It’s hard to believe it’s been 20 years since Y2K, and over the last two decades the internet and digital marketing have changed tremendously.
A year ago, marketing experts predicted that digital marketers needed to take a closer look at micro-moments on a mobile device. More and more people are using smartphones for quick interactions with brands for an average of 35 hours a week. Google defined micro-moments as the moments when consumers use their phones to learn more, do something, find a location or item, or buy a product or service.
Marketing teams that took a closer look at how to interact with consumers during these micro-moments were leaders, especially if they incorporated voice search technology and chatbots. Micro-moments are not over. They should be part of your marketing plan for 2020, but what else should you be paying attention to? What’s in store for 2020? Where should you be investing time and your marketing budget?
70% of Digital Ad Spending Will Go to the Media Giants
As marketing teams look to reach the largest and most relevant targeted audience possible, they’re going to go with the three media giants more often. In 2020, the bulk of a brand’s marketing budget is going to go to one of three companies that are dominating the media. It’s estimated that 70% of a company’s advertising budget will be spent on ads with Facebook, Google, and Amazon. Facebook is still big, but it has been declining, so it’s time to consider your options.
Do not overlook two sites that are quickly gaining ground. In 2019, Snapchat and Instagram started drawing more users. Facebook started declining due to news of breaches and privacy issues. While time spent on Facebook each day dropped from 36 to 34 minutes between 2018 and 2019, Snapchat and Instagram found users spending more time on their sites. That’s expected to keep increasing in 2020 and 2021. It’s a good time to consider looking into marketing on Instagram and Snapchat.
Search giant Google continues to dominate the advertising space. With more and more competition, however, 2020 will continue to see price increases for pay per click Google advertising, requiring a closer watch and skillful team to ensure every dollar spent is maximized.
Privacy Concerns Are Going to Impact Targeted Advertising
At the same time that people are cutting the cord, laws are changing regarding targeted advertising. In 2011, the European Union passed a directive requiring any website to fully explain a consumer’s rights regarding tracking cookies and stored information. U.S. websites that have European users or visitors also have to meet this requirement.
If you’re in the U.S. and don’t think the EU requirements apply to you, you need to think again. In recent months and years, consumers have been focusing heavily on their privacy. Google Chrome is helping them, as are browsers like Brave and ad blockers. Many hacks and breaches have people concerned about the variety of personal details sites are storing. If you’re advertising online and ad blockers are keeping users from seeing your ads, you’re wasting money.
One of the biggest changes to 2020 marketing strategies is the focus on “walled gardens.” People are going to invest more in advertising in areas where companies already have massive lists of consumers you can reach. Google, Facebook, and Amazon all have advertising platforms that are examples of these walled gardens. Invest in them and you gain access to thousands and thousands of consumers.
Consumers Want Real-Time Responses
One of the biggest marketing mistakes brands make is ignoring real-time responses. In today’s hurried world, people don’t want to wait. If they need help, have a question, or want to share a concern, they want to do it right now. They don’t want to send an email and wait days or even weeks for a response.
Chatbots are gaining ground and will be an even bigger deal in 2020. Amazon’s already showing how effective they are. Customers send a message via the chatbot, get help immediately, and are directed to a human if the chatbot can’t solve the issue. Chatbots are useful at saving time answering frequently asked questions and saving the live customer support representatives for more complex issues.
Another aspect of the real-time response is something Walmart is testing. More online retailers are going to start using real-time inventories to draw shoppers. If a shopper is looking for a specific item, they find it easier to check a store’s inventory before driving miles out of their way. Real-time inventory response is in high demand and boosts customer satisfaction. If an item is out, Walmart’s system goes a step beyond and tells shoppers when it will arrive if they order it right now.
5G’s Entrance Requires Marketers to Prepare for the Speed Increases
In 2020, 5G mobile networks will advance into more areas. It won’t be everywhere at first, but 2020 will see the start of it. As this happens, marketers need to keep up with faster speeds and response times. If you’re not placing some of your marketing dollars on improvements that ensure apps and mobile sites can meet these faster speeds, you’re going to lose out. Lags with sites and ads will drive consumers away. You’ll lose out to companies and brands that had the foresight to keep up with the increased demand for faster, fluid loading times with all mobile sites and apps.
It’s estimated that 9.5 million 5G phones will be sold by the end of 2019. That number will rocket to almost 74 million in 2020 and 424.5 million by 2023. You can see how quickly consumers will embrace 5G technology through those sales estimates. Marketers who want to stay ahead of the competition need to start making and implementing plans during 2020.
At the same time, you also gain a lot with 5G. You’ll be moving into territory where graphics are going to be even better. Interactive technology on 5G speeds is going to make it easier for consumers to interact with your brand. You also have phones and tablets on a 5G network that can do more and go further than in the past. It’s going to be a new, exciting experience for everyone.
