According to its latest annual Entertainment & Media Outlook report, PwC predicts that digital marketing will finally overtake traditional advertising over the next three years.
You don’t even need to ask why. For the past decade or so, digital commerce has been growing at an unprecedented rate. And, aside from the fact that more people are now making purchases directly from online stores, an even bigger number conduct most of their information search online, forcing marketers to take their ads to the web.
Challenges for traditional ad agencies
One sector that has been seriously affected by this trend is traditional advertising. In the face of an evolving market and increasingly digital-oriented consumer, these agencies have found themselves struggling with:
- Creating emotional connections
Digital consumers have a huge chunk of information at their disposal. These consumers are bombarded with brand messages from every corner of every channel. The result is a consumer who is wiser than the traditional tactics marketers use in evoking emotional resonance.
Recent studies show that 84% of today’s consumers skip TV ads. The reason for this is that today’s consumers are more interested in highly targeted ads that specifically address their needs. This calls for a high level of personalization – something traditional ad agencies aren’t used to.
Traditional ad agencies that have for a long time preached their “difference” are now finding it difficult to gain new customers or retain the existing ones. That’s because in the past they only needed to be different from their local competitors, but now these agencies have to compete on a global scale.
Overcoming these challenges and finding a place in the digital world
The good news is that a majority of ad agencies have started taking steps that should ultimately enable them to overcome these challenges and succeed in the digital world. These steps include:
- Finding a focus
With increased competition in the industry, trying to be everything to everyone can easily lead to failure. Ad agencies are therefore trying to identify where their strengths lie and focusing their efforts on a particular audience rather than trying to reach everyone.
- Investing in education
There is a substantial disconnect between traditional training and the real word. So, a number of agencies have been actively training and evolving their workforce to make up for this knowledge gap.
- Remodeling their business strategies
The sequential, step-by-step marketing process designed to execute on a predefined set of variables no longer works. In its place, ad agencies are opting for an “adaptive” approach that requires constant measurement and optimization – also known as a test-and-learn approach.
Over time, any advertising agency that adopts these three tips should be able to fully evolve its processes and, by so doing, redefine its position in the industry.
Now more than ever, ad agencies need to invest in top talent. They need people to help them get over the hump. They need thinkers. That’s why, going forward, the demand for digital marketing degree holders will only increase. Digital marketing experts are the key component to facilitating the adaptation that ad agencies need to undergo.