Mad Men’s Don Draper would hardly recognize the advertising landscape today. The print and television campaigns he specialized in are quickly losing prominence thanks to the growth of digital marketing and social media. It’s probably for the best that Sterling-Cooper-Draper-Price aren’t a real agency; their name is a bit too unwieldy to fit in a hashtag. Advertising outfits these days need to be adept crafting their message for a digital market.
Recently, I had a chance to speak to Matt Cronin of House of Kaizen, a digital performance marketing agency. House of Kaizen helps consumer-oriented businesses gain customers through the internet, through exclusively digital media. An entrepreneur since 2001, Matt shared with me his thoughts about the rise of digital advertising, the shift in skillsets brought about by the drift to digital media, and the challenges faced by digital advertising agencies.
Here’s what Matt had to say:
- Social media advertising really is the next big thing. The industry has been growing substantially over the last few years. Social media platform like Facebook have overtaken search engines as a focal point of marketing. As Matt says, “Social media, from a paid advertising perspective, is huge.” Facebook has always been important to users of social media, but as a profitable business model from the advertising industry perspective, it’s exploded in the last couple of years.
- Having an interest in advertising isn’t enough anymore. When it comes to hiring for House of Kaizen, Matt says that having an interest in advertising is a good start, but it’s just the tip of the iceberg. He looks for candidates with an education or interest in economics, behavioral economics in particular. He wants people who are able to look at and understand the relationships between numbers and key influences. In the realm of digital media advertising, tactics and results are more manageable and measureable, and changes can be made to bring better results. People who think of advertising traditionally actually aren’t qualified enough, in Matt’s perspective. People who are interested in quantitative analyses and in shaping behaviours are more desirable candidates.
- Don’t forget to mind your own business. Matt notes that while it is important to keep your clients’ needs in mind, it’s also crucial to consider what your own business needs in order to expand and stay on the top of its game. Often, owners overlook their own agency’s needs while thinking about their clients. Don’t forget to work on internal development.
- Entrepreneurship may have become easier, but it’s still not for everyone. As Matt sees it, there is still only a small group of people for whom starting their own business is a realistic prospect. Not everyone is in a situation where they are financially able to take that sort of chance. Although the risks of starting a business are much lower now than they’ve ever been, the stakes are still relatively high. Matt believes that as we have more people taking the plunge, we’re going to probably see better businesses, but not necessarily better entrepreneurs.
- The digital media advertising industry has not yet fully matured. Matt has been in digital media advertising since the very beginning. He believes that the industry is only just starting to mature, and that people are still facing many of the challenges that they were facing at the beginning. One of the biggest challenges his agency faces continues to be fighting the battle of share of budget amongst their clients. They continue to try to prove to their clients that they can provide a ROI through exclusively digital media versus through traditional channels such as print and television. While client budgets may be getting bigger, digital media is still a small fraction of the advertising industry.
- The digital media advertising industry is still a Wild West. Matt explains that while it’s matured a certain amount, it’s still growing and changing significantly, and much more frequently than the rest of the advertising business. Absolute reversals in strategies are not uncommon as agencies continue to experiment with tactics. Matt has learned that it is easy to miss out on opportunities as the market shifts one way or another.
Some great thoughts from Matt Cronin about the current state of digital advertising, its challenges, and its potential. Is your business still focused on the traditional advertising model, or have you taken the plunge into digital?