Given the growing complexity of the digital marketing and publishing environment, all players in the value chain must adapt to new technologies and channels and learn how to leverage data effectively to survive and grow.
That was the key message to emerge from the Adfu Symposium in Johannesburg on last week, where leading digital publishers, agencies, marketers and technology providers gathered to discuss the latest trends in the fast-changing digital landscape. The Symposium served as launching pad for Adfu – a new South African online premium display ad network from Kagiso Digital.
Setting the scene, Sleekgeek founder and former GM of Avusa Media Live, Elan Lohmann, said that the advertising market started out by being fairly simple with mostly only the publisher standing between the audience and the advertiser. Now, however, new technologies and new intermediaries such as ad networks or exchanges mean that the picture has become far more complex.
But some fundamentals remain unchanged: publishers want advertising revenues, advertisers want return on investment and consumers want relevance. Technology holds the key to each of them achieving their goals, said Lohmann.
Publishers still sell advertising environments, but some of the mechanisms are changing, said Craig Corte, CEO of Kagiso New Media. And the technologies and platforms in the digital world are changing at such a fast rate that the role-players involved in the environment must reinvent themselves continually to stay relevant.
In the past few years, there has been the rapid rise of smartphones and tablets, and along with them, the advent of the “multiscreened experience” where consumers interact with content from multiple sources (for example, an iPad and the TV) at the same time, said Corte. People have also been freed from desktops by tablets and smartphones.
Against this backdrop, South Africa is lagging international spend in digital advertising. Here, only 2.5% of total ad spending goes to online display inventory compared to 20% in US, 30% in UK and 5% in many other major emerging markets. South African publishers and advertisers have some catching up to do, suggested Corte. He noted that with four million people interacting with Kagiso Media’s digital platforms regularly, it is an audience that compares in size to local satellite television.
Mike Luscombe, A&O Lead for South Africa at Microsoft Advertising and former CEO of Spacestation, said that competition in the attention economy is growing fiercer for marketers and publishers vying for a slice of the consumer’s attention. For publishers, the major challenge is building a scalable and repeat audience.
Publishers need to differentiate themselves through their quality content and the ease of interacting with their user interfaces, but rising costs of content production, technology and sales are making it difficult to do so profitably. To survive and thrive, publishers need to understand the impact of display inventory commoditisation, deliver content formatted for multiple devices, and embrace new ad formats and opportunities, said Luscombe.
Publishers should segment their audiences and propositions, and work with advertisers to target them with the right experiences and content, Luscombe suggested. Targeting should be done in a manner that is mindful of users’ privacy.
There used to be only a handful of online environments, said Joanne Scholtz, Chief Warrior at Digital Warrior. But now there are millions, and advertisers have access to many of them through ad networks or exchanges. The question for advertisers in this world is can they track and measure the value they get from different environments.
Older measures such as click-through rates or costs per click might not be as valid as they once were, said Scholtz. Many advertisers chase the lowest possible cost per click, but often their perception of the low value of a click is a result of the fact that they do not measure beyond the click or the brand uplifting of display inventory. For many advertisers, cost per acquisition might be a more meaningful measure from a performance measurement perspective, but this still does not measure the effects of branding.
Roan Mackintosh, business director, at Acceleration eMarketing, also stressed the value and importance of tracking the right metrics. With the move to a more automated world with media buys being increasingly being governed by bid algorithms, marketers cannot ignore data any longer. One of the major questions, he added, is who owns the customer?
Marketers think they do, but publishers, agencies, and networks are all gathering information about marketers’ customers. In some cases, networks or exchanges might even use this data to retarget a marketer’s customer for another brand. It is imperative for successful companies today to be data kings, who own, protect and understand their data, said Mackintosh. International data kings include the likes of Amazon and Apple, but South Africa has few similar examples.
Kagiso Digital’s divisional head, Attila Bernariusz, said that the Adfu Premium Network had been created to start addressing some of the challenges in the South African online display inventory space outlined by Symposium speakers. He said that advertisers want richer targeting options and more sophisticated segmentation models than they are getting from most local publishers or networks.
Publishers, meanwhile, want to improve the often dismal rate of return they get on inventory sold through ad networks. Adfu offers value to both the buy and sell side of the market through a world-class technology platform, that processes ad traffic seamlessly with richer targeting options that produces value for both publishers and advertisers.
Adfu is Kagiso Digital’s latest offering to local marketers with access to ad impressions at scale from leading South African and African premium and niche publishers, offering contextual, behavioural, demographic and retartgeting capabilities.
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