Casey Ferrell is a research analyst at Cutting Edge Information. He will be guest blogging at IIR’s upcoming ePharma Summit 2012 (February 6-8, 2012 in New York City). You can find him on Twitter or over on his company’s blog.
I used to think the word “revolution” was too strong to describe the effect of digital and social media on how companies do business. I thought that a revolution completely overturns the existing paradigm and yields new, previously unthinkable ones. With regard to digital marketing, I thought, “Certainly we are not looking at a whole new way of doing things, but rather we’re looking at new channels in which to do familiar things, right?”
Not only are digital channels proliferating at a rate greater than our ability to master them, but they are radically altering the marketing landscape to the extent that some companies are foregoing the old way entirely. As in, digital media are revolutionizing the way business is done.
In short, the appeal of older distribution channels is on the wane. Budget-minded brands and companies see an opportunity to level the marketing playing field by shifting into the digital space, where the costs are less and the reach potentially greater.
In fact, some companies are in the midst of shifting all of their marketing to digital. That’s right — all of it. I interviewed a marketer from a Top 100 pharma company for a recent report. What follows is some of the thinking behind her company’s move to all-digital. (Because our interviews at Cutting Edge Information often involve discussions of sensitive information and benchmarks, we keep our interviewee’s identities confidential.)
“We can’t justify the expense of traditional media like print and television for our promotions and advertising,” she said. “We also feel that those channels don’t offer the same impact, or bang for the buck, that digital ones do. We didn’t do national TV campaigns, but we would do regional TV campaigns. So millions of dollars were going into those, and we weren’t seeing the return.”
An online campaign involving a popular blog aggregator website ended up doing for her brand what those TV ads were not, and in the span of three short years, that brand along with the company as a whole ended up moving to all-digital for its marketing efforts. For her part, the marketer said that may have been unwise (or at least too fast), because “going dark in broadcast media meant we saw a pretty significant decline in our web traffic, which we have to learn how to replace.”
It’s no secret that digital channels are claiming more and more bandwidth in companies’ marketing mixes. Achieving the balance that works for individual brands — a balance that maintains existing leverage in traditional channels while building scale in digital ones — is more art than science. On one hand, you can argue that incremental change can help achieve an optimal mix, while reactive, sweeping change can result in overshooting the mark. On the other hand, you can argue that the digital train is leaving the station, and companies not on it will be left playing catch-up for years to come.
Are there instances in which a wholesale shift to digital-only makes sense for brands or companies?
I’d be interested to hear thoughts on the extent and impact of the digital revolution taking place in your organization.