It’s ‘the End of Digital Advertising as We Know It’ – and I feel fine.

Well, this is it – it’s the end of digital advertising as we know it. And, quite frankly, I feel just fine about it. Data suggests Procter & Gamble and Unilever are pulling back on digital ad spend – MediaRadar estimates a 41% drop for P&G, and a 59% drop for Unilever year over year. This should come as no surprise following P&G’s public statements on the need for the industry to ‘grow up’ in terms of transparency in contracts, work fulfillment & reporting in the digital advertising space on the heels of programmatic display ads appearing alongside sensitive and otherwise undesirable content and sites. As more and more of the titans of the industry look to scale back their digital marketing budgets and make significant shifts in overall marketing strategy, a deluge of alarmist blog posts about the “end of digital advertising” is gathering on the horizon.

Despite the fact that blog writers have been proclaiming the end of digital marketing in one form or another (one particular favorite is the “death of SEO” articles that crop up after every significant algorithm update Google makes) ever since the very beginnings of the industry, digital marketing is alive and well – and, with transparent, proactive management, has more potential than ever before.

One of P&G’s primary pain points is the recent discovery that the contract in place with one of their agencies did not strictly stipulate how funds were allowed to be used, opening the door for the agency in question to make profit off of money allocated for media spend in addition to their management fees. As P&G dug in further, it turned out that the management fees were not sufficient to cover the agency’s costs. Transparency and clearly defined engagements in terms of contracts and scope of work are fundamental for satisfaction and success in the digital marketing space. The need for clear, open channels of communication is key. Both agencies and their clients should follow P&G’s lead and re-examine contracts and relationships in order to ensure a mutually beneficial foundation is in place with clearly defined contracts, scopes of work, open communication and reporting. Without a clear picture of not only where marketing budgets are being spent, but also what return on investment is being driven (primarily on ad spend and media buys and, on a higher level, including agency fees as well), it is impossible to justify marketing investments and continued relationships on either side. Closely related to the issue of overall transparency is issues involving client access to accounts & data – ultimately, the more open agencies are with their methods and results, the better – not only does open access lead to better potential for collaboration between agencies and their clients to take campaign performance to the next level. Improved oversight helps to minimize campaign mis-steps and further assists in clarity of communication, as the abstruse concepts of digital marketing are clarified for clients in the process.

Programmatic Display advertising is a double-edged sword – on the one hand, managing a large swath of placements in real time gives agencies and businesses massive reach into highly targeted audiences. On the other hand, due to the nature of how the technology works, it is possible for advertisements to appear alongside undesirable content such as terror and hate group propaganda. While the ad networks are taking proactive steps to weed out such content and otherwise assist brands in protecting themselves, it is vital to closely monitor display campaigns of any size, particularly as they grow in scale. The good news is, by following branding guidelines, defining highly segmented target audiences, and closely monitoring placements, advertisers can not only protect brands, but also ensure effective ad spend in the process.

While larger brands like P&G and Unilever are reexamining their digital marketing strategies and are tightening their budgets in the process, it is nowhere near the ominous development for the digital marketing industry as a whole that some blogs will make it out to be. Rather, we should all take the time to ensure solid foundations of clearly defined relationships, scopes of work, transparency & access to data, and open communication between agencies and clients. On the fulfillment side, advertisers need to ensure their clients’ needs are not only being met, but also that their brands are being protected and treated with utmost care. While we urge agencies to operate at a high level of service & transparency, the onus is ultimately on the client side to ensure their marketing budgets are being put to effective use, and that they receive their due treatment with appropriately rendered services. One way to accomplish this is to receive a second opinion from a third party. Most digital agencies will do preliminary audits for free which can elucidate site weaknesses that your current marketing efforts may have missed and prioritize areas of spend moving forward.

Post written by David Torres, PPC, CRO