Out with the old and in with the… failing?

30 Jan

U.S. businesses have and continue to be regarded as cutthroat and impersonal. Whoever’s bigger, faster and smarter sees exponentially better growth rates and stronger customer loyalty. This is applicable to every business from Mom-and-Pop startups to global-media outlets. In the mid-1990s, the Internet took the U.S.’s business environment to a whole new level. Businesses who were used to advertising their product or service through traditional ads, such as newspaper ads and event sponsorships, witnessed weaker sales compared to companies who evolved with the growing trend in going digital. Now, businesses who aren’t keeping up with new technologies- particularly legacy media outlets – are seeing massive job cuts and a loss in profit. What must these outlets do to survive, one may ask. Develop advanced advertising techniques, which is more difficult than it sounds.

With big digital companies like Google and Facebook, advertising has become more interesting. It’s easier now to bypass advertising agencies and focus on websites who are capable of reaching billions around the world with one click. This kind of advertising is referred to as unmeasured media. For example, Facebook advertising costs approximately sixty cents per impression1 compared to broadcast television’s ten dollars per contact2. The sheer difference between the dollar amounts shows that advertising via the Internet has a strong competitive advantage.

Assistant Professor Stephanie Padgett of the Missouri School of Journalism shared in her guest lecture on Monday, January 28, that businesses see these inconsistencies of advertising in media outlets like television and newspapers and are throwing their money elsewhere. Measured media choices, such as commercials and magazine ads, have seen a .2 percent decline in spending while unmeasured media options have increased in spending by about twelve percent, according to a recent study by Ad Age. Unmeasured media spending makes up an unprecedented forty percent of all advertising dollars and is described positively as “connecting [marketers] to target consumers.”

The Internet has brought positive and great things to the world of business. Better communication, declined human error and providing companies with tools to go global are just a few examples. The need to expand a company’s advertising techniques is what determines if a business grows or dies. Advertisers know that competition has changed drastically, but there are still a few who are unable to grasp the concept. They may never know. It’s hard to keep up with a seemingly intangible opponent.

1: http://www.quora.com/What-is-the-average-CPC-and-or-CPM-rate-for-Facebook-in-the-US

2: http://www.emarketer.com/

Author: Matt Mazick

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