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Five DR Trends to Watch for in 2014 – Canada

By Pippa Nutt, Senior Vice President, Online & Canadian Media

 

Will 2014 be the year the death toll finally rings for traditional media?

Far from it. Consumers are more enabled than ever by new technology, and it’s bringing offline and online even closer together.

Here are five DR trends that will impact the Canadian DRTV market in 2014.

  1. Response is Evolving, not Dying

    This is not the end, folks. Don’t scramble to board the ark just yet. I’ve sat in countless meetings with panic-stricken marketers recounting how their top-performing direct channel (TV) just magically started to burn out. Did it really?

    In my experience, that type of pattern is unlikely. I would spend less time pontificating and more time looking for patterns in shifting response, because I promise you you’ll find something. In the last five years I’ve seen the share of total response for web go from a measly 10-15% (for those who were actually tracking it with any accuracy) to over 80%, regardless of the product or demo. People rarely pick up the phone any more, but they do go online – and you need to be able to account for what motivated them to do that so you can accurately track the return on your marketing investment. Tracking response and ROI in silos based on a single response method is increasingly flawed and will make it impossible to reach your target objectives.

    Advice: The core buckets most impacted by offline marketing are direct traffic, as well branded paid and organic search. Dig deep in your web analytics and I’m sure you will recover a significant portion of that “dwindling response”.


  2. Attribution: Think Beyond the Band-Aid

    Predictive modelling, regression analysis, first click, time decay – there is no end to the hype around cross-channel attribution. And while there are a host of solutions designed to granularly segment your online traffic and cross-channel influence (across all price spectrums), a huge gap still exists in accurately attributing the response influence between offline and online marketing tactics. We know there is one, but the ability to pinpoint that relationship with any accuracy remains an ongoing challenge and will not be solved with an off-the-shelf solution. The pressure is on and will continue to grow in 2014 as marketers are forced to be more strategic in terms of their budget allocation and investment in channels that will help them meet or, hopefully, exceed targets.

    Advice: A Band-Aid solution may help you sleep better at night, but is most likely ignoring the elephant in the room. Invest the time to develop a solid foundation. Attribution modelling is not hype – it must be approached pragmatically in order to serve you well in the long run. Leverage your various media partners for their advice and explore what others are doing well within your industry.


  3. Second-Screen Trending: Turning Data into Action

    More than 60% of Canadians are interacting with another device while watching TV with smartphones, social networking and tablets leading that diversion. But is that a good thing for marketers? On one hand, it offers the potential for added engagement and measurability of your offline investment. On the other hand, if they aren’t really paying attention, does your message stand a chance of getting through?

    Harnessing your audience’s attention across multiple screens may be one of the biggest challenges marketers will face in 2014. Facebook, Twitter, and various tech companies are trying to bridge that gap and help turn data into action. Beyond that, understanding the true value of that engagement and what it means to your bottom-line ROI is even more difficult.

    Advice: If you’re not already doing so, get your analytics synced up to measure same user interactions across devices. Use those learnings to define a cross-channel communication strategy.


  4. Online Video Advertising: Growing but still Skewed

    Over 38% of English-speaking Canadians now watch TV online, although not exclusively. The online video market will continue to grow in 2014 with online video advertising expected to surpass $200 million. Interestingly, Canada has over 90% of web users consuming online video, higher even than in the U.S.

    But before you reallocate half of your 2014 budget to pre-roll, consider this:
    • Online video viewing still skews younger, with Canadians under 24 consuming roughly 50% of video views. How does this line up with the product or service you are marketing?
    • The entertainment category continues to see the largest growth in number of videos
      viewed online. This is important when mapping out your targeting strategy.
    • YouTube dominates more than 50% of video views in Canada and continues to grow. Based on that reality, it may not be worth investing in high-priced CPM inventory to run in the same shows you would typically invest in offline.
    Advice: Think before you leap. Does it make sense for your demo or product/service you’re trying to market? If the answer is yes, test your way to success by leveraging more cost-efficient, wide-reach networks first, and expand from there.

  5. Smart TV: The Wild Card

    Smart TV penetration in Canada is still relatively low (21% for English-speaking Canadians 18+) but it’s growing, thanks to in-demand services such as YouTube and Netflix that are paving the way by enabling access to premium video content online.

    The concept is not new, however. Gaming consoles, Blu-ray players, tablets, laptops and the like have been bringing that same level of connectivity to the TV over the last three+ years. However, the shifts in media consumption are more transparent when you look at the under-35 demo. It’s estimated that three-quarters of 18- to 34-year-olds access video content online through connected TV over their pay TV provider with Netflix being the leader, followed by YouTube, Amazon and Hulu. This presents an interesting challenge when trying to reach that demo through more traditional means of advertising.

    Will this lead to the death of traditional TV content and broadcasters alike? A lot will depend on the availability of quality content that’s made available, and at what price through connected TVs.

    Advice: Wait and see how it plays out.

 

Summary:

New technologies combined with an ever-evolving market place are challenging conventional marketing wisdom, but for the better. Gone are the days of “set it and forget it” and age-old assumptions. It’s a brave new world, inspiring marketers to reach for new heights.

All the best for 2014!