With the series of redundancies by digital platforms (such as Meta’s Facebook, Snap’s Snapchat and most notably, Twitter) resulting from the decline in their digital advertising revenue, brands should be questioning if there is still any credit left in spending large sums of money on paid ads.

The truth is, the decline in digital advertising revenue is indicative of the increasing ineffectiveness of paid ads in recent years. In other words, brands who are still allocating high budgets for paid advertisements might be wasting money. Fortunately, there are better, more efficient methods in digital marketing which brands can, and should, look into to further their brands’ growth organically; the prime of which is to develop their in-house content marketing capability.

Understanding the decline of digital advertising industry 

So far, more than 20,000 employees were laid off in the slew of retrenchments by Silicon Valley in 2022. Among which, Facebook’s Meta had axed around 13% (11,000 staff) of its workforce, while Snapchat’s Snap dismissed 20%. Further job cuts, hiring freezes and other contingency plans were also executed widely across the Valley.

Meta and Snap are examples of some Big Tech companies in Silicon Valley, whose main source of revenue is generated from ad placements on their platforms. So the decrease in their revenue means brands are spending lesser for ads to be placed on Big Tech’s platforms. The seemingly obvious reason behind this is the threat of an imminent economic crisis; when companies tighten their belts in preparation for upcoming crises, advertising budgets are usually the first to be cut. But assigning blame only to the economic downturn seems too easy a way out. As with all things, there is more than what meets the eye. 

The fact is, the digital advertising industry already hasn’t been performing well since years before the looming economic crisis. Albeit yearly projected increases in revenue, a closer look at the number reveals that the industry’s growth rate is actually on a declining trajectory.

As 19th century businessman, John Wanamaker famously said: “Half the money I spend on advertising is wasted: the trouble is, I don’t know which half.”, a statement that is especially relevant in the age of digital ads. 

During the nascent stages of the digital advertising industry, companies jumped at the opportunities and potential it seemed to offer. But because the industry’s operation has always been opaque with its obscured metrics, the effectiveness of paid ads remains questionable. Therefore, it is difficult for brands to track the return on investment of their digital ad spend. To that end, brands are starting to realise the money pit they’ve been in, and have increasingly stopped betting on paid ads.

The situation for the digital advertising industry has been made worse due to the rise of privacy concerns in recent years. Paid ads can be accurately targeted the way they do because of data collection by Big Tech. Fearing that their privacy will be compromised, consumers have grown to be less receptive towards paid ads. Hence, when Apple introduced its App Tracking Transparency (ATT) feature– which gives Apple users the choice to stop apps from tracking their online activities– it was praised by users for taking a step in the right direction towards privacy protection.

Undoubtedly, the limitations placed on data collection have had a huge impact on the digital advertising industry, since advertisers would not be able to track critical data that make ad placements more accurate. With lesser accuracy, the industry loses its appeal and is unable to continue charming brands to spend on paid ads. Apple’s ATT has been estimated to result in a loss of USD 10 billion in Meta’s revenue, and USD 546 million for Snap. 

What’s next? Build an in-house content marketing team. 

In facing the decline of the digital advertising industry, it is crucial that brands venture into other aspects of digital marketing to ensure further growth for their brands. So, what should brands start doing? Instead of spending large amounts of money in paid ads with lost credibility, brands should start investing in building in-house content marketing through hiring and capacity-building. 

What is content marketing, exactly? Content marketing is the development and distribution of valuable and useful content and information that are relevant to target audiences through various means. These include emails, blogs, videos, podcasts, etc. Simply put, it is the creation of strong content that evokes the emotions of target audiences. 

The current shift of focus to content marketing is also timely, as the social media landscape simultaneously moves into a content-driven economy. The proliferation of social media and technology in the last few decades has placed consumers in the driver’s seat to decide for themselves the kind of content they wish to see. With the abundance of information users come across daily, they’ve developed mental shortcuts to sieve out only meaningful and impactful content deemed worthy of their time. Hence, information put out by brands must be meaningful and impactful– they need to tell stories that consumers can resonate with to boost brand loyalty and conversions.

Having an in-house content marketing team has several advantages that can greatly benefit brands (this article does a great job explaining them). But to summarise, an in-house marketing team does a better job at ensuring sustainable business growth, especially for brands with a strong customer base. Of course, building a strong in-house team takes time, effort and capital. But the investment in building in-house content marketing teams can certainly yield better results than paid ads.

