-one. That’s what the best marketing teams are doing right now. They find people on other networks, and they’re using that data to target them on Facebook.”
The Digital Landscape Is Changing. Are You Ready?
Third-party cookies are already largely obsolete. iOS devices, Safari, and Firefox no longer support third-party cookies. If you haven’t noticed a drop in ad effectiveness (particularly across paid search or retargeting), you’re not paying attention.
There are better ways to advertise today, given the current landscape, but they involve early data collection on your part and one-to-one matching across your advertising platforms. A lot of advertising companies have switched to direct relationships with publishers. If you provide them a list of email addresses, they will work with publishers to retarget your specific audience with ads.
This is a massive improvement over the days of buying keywords that your target audience may not even use. But to capitalize on this strategy, people need to understand their data.
“You have to start with a customer data platform strategy. Collect as much information as you can, and do it while meeting all of the global requirements. Adhere to the rules established by GDPR, CCPA, and New York Shield. The people who will have it the worst will be the small businesses that aren’t able to build these massive data platforms or can’t purchase a CDP that can join all of the data together.
“There are also people who aren’t paying attention. Some companies have the money, but they’re ineffective. They either don’t have a data strategy or don’t think through how to collect information effectively. You go on Google every day, and you’re not thinking about them tracking your data there. They’re doing it on a massive scale, and they do it well.
“Companies also need to realize that their timeline to close a sale online just got very short. And it’s getting even shorter. We’re going to go from a 28-day cookie retention period to a seven-day cookie retention period. After that, you lose your tracking.”
One of the biggest shifts companies are going to have to make is the go-to-market mentality. Teams can’t be siloed and effectively go to market. Marketing needs the intel that comes from customer success and sales, and businesses need to value marketing operations and analytics.
“Determining the audience that you want is a massive thing that has to be taken seriously. You have to pivot dramatically. You might have to pull one of your engineers and bring them into marketing at this point.
“The journey has to make sense. Think it through, do some testing, and understand your sales process. When companies start to segment their SDR team and their marketing team, and they say, our SDR team is not hitting their goals, but the marketing team is, you’ve made a big mistake. We have one revenue team, and if any portion of that team isn’t meeting their goal, none of the other groups are either.”
For more from Jesse, including the start-ups doing digital advertising the best, which business models work best in today’s market, and why pull sales into the marketing conversation, check out the full episode at the top of this page or anywhere you podcast. You can find Jesse at revenueadvisory.com or leadmagic.io.