Advertising Archives

Google, Facebook, Snapchat, Twitter, and every other digital channel recently released their numbers. What can we learn from these media earnings reports, and what does it tell us about the future of digital marketing?

Let’s start with one things that is clear: small advertisers are investing heavily in digital advertising after a year where budgets were slashed considerably. The recent media earnings reports show that revenue for Google, LinkedIn, Snapchat, and Facebook are all up significantly. For Google, for example, year-over-year revenue growth shot up 69% in Q2. That’s telling, both from the perspective of recovery, as well as indicative of where marketing budgets are being allocated. This is particularly true for small advertisers who are more conscious of controlling spend and looking to run more manageable micro-campaigns. Where we continue to see cuts, however, are from larger advertisers, who seem to be reevaluating how millions are spent every year.

In a recent study from Gartner, where over 80% of respondents represented companies with over $1 billion in revenue, estimates showed that the portion of revenue that would be allocated to marketing and advertising was cut by almost half, from 11% in 2020 to 6% in 2021. While the total spend is still considerable, the ratio suggests an increasing move to isolated campaign spends, rather than ongoing national campaigns. The most likely reason is a greater focus on direct return-on-investment after 2020 sent shockwaves through the business world. You might wonder why, then, did we see such success in this week’s media earnings reports? Small advertisers are jumping on the digital ad bandwagon – if a little late – and we can certainly expect to see that trend continue.

Noise on social has made organic growth significantly more difficult, especially when it comes to direct e-commerce sales, which many brands shifted to (some exclusively) in 2020. As a result, paid campaigns have increased at every level, and as you can probably guess, there are significantly more small advertisers than billion-dollar organizations. This has long been a goal of digital media companies: scale small- and medium-sized advertisers globally. 2020 seemed to provide the jolt needed for many on the fence, and we are now seeing the results.

Year-over-year growth is sure to even out as economies open back up, but the trend of seeing an increase in small spenders filling the coffers of digital media companies, rather than the traditional major advertisers making up the majority, is something we should get used to.

This year, for the first time in recent memory, staple advertisers opted out of paying big dollars for their usual Super Bowl ads. Have we finally moved beyond the peak in Super Bowl ads spending?

Super Bowl ads are what bring both fans and non-fans of football together every year. We wait to see which celebrities will make an appearance, which brands gave it their all, and who fell short in one of the year’s most significant media investments. This year, however, Super Bowl ads felt a little different. There wasn’t the same pazzazz to which we have become accustomed, and some familiar faces were left off the map. It begs the question: is the Golden Age of Super Boal ads behind us?

Image Credit: Shutterstock

While it’s always fun to talk about who was advertising, this year, it seems more pertinent to focus on the brands that opted out of their traditional Super Bowl ads spots. Namely, Coca-Cola, Pepsi, Budweiser, and Audi, to name a few.

Let’s start by stating the obvious: this wasn’t your average year for advertisers. Ad budgets were slashed across the board – in nearly all major industries – and that was bound to have an impact on Super Bowl ads spending. But while that notion played a critical part in major brands’ decisions not to advertise, we need to think of the long-term implications of brands as notable as Audi and Coca-Colaopting not to advertise their namesakes during the Big Game, while continuing to advertise elsewhere.

A Critical Shift Driven by Data

Let’s start with Audi. In 2011, Audi claimed to be the first major brand to use a hashtag in their Super Bowl ads in an effort to drive additional value by continuing the conversation online. This year, instead of running any commercials, Audi focused all of its efforts on promoting the new release of an all-electric e-tron GT digitally. Why does this matter? Largely because the new car was unveiled virtually February 9th, two days after the Super Bowl. Traditionally, this would have been an ideal time to make the announcement, then maintain that momentum into the release, only a couple of days later.

By foregoing the major spend on airtime and a commercial, brands like Audi had the benefit of focusing entirely on drumming up interest online, with more trackable mechanisms in place. For example, one of the ways in which Audi garnered interest and collected prospect information was on Twitter. They used Sponsored Tweets to tease the release, and by liking the content, users were automatically invited to the unveiling. This not only streamlines the process, but it provides significantly more insights for the brand at a far reduced cost.

Vocal, Conscious Decisions

Budweiser has been advertising during the Super Bowl for 37 uninterrupted years. While they still had plenty of brand coverage at the game, they did not create a commercial, and instead donated $1 million to vaccine awareness and education campaigns. Coca-Cola, while still buying ad time for some of its non-namesake brands, issued this statement on why it would not be advertising its main product:

“This difficult choice was made to ensure we are investing in the right resources during these unprecedented times. We’ll be toasting to our fellow brands with an ice-cold Coke from the sidelines.”

By explicitly stating that a brand like Coca-Cola needs to “ensure [they] are investing in the right resources” it is clear that, while we hope things move back to a state of normalcy by the next Super Bowl, the willingness of brands to invest as considerably in Super Bowl ads as they have in the past might not be as great. The capabilities of digital, ranging from campaign targeting to data collection to goal-orientation, are going to be more important than ever. We have been building to that for a long time, and this year appears to have led us to an apex that has the potential to have lasting consequences to the media spend landscape.

Don’t Count It Out Just Yet

To make any finite conclusion based on this past year would be a fool’s errand, but that is not to say that there will not be lasting changes to result. While we can almost certainly say that companies like Coca-Cola and Budweiser will continue to be major players when it comes to campaigns like the Super Bowl, how ad dollars shift in 2020/21 to focus more seriously on data and longevity might be a permanent fixture as we continue to move ahead.