I’ll go out on a limb here and state that fully 30% of local ad budgets are spent in dying media. It’s probably a lot more than that, but I like to sandbag a little. Plus, the total share of local advertising dedicated to these media shrinks daily, so by the time you are reading this … 30% may be true.
What is dying media? Simply stated: Newspaper, Yellow Pages, and Direct Mail.
It has been well documented that these three media are forecasted to give up serious ground over the next five years. In total, the number is probably in the $18-25 billion range … but that depends on the source and, once again, when you are reading this article.
Whatever the case, there is a critical point to be made here.
Paid search, the likes of Google’s Adwords, is steadily growing in usage (notice I didn’t say “growing in popularity” … there’s a reason for that too). It’s growth is fueled to the tune of 65% from the three above-mentioned dying media. That is, nearly two-thirds of all money being poured into paid-search is coming from, you guessed it, good ol’ YP, print and DM budgets.
So what’s the point here, exactly?
This trend is only going to continue … if not accelerate. And it will be a shame for the advertiser and the broadcaster. Both will lose. Unless something else is recommended, today.
Social media provides a very capable way for local businesses to accomplish every single objective that their dying-media-budget was supposed to do, only much more efficiently and cost-effectively. This frees up budget for the advertiser, preserving appropriate share for the cost-effective local media like broadcast television and internet.
Social media can also accomplish every single objective that paid search is supposed to do … only much more efficiently and cost-effectively. Why pay for your leads when you can get them a lot cheaper?
It is our recommendation, to the advertiser and the broadcast salesperson that they strongly consider getting versed on social media — in a hurry. Not doing so puts you at a square disadvantage to the competition. This includes things like Facebook, LinkedIn, Twitter, YouTube, blogging, and RSS. When used with proper attention and dosage, they free up significant budget and do a better job than print media or paid search.
Did I also mention that they are virtually free? Advertisers love “free” … especially if it works. And it does.
That said, why wouldn’t a local advertiser rely 100% on social media? Well, that could be a big mistake for a destination business. Local retailers and service companies who need the attention of the masses to gain market share … still need broadcast television to do the job. And do the job it will.
A simple plan is to begin divesting as soon as possible any budget spent in inefficient media. If the cost per thousand against your target demo is growing, as is the case with dying media, it’s time to switch. Run a quick comparison … is your cost per thousand $10, or closer to $50? Apples-to-apples will tell the story.
Next, get a LinkedIn account. Make a “page” on Facebook and get some fans. Twitter out a sale. When you get more comfortable, post a blog, get a Delicious account, and feed those beefy keywords right to your (the advertiser’s) site.
The battle is raging, both online and offline. If appropriate action isn’t taken soon, paid search will continue in its role as the vacuum of inefficient media — until keyword prices are bloated like a saltine in hot soup — and we recreate the original problem. It’s already happened in several local markets. If you don’t believe me, try Google-bidding on legal keywords in Seattle, for example. Or just about any market, for that matter.
The interesting part of this all … advertisers can own those same keywords on the preferred side of Google … the organic side of the page, for free. And save the rest of their budget for a medium that actually drives down the cost of acquiring new customers. That would be … you guessed right: broadcast television and local internet. The two local media which still do what they’re supposed to: acquire real leads and customers at a declining cost.
Aren’t we all trimming our budgets by 30% anyway? May as well make it work while we’re at it.
Dave Eckstein does not play shortstop and was never the MVP of the World Series. He is a partner in the firm ESA & Company, based in Red Bank, New Jersey.