Streaming Music Services Are Increasing Time Spent Listening to Online Audio
When Hulu and Spotify came out with a $10 bundle that paired Spotify’s premium music and podcast streaming service with Hulu’s television and movie streaming service, they both gained subscribers. Between the fourth quarter of 2018 and the second quarter of 2019, Hulu gained 1.8 million subscribers, but Spotify gained 5 million. The number of people listening to Spotify in their office, at home, or in the car is growing rapidly.
Marketers need to start looking at the possible reach they can have if they advertise on audio streaming platforms like Spotify, Pandora, Google Play Music, and iTunes. The potential audience you can reach is massive.
Increases in TV/Movie Streaming Users Change How Advertisers to Reach Their Target Market
Statista reported that 31 million households had cut the cord and were relying on non-pay TV options. Cable and satellite companies lost more than 2.8 million customers during the year. It’s a trend that continues to grow. Why pay for cable or satellite service if you’re only watching a handful of the channels in the package you receive?
Some streaming channels do charge a monthly subscription. Netflix, Hulu, and Disney Plus are examples of those channels. Instead of paying hundreds per month for dozens of unwatched channels, consumers pay $5 to $15 a month for shows and movies. Other channels, such as Tubi, Roku, and Pluto, are free and offer hundreds of TV shows and movies. With internet service, people have plenty to choose from without paying hundreds of dollars on unwatched channels. Companies who’ve been reliant on placing ads during prime time or day time TV shows on cable or satellite need to rethink that strategy.
Hulu, YouTube, and many of the free streaming channels do have a limited number of advertisements that play at specific points during a show or movie. Others, such as Hulu Ad-Free or Netflix offer a plan that eliminates ads completely. Your marketing department has to think about the target audience and how to best reach them. An ad placed during the local news on cable television may not reach as many as you’d think. You might do better placing a YouTube ad to a targeted group.
Another area cord-cutters are turning to are live streams. While the numbers for live streaming videos didn’t take off in 2019, it’s expected there will be an increase of around 48% in 2020. Twitch is one of the areas where growth is going to be noticeable. The company started pushing for new recruits, even nongamers, by coming out with an app designed to make it easy for the novice to live stream videos. YouTube, TikTok, and Facebook are other avenues for live streaming. Marketers need to pay close attention to their target audience and reach out to them through live streaming avenues in 2020.
Consumers Are Turned Off by Political Ads
The 2020 election is going to have a polarizing effect on digital marketing. First, an influx of political ads online, on TV channels, and on radio/audio streaming services will drive up prices. Marketing agencies will be paying more for ad time.
At the same time, consumers have proven they don’t want to see it. A CivicScience survey found that around 75% of today’s consumers didn’t want to see political ads on television or Facebook. Only 2 out of 10 consumers admitted they don’t mind political posts on Facebook. Digital marketing campaigns must tread carefully to make sure they’re not losing potential consumers by having an ad show up in the wrong place.
You may decide that Twitter is the safer bet as that company is banning political ads, but that doesn’t mean that you won’t have political arguments playing out around your ad. That can be just as detrimental. Careful consideration of ad placement is going to be key this election year.
Retailers and Brands Gain Control by Trusting in RaaS Providers
It’s not shocking to hear that Amazon is dominating the shopping market. Amazon is convenient. Shop at any hour of the day or night and get in touch with the customer messaging assistant at any hour. If the chatbot can’t help, it connects you to a customer support agent. Some areas even allow consumers to pick up orders at a nearby location. Convenience is key in this busy world.
For retailers and brands to compete, retail-as-a-service (RaaS) is gaining ground. You’re able to customize the components of service that meet, and even exceed, the things you know your consumers want. It creates the optimal experience from searching and choosing a service or item to completing the sale and getting help when needed. With RaaS, consumers see if you still have the items they need. They can shop online to pick-up in-store or track items along the delivery route. You can make it possible for them to pay in your store, which heightens their desire for security by not having to share banking information online. You customize the experience your consumers get from the point of initial contact to the follow-up satisfaction survey.
User-Generated Content Draws Consumers
Younger generations are especially active with companies that have the same beliefs. Gen Zers and millennials feel good when their actions help someone else. They like interacting and finding companies that support similar causes or that have the same concerns. Being able to interact on a personal level with these brands is vital.
You want to connect their way. Consumers are on social media. American Eagle’s Aerie tapped into consumers’ annoyance with edited photos and airbrushed models. For their swimsuit line, they asked consumers to take and share photos wearing an Aerie bathing suit. Every time a person shared a swimsuit photo with Aerie’s hashtag, Aerie donated $1 to the National Eating Disorders Association. The campaign was a huge success and led to other Aerie REAL campaigns.
A social media campaign where consumers participate can help others, give discounts, provide a prize, or combine a few different ideas. Consumers feel important to your brand and the world around them. You reach your established followers and gain new ones. It’s a win-win situation and digital marketing trend that will continue to grow in 2020.
Let’s Chat Marketing
There’s many other big changes coming to the marketing landscape, and as 2020 officially kicks off, we’ll continue to see more as the year progresses. Give us a call to talk about your marketing strategy and make sure you see the greatest ROI possible by keeping up with changing trends and technology.