What is also crucial is that, with an in-house content marketing team, the marketing process is made dynamic, and brands are able to better adapt to changes as the business needs evolve. 

Unlike paid ads hiding behind obscured metrics, in-house teams are able to embark on a process that lets them continuously see what are the strategies that work, adjusting them accordingly in the right direction to ensure brand growth. In other words, having in-house teams means brands are able to put out more dynamic content that can definitely connect with their ever-evolving target audience in a more effective way.

(Check out this article to find out the roles in an in-house team, areas of focus, and how to ensure efficiency of the team.)

Conclusion

Safe to say, the digital advertising industry has lost its grip on brands. While paid ads may have been effective for brands in the 2010s, the decline in its growth rate in recent years clearly indicates that it’s time for brands to stop relying heavily on paid ads. Instead, the future of brand growth calls for brands to start developing and strengthening their internal capabilities, and going beyond basic advertising to adopting a holistic approach for more sustainable and meaningful brand growth.

Tangible is a brand strategy and business consulting firm, synergising our consulting and creative offers to give clients comprehensive solutions. We believe brands are strategic management tools that should go beyond simply delighting customers. For more information on how Tangible can assist you with your branding, or other related digital services, please contact us here.

Issue 39: Q1 2022

Issue 32: Q2 2020

The post Issue 42: Q4 2022 appeared first on Tangible.

Let’s talk about what makes them who they are (unique characteristics typically observed), what drives their preferences, and zooming into two brands which have captured the hearts of the millennials.

What the millennials are about

Source: Istock Images

They are firstly described as digital natives

We have to bear in mind that they were born into a technological world and, naturally, growing up in such a defining period makes them stand out for their tech-savviness. Millennials are more likely to depend on technology in making informed decisions compared to Boomers or Gen X-ers – both generations we consider digital immigrants.

Source: Getty Images

Millennials place a huge importance in the meaning of their work

A research by Gallup tells us that they don’t work solely for a pay check, but instead focus on purpose-driven work and relationships. They also believe that the main purpose of a business should be to improve and better the society rather than the single-minded pursuit of profits.

Not surprisingly, millennials want their lives to make a positive impact, whether it be through the businesses they support, or issues that they believe in. I should also add here that no other adult generation has education qualifications as high as the millennials. They have a desire to change the world and are not shy to show their support for a cause through voluntary work, activism or by engaging on behalf of people who might not be able to stand up for themselves or speak for themselves (due to constraints such as language, backgrounds or education levels).

Influenced by their peers

Millennials are also largely influenced by their peers when making a decision. Online reviews and recommendations matter in their purchasing decisions.

Millennials’s preferences

Millennials are very happy to pay for experiences. A study by Expedia and the Center for Generational Kinetics revealed that millennials lead the charge in placing a newfound value on experiences over things – where the memory of an experience is becoming the product itself.

What is it about experiences, you ask? Well, it makes them happy. Research supports this fact that sharing experiences and making that social connection is a source of happiness that amplifies emotions.

This also ties in closely with the experience economy, with companies like Airbnb, SoulCycle and Apple doing exceptionally well in delivering unique brand experiences. They have found a way to either engage and create customer participation, or build a connection with their customers.

Watch:

It is especially important to this group that brands pay attention to being ethical and kind. Businesses that resonate with millennials should be committed to making societies better and recognise the holistic way of doing business by placing importance on the 3 Ps of people, planet and profit. Millennials ask: What is your purpose? What is your mission? What are you trying to build for the community or society?

Brands that continually refresh, innovate and improve their product offerings to make millennials’ lives better and more convenient are appreciated by this cohort. Millennials enjoy novelty and are highly experimental, this translates into their willingness to try new and original products and services.

The post Issue 34 : Q4 2020 appeared first on Tangible.

Currently, Boomers in most developed countries are the second largest demographic behind Generation X, but hold the most wealth. So, whilst Boomers are ageing, they continue to be an influential and significant demographic.

What follows are some insights and recommendations when dealing with Boomers that may help the brands and younger generations understand and manage the Silver Tsunami.

(Author’s note: Apologies this article is US biased but the exponential growth of consumerism and marketing in America makes for a rich source of research.)

