As old-school ad agencies are scrambling to get their fingers into the digital marketing pie, marketing technology continues to evolve. So, by the time these ad agencies have grasped the basic points or partnered with an “out of the box” platform, they’re laughably behind the curve.
The problem is that these guys are trying to take the traditional approach that’s been around since before the Internet—before cordless phones, even—and apply it to the digital sphere. Digital marketing is a whole ‘nother ball game—the rules are not the same.
Let’s start by looking at their revenue model. A good digital marketer makes money by proving return on investment through attribution, conversions, and engagement, which they manage through strategic deployment. How does an ad agency make money? By producing creative. They focus on creating the graphic or the video or the jingle with barely any thought given to how they’ll actually distribute it. It’s the billboard approach: make the ad, put it where the most people can see it.
Pre-roll is a perfect example of the ad agency model. If you don’t know the name, trust me, you know the practice. If you’ve ever clicked on a video only to be held hostage by a 15 or 30 second ad, congratulations, you’ve been a victim of pre-roll. The worst part is that, most of the time, these ads have zero relevance to you or your life, but you’re forced to watch them anyway. In order to watch the content you originally sought out, you first have to let an ad agency make money off of you. If you hate this, how do you think your customers feel?
It’s advertising based on impressions. Agencies will deliver reports full of metrics like CPM (cost per thousand impressions), which look impressive until you ask one simple question: who? Who saw these ads? Of the 250,000 people in the area, how many are likely to EVER buy my product? Why would I market to all these people if only a portion will ever have any interest in my business?
The agencies will answer that it’s all for branding, but the truth is revenue. Theirs, not yours. They drive revenue by designing creative and delivering massive amounts of impressions using tools like pre-roll.
So why do ad agencies use these tactics if consumers hate them so much? The answer is simple: their clients are demanding digital marketing, and ad agencies don’t have a clue about what smart digital marketing actually looks like. They partner with phone book companies who built massive, out-of-date tools to annoy customers, and they partner with cable companies who have done the same. Want to know what those two industries have in common? They’re losing customers and are in desperate need of revenue as they get their butts kicked by modern (digital) competitors.
These guys just don’t know any better. Ad agencies lack the insights that true digital marketers have on available marketing technology, and they’re largely unaware that we can now isolate specific audiences and drive trackable conversions. The days of cluttering people’s social media feeds and banking on Google for audience identification are LONG gone. You don’t need all the impressions anymore; instead, true digital marketers focus on delivering impressions in smaller numbers to only the people who matter to your business, bringing down your costs and raising your ROI. Another great thing that digital marketers know? We’re no longer beholden to tech giants and their constantly shifting pricing models. We have other, equally (if not more) effective ways to reach your audience.
So yes, using ad agencies for your digital marketing is hurting your business. They’re wasting your money on impressions that don’t matter. To see some of the technologies that real digital marketers use to cut your costs and drive better results, click here.