Has Digital Marketing Finally Earned Its Budget Keep?

A few years ago, TV, radio, print, outdoor, direct marketing and a few creative ‘space-planning’ ideas dominated the South African advertising channel mix. It was about Philip Kotler and the four P’s. Most businesses considered digital to be a website or email campaign, and if they were really being adventurous, an SMS campaign. Today, what’s referred to as ‘digital marketing’ is an essential part of the integrated marketing mix. However, in South Africa, currently, the majority of big business’ marketing budget is still allocated to ‘traditional’ advertising channels – this in a country where there are more cellphones than TVs.

The digital marketing vs. traditional marketing debate has been an ongoing discourse within advertising agencies and business boardrooms for the last 10 years. I’m not an advocate for the ‘vs.’ debate. I believe in an integrated approach where the context and content inform the channel – whether it’s purely digital, purely traditional, or a mix. The sad truth is that in 2015 the majority of advertising campaigns in corporate South Africa will give their leftover breadcrumbs to digital channels. The question then needs to be asked: has digital marketing finally earned its budget keep?

A PWC industry report in 2013 indicated that digital channels made up 34% of a 8.9 billion Pound advertising market in the UK in H1 of 2013. This is the first time that digital as an advertising category overtook TV as an advertising medium, with regards to advertising spend.

The same PWC predictions indicate that digital will only reach a 10% share of advertising spend in South Africa by 2018. That’s a little too far away for my liking.

By noting these stats, it’s clear that digital has started to earn its keep in the UK, but that South Africa is still sadly lagging behind. The reasons for this could be anything from trust, infrastructure, aversion to change, or the lack of skills of local suppliers to make digital work for their clients.

One of our clients at Flume sees 90% of its total business leads produced through their website. That means it’s digital channels are responsible for most of its new business, however, the digital marketing budget allocation is still less than 10% of the total advertising spend. One cannot detract from traditional channels, but surely one would think that with the availability of these stats, the percent of digital media spend would increase in this case. The only reasons I can think of is that digital is still perceived as the ‘new kid on the block’ and that there’s an apprehension to want to spend too much of the advertising budget in a space where a business has little history or proven results. Let’s ask the question again: has digital marketing finally earned its budget keep? The answer in South Africa, in my opinion, is an unfortunate “no”.

So then how do agencies help their clients buy in to spending money in the digital space? I believe that as digital starts proving that it’s a viable channel, not only for brand awareness, but for lead generation as well, the advertising budget will naturally flow toward digital channels. This means skills development is key, and that South African agencies and clients need to work together to push the envelope on what can be achieved not only online, but through-the-line as well. I also foresee that the discourse around ‘digital marketing’ will start to lessen in the next 10 years. We won’t refer to traditional or digital channels, per-say, but rather to marketing in a digital world. I’m not advocating spend in the digital space because I think the pie chart needs to be balanced. I’m advocating this spend because I firmly believe that digital can achieve business changing results when done right.

Source: http://za.pwcmediaoutlook.com/industry_overview– Jacques Du Bruyn

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