The battle for budget in the digital space

2010, another year, another marketing budget, another significant year-on-year increase in the amount corporates intend on investing in digital.

As an eMarketer, this is great news for me and the agency I work for as each and every year the “battle for budget” between digital and the more traditional above-the-line mediums (predictably) sees the lion share being portioned to the ad agencies, while the virtual scraps are thrown to the budget line item that is digital/interactive/eMarketing.

The purpose of this post though is not to rant, neither is it to dwell on budgets and where they should or shouldn’t be going (I’ll save that one for another post).

In South Africa, digital as a marketing channel has a problem and I can’t help feeling a somewhat shallow sense of satisfaction about the increase in the channel’s allocated year-on-year budget.

Corporates are approaching the web with an “everyone-else-is-doing-it-so-we-better-do-something-too” attitude. Now I understand that this is somewhat of a generalisation, but when I hear companies talk about investing in digital I wonder what they really mean. Are they using the platform as an opportunity to propel their business forward, or are they using digital as nothing more than something to support their TV/print/radio campaigns. Or worse, are their digital initiatives standing alone on a brand communication island with just the 1 palm tree?

From experience on both sides of the client/agency fence, I can say with confidence that digital as a support mechanism for traditional marketing efforts, as well as digital for digital sake, is where web spend is going.

As I mentioned earlier, this post is not about ranting, it’s rather an attempt at identifying what I feel are issues holding the South African eMarketing space back from taking it up a level.

The challenges, I believe, can be broken down into 2 basic categories: Client-side skill sets, and The client/agency partnership.

1. Client-side skill sets

The web is seen by many traditional client side marketers as somewhat of a black box – Step 1: Tell “web designer” what you want. Step 2: “Web designer” goes off and does his thing. Step 3: Pretty brand message on www.mybrand.co.za.

What is lacking is a level of understanding in terms of what the web is capable of beyond a pretty looking web page.

The more progressive brands in South Africa are aligning themselves with international standards by recruiting specialist eMarketers who work as part of the marketing team. This represents a major shift. These brands understand that their web future can no longer be placed in the hands of someone who doesn’t “get it” (read: usually the IT department).

If there’s just one element of eMarketing that I would recommend corporate marketers understand, it is this – Return On Investment. The web is an empirical beast. EVERYTHING that a user does online is measurable.

This means that you’re able to start your thinking with the question “What return do we need from this campaign to make it worthwhile?”. Starting with a question like this immediately reinforces the beauty of eMarketing. It’s the first marketing channel that is truly able to justify its existence (if implemented correctly) and a massive mindset change needs to occur to understand that.

2. The client/agency partnership

The way agencies are selected by their clients need to change. Recently, I have been involved in 3 big pitches in the past 3 months. Two of these 3 pitches were outsourced by the client to a specialist pitch agent who implements a pitch structure. This gives the client an opportunity to initially define what it is they’re looking for, and in turn, a bespoke pitch framework is developed for agencies to work within.

As an agency it gives us the best opportunity to show our skills in an environment where the objectives, requirements and challenges are defined upfront. The benefits for the client, beyond the importance of really giving a lot of thought in terms of what’s needed from digital, is the ability to compare apples with apples.

Digital agencies all have particular strengths, for example design, strategy, and development, but there is also a growing demand for the full-service agency, the ones that do everything under one roof. Selecting an agency to partner with requires brands to look at their overall objectives and match their needs to agency’s strengths. Thereafter the agency should be treated as a partner, not a production house. This is how you get the most out of the medium.