Source: Getty Images

To understand the demographic, here are four Boomer traits to take note of:

1. Boomers are difficult customers:

• Boomers don’t shop to relax. Only 27% agreed with the statement: “I think shopping is a great way to relax.”
• Boomers want convenience, placing a higher value on an easy-access location, easy-to-navigate store, and easy return policies.
• Boomers have a pretty good idea of the price of things and how much they’re willing to pay, so they will call out brands they don’t see as offering value.
• Boomers perceive little difference between competing products. This contrasts with the tendency of younger demographics to assert differences between products even when clear differences do not exist.
• Boomers are the most likely to write off a retailer if the sales associate didn’t appreciate their business, if a store is messy, and if the returns policy is difficult.

2. Boomers are confidence shoppers:

• Just 12% of Boomers said they rely on family and friends to help them decide on a purchase.
• Only 37% of Boomers said they browse in-store.
• Apparently, 84% of Boomers still prefer to shop in-store.
• Boomers are less influenced by peer pressure, so ads that highlight social status don’t play well.

3. Boomers like facts & values:

• On the face of it, Boomers might seem to be contradictory – they may use coupons to save a few cents and then drive home in a Mercedes. However, the reality is just that Boomers like to apply different rules to different situations. Thriftiness is applied to basics needs, while value is appreciated more when applied to discretionary spending.
• Boomers are twice as likely as Millennials to be influenced by the popularity of an item when looking for something new.
• As they age, Boomers want more facts than they did earlier in life. Years of buying have equipped Boomers with knowledge of what to look for and what information is needed for an intelligent purchase.

4. Boomers look for meaning:

Source: Unsplash

• Boomers respond to altruistic values (This tracks with aging shifts toward stronger spiritual values in which concern for others increases).
• Boomer customers tend to be quicker than younger customers to reflect emotionally on a brand’s offer. So, if a boomer has a positive first emotional impression they are more disposed to be a faithful customer.
• Boomers are more responsive to “companies with a conscience” than younger demographics.

Boomers’ attitude to money (UK & US Centric)

Wealth by Generation. Source: Fortune

Generally, Boomers have been financially successful and are the wealthiest generation. Having benefited from high salaries, free education, soaring property and investment values, Boomers have ridden the tide of economic growth across the decades with much payoff, making them experienced long-term buy-and-hold investors.

However, Boomers are not just hoarding their wealth. According to the Innovate UK blog, Boomers want to spend their wealth rather than simply save it for future generations. Seeing how Boomers appreciate value more in their discretionary spending, they are willing to spend and invest in new things, especially on experiences, services, health, and fulfilment. In fact, Boomers spend almost three times as much on holiday accommodation when compared to their children’s generation. Appealing to what Boomers prioritise at this stage of life can help brands win over some generous spenders who are looking for value, meaning, and engagement.

So, what do Boomers look for in brands?

A 2019 survey by Digital Marketing Community asked different demographics what they wanted from their favourite brands:

• 30% of surveyed boomers reported that they want their brands to make them feel like valued customers.
• 29% indicated that they need their favourite brands to produce eco-friendly products.
• 28% of surveyed boomers mentioned that they want their favourite brands to improve their skills, knowledge and help them in simplifying their daily life.
• 26% said that they want their favourite brands to provide them with innovative products.
• 25% of surveyed baby boomers reported that they need their favourite brands to keep them updated with the latest news and products.

Morning Consult surveyed over 400,000 American consumers about which brands they thought had the highest likeability, trust, and community impact across generations of customers.

Among Boomers, three shipping brands made it to the top 5, followed by Amazon in 6^th position. Hershey’s, AAA, Tide, and Cheerios rounded out the Top 10.

1. UPS
2. Home Depot
3. USPS
4. Lowe’s
5. FedEx
6. Amazon
7. Hershey’s
8. American Automobile Association
9. Tide
10. Cheerios

Boomers and Technology (US Centric)

The “OK Boomer” catchphrase and meme might be a misconception when relating to technology (Emphasis placed for my son’s benefit).

While many digital marketers target Millennials and Gen Z, less attention is given to the older generations. This may be a mistake, given where the wealth resides; approximately 70% of all disposable income in the U.S. belongs to baby boomers and they make up the second-largest segment by size and the largest by wealth.

Source: Getty Images

Social media stereotypically targets younger demographics but that’s not the entire story. Currently, 100 million (paywall) smartphone users will be aged 45 years and over. That’s 42.5% of the market share, so don’t forget the over 50’s; you just need to design your ads differently (simpler, bigger and clearer).

