Consumer behaviour and the digital boom
Digital advertising is evolving at an alarming rate, writes Microsoft’s Owen Sagness, but so is the behaviour of consumers – so how are brands meant to keep up?
The booming smartphone and tablet market has seen the number of different devices sky-rocket in recent years, with the average family home now having 10 connectible devices. Consumer behaviour is evolving at a similarly rapid rate, and brands have a tough job to keep up with their changing expectations in order to remain relevant.
By 2018, a third of all advertising revenue will come from digital, according to a study on the UK’s entertainment and media (E&M) industries released by PriceWaterhouseCoopers (PwC) earlier this month. The report also predicts that internet advertising will overtake TV as the most influential medium.
These are impressive statistics, and they show what an exciting time this is for a digital advertising industry. There are two key challenges I see dominating here: how well brands can deliver experience seamlessly across different devices; and how well those same brands recognise the value they can add beyond simply communicating their message.
People are seeking smarter ways to reduce information overload and online clutter. Consumers want technology and experiences that aren’t ‘always-on’ but actually help them switch off. They want technology that is intuitive and informed, and I’m seeing brands becoming more aware of this, experimenting with tailored approaches and appreciating that forming personal relationships is of increasing value to ensuring long-term engagement.
On the other hand, consumers are also for the first time beginning to understand the value their data holds for brands. We all know the power of data and what it can deliver for us as advertisers, but there are real sensitivities associated with personal information which have been in the media spotlight over the past year or so.
It’s important for brands to put consumers first, educating them about how this data, when used properly, can create online experiences that they will really enjoy. This ‘value exchange’ between brands and consumers is continuing to evolve and should be front-of-mind for all companies – especially those with a digital presence. As our industry learns to better use the data at our disposal, consumers will also continue learning how much theirs is worth.
Brands need to make clear the benefits of engagement for the consumer, outlining upfront what that value exchange looks like to encourage their audience to want to interact with them. As this relationship becomes more transparent, consumers will become more relaxed about offering up their data – in safe, controlled environments – in exchange for the best digital experiences.
Data and the insights we can draw by the right engagement with consumers can provide marketers with the ability to connect with people better than they ever have before. The opportunities and rewards associated with creating more relevant and impactful advertising is huge – if we’re offering truly relevant, useful content, there’s no reason advertising can’t become the new entertainment.
Backed by the relentless growth of the tablet market, advertisers are dedicating increasingly large budgets to mobile spend and video-on-demand is becoming more popular than ever before. But simply throwing more money at digital isn’t enough – content must be engaging on all screens.
Considered, insight-driven cross-screen strategies will allow brands to speak to consumers on multiple devices and produce unique experiences that truly push the boundaries of innovation.
The industry needs to listen carefully to consumer demands and learn from others’ successes and failures. For creatives, media agencies and publishers, it’s up to us to work together to battle ‘ad blindness’, assessing and understanding consumers’ changing online behaviour in order to remain relevant, forcing ourselves to keep challenging what’s possible in digital advertising.
Owen Sagness is GM of Microsoft Advertising & Online, UK
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