Digital advertising moves fast—gone are the days of one-size-fits-all strategies and relying on a single platform. The way we allocate our budget has become a critical determinant of success, which is why understanding the nuances of ad spend is paramount.
The crux of the matter? Diversification. When it comes to your digital ad spend, diversifying your investments across various marketing channels is the key to maximizing your returns and staying ahead of the competition.
This is your comprehensive blueprint for diversifying your digital advertising spend. We’ll explore the significance of ad spend, the importance of diversification, and how you can strategically allocate your resources across various digital platforms. By the end, you’ll have a solid understanding of how to craft a diversification marketing strategy that optimizes your ROI.
The Changing Landscape of Paid Advertising
The digital advertising landscape is in a constant state of flux, shaped by evolving consumer behaviours, emerging technologies, and shifting industry trends. To make informed decisions about ad spend diversification, it’s essential to comprehend the dynamic nature of this ever-expanding domain.
In short, consumer behaviour isn't what it used to be, and neither should your paid advertising strategy.
Innovations in technology, such as Artificial Intelligence, augmented reality, and machine learning, are revolutionizing the way ads are created, distributed, and measured. Changing regulations have also placed a greater emphasis on data privacy and user content, especially on social media. Advertisers must adapt their practices to comply with these regulations while maintaining effective targeting and personalization.
The internet is an always-evolving machine that stops for no one—keep up!
Navigating Uncertainty: A Looming Recession
Let’s face a hard truth: there’s a recession looming. Canadians know this and are feeling the effects, from sky-rocketing grocery bills to ridiculously high interest rates.
In 2023, a staggering 74% of global brands acknowledged that signals of an economic turndown are influencing their media budget decisions. This heightened sense of caution is not unwarranted, as 2022 saw a 649% increase in tech layoffs. Industry giants, like Cisco, Asana, Amazon, Salesforce, Meta, Twitter, Microsoft, and Oracle were among the companies forced to downsize.
In this uncertain economic climate, diversifying your digital ad spend takes on a newfound significance. Instead of resorting to traditional advertising approaches that may be more cost-intensive, now is the time to spend smarter and get creative. Diversification offers a good opportunity to advertise efficiently and reach audiences in innovative ways.
Conversion rate optimization (CRO) is one strategy that becomes especially vital during economic uncertainty. It allows marketers to make the most of their resources and convert at a higher rate, ensuring that each dollar invested in advertising is maximized for impact.
Understanding the Diversification of Ad Spend
Think of diversification as not putting all your eggs in one basket. At its core, digital ad spend diversification is a deliberate strategy that involves allocating your advertising budget across multiple channels and platforms to reach a broader and more diverse audience.
The main objective is risk mitigation. By segmenting your ad spend, you’re effectively insurance-proofing your marketing strategy, reducing over-dependence on a single channel.
Benefits of Diversification
- Improved Reach: More platforms mean more eyeballs and engagement.
- Higher Engagement: Each channel has its unique strengths, offering a more tailored approach to connect to your target audience.
- Potential Cost Savings: Some platforms offer more bang for your buck.
Beyond the Mainstream: Exploring Diverse Advertising Platforms
Social Media Platforms Beyond Meta
The time has come to look beyond the behemoth of Meta.
TikTok has emerged as a game-changer for digital advertisers, offering a unique and dynamic platform to diversify marketing spend. It’s particularly effective in reaching younger, tech-savvy, and highly engaged audiences.
On accounts with 100k followers or more, the engagement rates tell the story: TikTok stands at 5.3% compared to Instagram‘s 1.10%. Moreover, TikTok's CPM (Cost Per Thousand Impressions) is $8 compared to Meta's $14 CPM.
Other options to diversify digital spend include Snapchat and Pinterest. Snapchat’s unique ad formats, like AR lenses, provide brands a more creative way to stay out in a competitive space.
Don’t sleep on Pinterest advertising either, which is perfect for lifestyle, fashion, and home decor brands to reach a specific user base and leverages users’ purchase intent.
Video Sharing Platforms
Video sharing platforms have surged in popularity, becoming epicentres for digital content consumption. Diversifying your ad spend to encompass these platforms is a strategic move for several reasons.
Platforms like YouTube, Vimeo, and Dailymotion draw billions of viewers daily, offering an expansive audience eager to engage with video content. The visual storytelling element of video content is powerful—from conveying your brand’s message, to product demonstrations, advertisers can craft compelling narratives that resonate with viewers and boost brand awareness.
Gaming Platforms
Evolving far beyond entertainment, gaming platforms are becoming strategic territory for advertisers looking to diversify ad spend.
Over 5 million people watched the League of Legends World Final in 2022—that’s more than double the 2023 Stanley Cup Finals. The 'Free to Play' model has lowered barriers to entry, and eSports are gaining huge viewership. Whether you’re looking to advertise in-game or on gaming-centric platforms like Twitch, this is most definitely an avenue worth exploring.
Voice Search
Voice-enabled digital assistants are rapidly reshaping the way consumers seek information. Adjusting your diversification strategy to incorporate this auditory medium is essential for staying at the forefront of digital marketing.
In 2023, 41% of U.S. adults used voice search daily, with voice search shopping expecting to cross the $40 billion mark.
Voice searches tend to be more conversational, providing the opportunity to target long-tail keywords. Many are also location-specific, making it a powerful tool for local businesses.
Digital Out of Home (DOOH)
This form of digital advertising leverages digital displays, including billboards, transit screens, and digital signage, to showcase dynamic, eye-catching content. Essentially, it’s a real-world alternative to online advertising.
In Canada alone, there are 31,000 DOOH screens, and this number is only going to increase.
DOOH has always been a worthwhile investment, but especially now. It’s resilient to common online advertising issues like ad blockers and third-party cookies, and most importantly, it has the ability to update content in real time, allowing advertisers to stay relevant and respond to changing circumstances.
Connected TV (CTV)
With almost 90% of U.S. households streaming from connected TVs, the age of cord-cutting is upon us. CTV offers more control over ad viewing as they can't be skipped, providing a more captive audience. Capitalize on this by reallocating traditional TV budgets to digital platforms and meet your audiences where they are.
Audio and Podcast Platforms
Spotify’s audio ads can be targeted to users based on their music preferences and behaviours.
Meanwhile, podcast advertising is sponsored or produced by brands to engage with a specific target audience. Both offer an engaged audience with a higher purchasing power, as well as higher recall rates compared to display ads.
E-commerce and Marketplace Platforms
Diversifying your ad spend to include e-commerce and marketplace platforms like Amazon, eBay, and Etsy is a strategic move, particularly if you operate in the retail or e-commerce sector. Advertising on these platforms connects you directly with consumers actively searching for products with a clear intent to purchase.
Search Engines Beyond Google
Alternative search engines like Bing and DuckDuckGo attract unique user demographics. Bing, for example, is popular among older internet users and professionals, while DuckDuckGo focuses on privacy-conscious individuals. Target niche audiences with less competition!
Why 2024 Is the Year to Diversify Your Advertising Spend
Are you ready to embrace diversification as the cornerstone of your paid media success?
As 2024 approaches, it’s time to take action. In a landscape driven by agility and innovation, staying ahead requires adaptability and creative thinking. Don’t miss the chance to amplify your reach, reduce risk, and maximize ROI with an improved diversification marketing strategy.
Not sure where to start? The Influence Agency specializes in creating diversified ad spend strategies that embrace innovation rather than shy away from it. Our in-depth market research and audience analysis capabilities ensure that every penny of your ad spend is put to optimal use.
Don't leave your 2024 marketing success to chance; get in touch with us and let’s build something remarkable together!