Boomers prefer easy-to-use interfaces, and will likely need things explained slowly. While Millennials and Gen-Zers have shorter attention spans, older generations are used to slower TV shows, commercials.

Source: Shutterstock

Voice assistant is perfect for boomers as using hands to type is already slow, cumbersome and outdated. The ease of voice search on smartphones and smart speakers is gaining traction. It has increased from 6.4 million in 2017 to 8.2 million users (up 28.6%) in 2018 within the boomer generation.

Do’s and Don’ts when selling to Boomers

Do’s

• Keep language concise. Use bullet points, focus on value-based message and remain focused on simple messaging that is easy to understand.
• Use Facebook; Boomers use Facebook more than any other social media platform.
• Show a clear benefit; Boomers like proof your product is worth their money.
• Explain concepts in detail. Generally, Boomers prefer videos that help them understand the messages and information.
• Go mobile. Recent data show that Boomers aren’t so different from millennials when it comes to mobile phone use.
• Make it bigger & clearer: Many boomers wear glasses so keep fonts sizes bigger than 16pt. Keep the contrast up, especially on websites and make those buttons bigger.

Don’ts

• Use slang, Boomers are direct, so don’t be too clever.
• Use the word “old” or “elderly”. Many Boomers are still having fun and don’t view aging as an issue to give up on looking for fun
• Rely on chat-bots as boomers prefer real people. Boomers are keen to have clear return policies, so chat-bots are recipes for disaster.

In summary, Boomers are a big, rich demographic who have clear preferences and specific engagement needs. Ignoring them would be a mistake.

The post Issue 33: Q3 2020 appeared first on Tangible.

Gen Z. Source: Medium

Gen Zers are born from 1996-2010, after millennials. They grew up with the internet & mobile technology, hence are no strangers to social networking. Having been exposed to technology from an early age, they are very used to having information at their fingertips within seconds. As the first digital natives, they are more than comfortable with finding and comparing large pool resources online, which in turn affects their decision making. 

A Gen Zer is not confined to having only one way to define themselves. They love the concept of being “free” and are constantly experimenting with different ways to express themselves. They do not discriminate between friends whom they meet online or offline.  As such, they appreciate and value online communities as they serve as platforms for Gen Zers to connect with people with similar hobbies and causes from different walks of life. 

“Our study based on the survey reveals four core Gen Z behaviors, all anchored in one element: this generation’s search for truth. Gen Zers value individual expression and avoid labels. They mobilize themselves for a variety of causes. They believe profoundly in the efficacy of dialogue to solve conflicts and improve the world. That is why, for us, Gen Z is “True Gen.” 

It is key for companies to understand what Gen Zers are greatly motivated by – The search for truth; which plays an important role in influencing their take on consumption and relationships with brands. 

Here are 5 key points to help communicate with Gen Z more effectively:
Source: Medium

1. Create an empowering design for Gen Z

Since the birth of Gen Z, they always held answers to any questions within the palm of their hands. Having a great sense of self-reliance, they are able to discover anything they want without any help, by navigating their way seamlessly through technology.

Gen Zers are innovative ‘unique-seekers’ who like to constantly push boundaries. To better resonate with this generation, design needs to be ‘empowering’ and displayed in a way that is capable of shaping their environment, inspiring personal growth. This could be exciting for designers to play and experiment with bold colours or images that may seem clashing, yet confident. 

In a recent concept exploration of an online beauty rebranding — a scope by design to exploit the ‘unintended’; it was discovered that in the developmental phase, a bold concept with a challenger proposition of “Breaking the Rules” resonated the most with Gen Z. When designing for this audience, it is not simply about aesthetics and good looking design. It is important for Gen Zers to understand how a brand can improve their daily lives, wellness, and productivity. 

To instill loyalty in a Gen Z consumer, design needs to not only be beautiful, but functional. Content should also be adaptable across different platforms and work well in different spaces from mobile to desktop, ensuring fonts are accessible and legible.

2. Flexible Branding

Gen Z wants to associate themselves with brands that mirror their desired identities & personas. With a lifespan of less than 5 years, a brand can get dated easily. In order to compete against young emerging brands that are targeted towards the new generation’s needs, brands need to deliver consistency, reinvent themselves regularly and stay refreshed.

