There’s an old yarn about money in advertising: Half of it’s wasted, but no one knows which half. That’s about to change.
Last year, U.S. digital ad spending surpassed television for the first time. With online campaigns easier to target, track and customize, a growing cluster of startups in Ireland has formed around the potential to deliver more impact for the advertiser’s dollar. Companies like StitcherAds, Kong Digital and Popdeem are expanding their North American presence, along with their roster of clients eager to make the most of the $70 billion market for digital advertising in the U.S.
Twice the revenue, three times the sales
Sheryl Sandberg called out a Celebrity Cruises campaign powered by StitcherAds during a Facebook earnings call last fall. Noting that the social network’s new Dynamic Ads for Travel tripled Celebrity’s online bookings, the Facebook COO said, “I think these kinds of results are made possible by more vertical-specific products, and we’re going to continue to invest more here.”
This type of technology allows businesses to serve unique-to-user advertisements for its entire product catalog to either retargeted website/app visitors or new audiences. The technology works by pulling product information direct from a feed into an ad template; and StitcherAds was one of the first companies in the world to conduct feed-based advertising on Facebook. The latter’s Dynamic Ads offering takes the concept a step further, helping advertisers automate, optimize and scale their campaigns to achieve a higher return.
In the Celebrity Cruises example, a pixel on Celebrity’s website tracked itineraries viewed by potential customers. Facebook advertisements then displayed available cruises, pricing, images and messaging informed by the trips people had already viewed online. According to Facebook, sales from the ads brought in twice as much revenue as the cruise line’s campaigns using traditional paid search.
Investing in analytics
How agencies track their clients’ ad dollars is fast becoming as important as where that money is spent. A 2016 Gartner surveyof chief marketing officers found they directed an average of 27 percent of their budgets toward technology, compared to 22 percent for paid media. Another poll by Walker Sands Communications found that two-thirds of marketers expected their technology budgets would increase in 2017.
That rapid growth was not lost on investors in Ireland, who have aggressively promoted the island’s technology sector in recent years. At Enterprise Ireland, the country’s economic development agency, we awarded €32 million in funding and other assistance to a diverse range of startups last year. Five companies in marketing technology were among the high-potential startups the organization selected for seed funding in 2017.
Kong Digital offers an example of where those businesses might be headed. Part of the Enterprise Ireland start up program in 2015, the company works across Music & Entertainment, Hospitality, Health, and Online Retail sectors. Clients include Universal Music Global, who use Kong Digital’s marketing platform Kongalytics to manage over 450 of their artists’ social media accounts. Kong Digital have been involved in promoting artists such as The Beatles, Justin Bieber, Lady Gaga and Hozier.
Kongalytics allows brands to manage, schedule and analyze all content shared across their social media platforms. Kongalytics integrates all of this social media data with online advertising in real time and tracks the impact those campaigns have on SEO performance. By connecting social media management and advertising, Kongalytics builds true audiences. Kongalytics users have reported a 50% reduction in wasted ad spend, a 10x increase in ROI and halved campaign management times.
The future is interactive
While the latest marketing technologies differ in their solutions, they’re underpinned by the industry’s desire to interact with consumers based more on what they do than what they’re looking at. Where older platforms would deliver messages based on the media surrounding them – an article, a video, a search query – marketers now find much of their success communicating directly through social channels and mobile apps.
Popdeem, another marketing-tech company that originated in Ireland’s startup scene, gives businesses a plug-and-play tool for adding engaging social loyalty programs to their apps. In one case, a Kentucky based coffee chain called Heine Brothers’ Coffee gives out rewards and loyalty credit for customers that check-in or share photos at any of their 14 locations. Loyalty points, freebies and sweepstakes encourage their clientele to share their experiences at Heine Brothers’ on social media, reaching more potential customers and boosting valuable word-of-mouth exposure.
Tempting customers with discounts or encouraging them to tell their friends about a great experience is, of course, nothing new. The real promise of marketing in 2017 lies in the ability to deliver a promotion or a message to the exact people who will find it relevant. Soon, advertisers will finally be able to separate the campaigns that work from those that are wasting money. As they do, innovators like those in Ireland’s marketing technology cluster will tap into enormous potential for ad-budget savings while enhancing their clients’ return on that investment.