Why digital marketing has become more expensive in the last few years
6th February 2015

dollarupYou want to promote your product or service online? You now have more options and tools than ever before. But it has also become more expensive. Earlier you could quite easily do a decent job with just a couple of? hundred thousand rupees but not that is just the ante in the game. And the game has changed.

Intelligence - the most important reason for increased marketing expense.

In the old days it was a numbers game. You used SEO to game the system or you covered a wide enough set of keywords to create a large funnel or you sent out mailers to a huge un-targeted audience. Options for promoting your site were limited and you did not need a highly intelligent team to handle things. Social media did not exist. Cut to now, every? marketing aspect has to be handled intelligently.  Its more important to understand the 'why' of the promotional step than the what, where or how. To create a viable digital marketing campaign you need to have brains backing up the brawn. Brains cost money. You need intelligent project managers, writers, social media experts and SEO? generals to create a viable campaign.

The near death of SEO. Google's push for the ad market.

SEO is not dead but it did have a very close shave. It's still pretty much in the ICU. Google has systematically taken away the advantage from SEO generals and has ensured that marketers are forced to go towards their ad words offering. SEO agents nearly drove themselves (and their clients) insane trying to adapt to Google's algorithm changes but now they seem to have caught on. The game has changed. Earlier SEO used to be one of the most cost-effective online marketing tools ? and accounted for up to 60-80% of a campaign budget. No more. Now it would be close to 20-30%. Instead now the budgets are distributed among Social, PPC, Content development, SMS marketing, Targeted email campaigns, re-marketing and a myriad other tools.

Multiple channels have given rise to multiple cost items.

Its easier to negotiate and streamline costs when a few avenues are used for marketing. Bulk discounts and efficiencies of scale can be used to garner good value from marketing sources. But with distributed costs among various channels it is now very difficult to get efficient deals as a little has to be spent at different places and no channel gets the volume it used to get. Yes, for multi client agencies there are always ways to create efficiencies across clients and campaigns but the variation in the needs of different clients create a very non-uniform demand pattern. In simple words, finding common ground between campaigns to leverage costs is difficult.

Rise of out of the box campaigns and very niche concepts

To stand out from the clutter, marketing agencies are increasingly having to create unique properties and concepts. These concepts can be so unique that normal channels have to be heavily customized to accommodate them or worse, normal channels cannot be used. Creating and implementing these unique campaign assets is very expensive.

If you don't have a healthy budget, go home.

Don't want to spend? Don't come out to play. It's as simple as that. No matter what you read about marketing on a shoestring budget or any kind of 'marketing hacks', a truly sustainable campaign needs a large budget. Over a long period of time as well. It's the long game or no game at all.

Cheers,

Ron

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