Dissecting Digital Services - Local Media Association · ONLINE MARKETING SUPPORT SEO Blog Management Site Visitor Analytics Email List Purchasing ... Digital Marketing Services WEB

Dissecting Digital ServicesWho’s Buying What

September 2017

The 3 things we will cover….

• Things you probably know– It’s a big market & growing– It’s a fragmented market

• Things you might not know– Not every market or category is the same– Lots of time & money being spent

• Things you SHOULD know– People doing the buying are rookies– They are getting fed up

How much money will be out there?

Ummmmmmm……….a lot

$ = $1 Billion

Cutting to the chase…..

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

Advertising Digital Services

2018 U.S. Estimated Expenditures

Advertising Digital Services

$346 billion $708 billion

2018 U.S. Estimated Expenditures

WEB PRESENCEWeb Design/Maintenance

Web HostingOnline Advertising Management

Mobile Media ManagementSocial Media Mgmt

ONLINE PUBLIC RELATIONSEmail Management

Digital Press Release DistributionReputation Mgmt

Opt-in List ManagementONLINE MARKETING SUPPORT

SEOBlog Management

Site Visitor AnalyticsEmail List Purchasing

Listings ClaimingONLINE AD PRODUCTIONOnline Agency/Exchange Fees

Online Ad DesignApp Development

Online Contest/Game DevOnline Video Production

ONLINE CONSULTING AND RESEARCHOnline Consulting Research

ONLINE CONSULTING & RESEARCH8.6%

ONLINE AD PROD19.7%

ONLINE MARKETING12.2%

ONLINE PR8.5%

WEB PRESENCE51.0%

Half of Digital Services is inside of Web Presence

By the end of 2017,

$661.4 billion

Roughly…

$301.5 billion by local businesses

$359.9 billion by non-local businesses

WEB PRESENCEWeb Design/Maintenance

Web HostingOnline Advertising Management

Mobile Media ManagementSocial Media Mgmt

ONLINE PUBLIC RELATIONSEmail Management

Digital Press Release DistributionReputation Mgmt

Opt-in List ManagementONLINE MARKETING SUPPORT

SEOBlog Management

Site Visitor AnalyticsEmail List Purchasing

Listings ClaimingONLINE AD PRODUCTIONOnline Agency/Exchange Fees

Online Ad DesignApp Development

Online Contest/Game DevOnline Video Production

ONLINE CONSULTING AND RESEARCHOnline Consulting Research

Digital Marketing Services

WEB PRESENCE ONLINE PR ONLINE MARKETING ONLINE AD PROD ONLINE CONSULTING & RESEARCH

$58.6

$161.8

$87.6

$52.8

$347.1

$56.8

$130.0

$81.0

$56.3

$337.3

2017 2018

Projected Growth 2017-2018

$ in billions

+2.9%

+3.0%

+24.5%

+8.1%

-6.2%

+7.0%

© 2017 Borrell Inc. ALL RIGHTS RESERVED.

Internal/Self3%

GoDaddy5%

CDK Global3%

Google, 2%

Wix, 1%

hibu, 1%

Wife

Son-in-law

Relative

Notables

Who Handles Digital Services For Local Businesses?

Source: Borrell’s Annual Survey of Local Advertisers; April-June 2017; N = 1,460 responses

Digital Services is a hugely fragmented industry, with 97% of local businesses outsourcing.

Big-name providers such as GoDaddy, Wix, Squarespace, CDK Global, and Web.com

collectively hold only about 10% of the market.


10t web design 11-11 media 3 rock marketing 321 blink advertisng agency 445 digital 671 coupons 97 displsay ackmann dickenson adaptly adwerx amazing7/seo andrews media ventures angie's list asheville citizen times atlantic coast computer solutions avero back at you media backus marketing bam bbd marketing bconnected llc beaver county times bell tower advertising

You indicated you outsource Web Services, who do you outsource to?


1&1internet1919marketing30 days marketing campaign (canada)5 start reviewabbey carpetacs printing servicesactive campaignad taxiadobeagent personal assistantaiken standardall internal workallstateameriprise (corporate)anderson consultingari art of coolaspen marketingat&tautoloopautopointbandsintownbanner-ellucianbbd advertinsgbellybenchmarkbkvblackbaud

…the individual who designed our

awful website

You indicated you outsource Email Services, who do you outsource to?



• Things you might not know– Not every market or category is the same– Lots of time & money being spent


When it comes to all things digital….