Brands need to be flexible, consistent and stay true to their brand values in order to keep up to date with the rapidly changing Gen Z end user. This can be attained by using designated brand assets such as colour palette, logo, and typography while still producing seasonal assets such as icons and colours to keep in trend and make the brand exciting. The entire brand can be easily refreshed with a flexible brand system in place. 

3. Sharable content

Gen Z has an absurdly short span of attention. Gen Z, the first generation born in the digital age, is so used to switching between multiple screens. They are more easily distracted than any previous generations, so it goes to say capturing their attention is no easy feat. 

The most effective way to tackle their short attention span is to design in their language – making use of short videos, image loops, text overlay images and quotes. Readable fonts throughout all platforms are a must. Utilizing vivid, eye-catching color combinations can make a brand stand out from the crowd.

Gen Z is only concerned with genuine, casual and informative content, even better if it is shareable ASAP. By making your content instantly shareable, you have an opportunity to mobilize an army of social media natives who can help boost and increase your brand awareness exponentially.

4. Real users testing

The digital age offers us opportunities to grasp real-time customer behaviour, both within a brand’s platform and on social media. Designers no longer have to hope that their design will resonate with a particular target audience as they are now able to test designs with real audiences and adapt their design as consumer behaviours. 

It is important to forge a connection and offer what Gen Z needs at all touchpoints; either through the brand’s platform or other social media platforms. In order to be genuinely consumer-centric, the only way to know if the result generates a favorable response is to test with real users and improve with new insights. However, it is important to note that what works for one brand competing for the attention of Gen Z might not work for other brands.

5. Design based on brand value

The launch of a new brand identity can revitalize an old and dated company. Any new identity should still reflect the brand’s core values & culture. Gen Z are sharp-witted and are not afraid to call out a brand on social media if it is not authentic or trying to be something it is not. 

The challenge for well-known brands to execute a brand refresh and appeal to younger customers is how close it stays to its core values. The new brand must not deviate from its core values too much, but be part company’s DNA. 

To be effective in this field of design, explore the company, study its culture and target audience in scrutiny. All rebranding has to start internally with everyone living and breathing the brand as one, so that communication to external stakeholders will be consistent and compelling. Companies can build a rapport with employees to determine the company’s vision and how it can adapt to communicate and connect more effectively with Gen Z.

The post Issue 32: Q2 2020 appeared first on Tangible.

Gen Z

This latest generation was born from 1995 onwards, with the Gen Z (current age, between 5 – 25 years old). Many of them grew up playing with their parents’ mobile phones or tablets, making them the true digital natives who are exposed to the internet, social networks, and mobile systems at an early age.

This generation is also known as the “True Gen”, people who value individual expressions and are always in search of the truth. Such motivations influence the way Gen Zers view consumption and their relationships with brands. Companies should be attuned to three implications for this generation: Consumption as access rather than possession, Consumption as an expression of individual identity, and as a matter of ethical concern.

Consumption means having access to products or services, not necessarily owning them. As access becomes the new form of consumption, people want unlimited access to goods and services, with companies like Grab which provides ride-hailing services and Netflix with its subscriptions for video streaming, creates value. Products become services, and services connect consumers.

Millennials

Millennials, known as Gen Y,  were born between 1980 to 1994 (current age, between 26 – 40 years old). This generation had ready access to cutting-edge technology from birth, iTunes, Youtube has taught them that instant gratification was just a download away.

They believe that they are entitled to actualisation and understand brand personalities better than anyone as they have grown up crafting their personal brand identities online on the once prominent social networking platform – Friendster.  Social marketing and self-fulfilment is the key to Gen Y.

Gen X

Born between 1965 to 1979 (current age, between 41 – 55 years old). They were raised watching MTV and Star Wars, and are the line between the pre-and-post-digital world. The way to market to Gen X is  “anti-marketing”. Less is more for Gen X and they devour information in sound bite-sized chunks. 

Baby Boomers

Born between 1944 to 1964 (current age, 56 – 76 years old), Baby Boomers are the biggest consumers of traditional media like television, radio, and newspapers. This generation has begun to adopt more technology by having Facebook accounts in order to stay in touch with family members and reconnect with old friends.

The effective way to sell products and services to this generation is through story form. One thing to consider is creating compelling videos to convey the brand messages and information to them. Use Facebook to reach out to them effectively as baby boomers use Facebook more than other digital platforms. 

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