• Online Advertising

• Online Promotions

• Online Marketing Services

Let’s divide expenditures into 3 bucketsTargeted DisplayROS DisplayEmail AdvertisingPaid General SearchPaid Listings SearchOnline AudioOnline Video

Web PresenceOnline PROnline MarketingOnline Ad ProductionConsulting & Research

CouponsProximity Marketing

SamplesWhite PapersSponsorships

Event MarketingLicenses

Loyalty ProgramsGames

Differences in HOW markets spend on digital

Memphis, TN Burlington, VT

Digital spend HERE is 8.5 times larger than HERE

Tallahasee, FL Sioux Falls, SDColleges and Universities All Other Business LocationsAll Other Business Locations PharmaciesGovernment BanksDotCom Businesses TelecommunicationsGeneral Merchandise Stores Automotive Sales

Online Video Production

Rochester, NY Lafayette, LAAll Other Business Locations Retail JewelryFood Stores All Other Business LocationsAutomotive Sales Eating and Drinking PlacesTelecommunications Real Estate ServicesRetail Optical Goods Hospitals

Online Ad Design

Greenville, SC Ventura, CACredit & Mortgage Services All Other Business LocationsAll Other Business Locations Employment ServicesEmployment Services Radio broadcasting stationsHospitals Automotive SalesRetail Home Improvement Retail Home Electronics

SEO1.5x as large as

4.7x as large as

Roughly the same as

Differences in biggest spenders…..By city…..

By digital marketing service…..

And differences by SIZE of businessesSalem, ORGRAND TOTAL

100 or less emps

25 or less emps


The Gold in Digital ServicesWhat Local Business Spend Annually

*Average annual expense for local businesses surveyed from April-July 2017Source: Borrell’s 2017 Local Advertiser Survey; N = 3,551 responses from all advertisers, 250 responses by franchisees; 189 real estate agents; 354 health care providers; 194 restaurants/bars; 1,652 tiny businesses (10 or fewer employees)

*


The Gold in Digital ServicesWhat Local Business Spend Annually


*

Real estate agents spend half as much on

advertising as the typical local advertiser but nearly

2x the average on management fees for

their social media pages.

Even businesses with 10 or fewer employees

are spending large amounts of money on

social media management.


The Gold in Digital ServicesWhat SMALL Local Business Spend Annually


*

Less than 5 5-24 emps

$5,400

$1,700

$12,400

$6,800

$1,900$935

Email Services Social Media Services Web Services



• Things you might not know– Not every market or category is the same– Spend varies by size of business as well



70% Are Loners Of those with the least marketing

expertise, 70% make marketing decisions without anyone’s help.

Sources: Borrell’s Annual Survey of Local Advertisers; April-July 2017; N = 3,039 responses; & Borrell’s monthly advertiser panel, 208 responses

Rating the marketing experience of 3,039 local advertisers

Rookie MarketeersInexperienced Advertisers Making Their Own Decisions


A Huge Time Suck for SMBsInternal Hours/Week Spent on Marketing


The average local business manager

spends the equivalent of nearly 1½ days a week on marketing activities.

A business with 10 or fewer employees

spends nearly one full day on marketing

activities. Imagine that!


Calculating return on investmentBudgeting or finding money to fund programsFinding time/ resources to focus on marketing

Generating quality leadsConverting leads into customers

Capturing audience attentionUnderstanding how web metrics matter to your bottom-line

Getting accurate data from media partnersIncreasing customer engagement/ loyalty

Coming up with the overall marketing strategyReaching a targeted audience

Knowing all your options when it comes to advertisingProducing creative campaigns

Launching marketing programs at the right timeFinding quality partners

Developing content piecesDetermine who to advertise to

Other0% 10% 20% 30% 40%

Hardest Easiest

ROI is the hardest marketing objective to establish

Source: Borrell’s 2017 Local Advertiser Survey


33

42

74

76

81

90

92

133

185

Q. Which of the following are your largest concerns when it comes to digital marketing? Choose your top three concerns. Please prioritize these by selecting "1" for your top concern, "2" for your second largest concern, and "3" for your third largest concern.

Keeping up with the latest advertising trends

Finding quality ad production at a price I can afford

The number of digital devices / formats an ad needs to be designed for

Ad fraud / click fraud

The rise of social media

How increasing mobile use impacts my campaigns

Choosing the right advertising company to meet my needs

Ad blocking software

Other

And when it comes to digital marketing…They feel they are falling behind


Newspapers Broadcast TV Cable TV Radio

Used Media 59% 21% 21% 38%Was Online Offered? 75% 72% 67% 57%Was Online Used? 61% 53% 49% 45%

Effectiveness (Very/Extremely)

0%

13%

25%

38%

50%

Newspaper Broadcast TV Cable TV Radio

Media Only Media + Online

But…..they know digital enhances(when offered)


BUT….


"We want to see empirical evidence that our digital marketing spend is productive." "Internet marketing is extremely expensive. I have tried it extensively and have not had good results. I am having better results from a local magazine with my listings advertised in it." "The data showing digital is not as effective as promised. Frankly, our TV and Radio are doing well for us, but everything you read indicates you must put more on digital and I'm not sure that's correct now" "Getting social media right. Skeptical about ROI of digital advertising. " “Social media campaigns that do not turn negative."

Source: Borrell’s Business Barometer May 2017

There’s a storm a-brewing…



• Things you might not know– Not every market or category is the same– Spend varies by size of business as well


Over $300 Billion spent by local businesses

Spend varies by: Location, Business Type, Business Size

Overall growth of 7% in 2018

Ignorance is bliss…….

If nothing else……

Thank you

Documents

Dissecting Digital Services - Local Media Association · ONLINE MARKETING SUPPORT SEO Blog Management Site Visitor Analytics Email List Purchasing ... Digital Marketing Services WEB