Building a Brand Online: The Golden Age of Digital

This post is based on a talk I gave at our SearchLove conference in Boston last week. It ties quite closely with the post my colleague Ron Garrett wrote last week: Search Marketers Need to Evolve. You can probably tell we've been doing a lot of thinking about this.

When I gave this talk at SearchLove, I hoped that it would put in context why we bring such a range of speakers and topics together at our conferences and to inspire the attendees to go back to their companies and make real changes. I hope this post will do the same for you.

Photo by Zwickerhill Photography

As digital marketers, our focus on analytics has served us well in driving direct, measurable sales. The dominant form of brand marketing, however, has remained offline with TV taking the lion's share of the budget and attention. We believe that as TV faces disruptive technology and business models, digital marketers have an opportunity to grow their influence and impact. In total, this is an opportunity worth tens of billions of dollars a year.

I'd very much like for us—our industry—you and me—to be the ones who benefit.

Despite all the growth we have seen in digital marketing spend, I think that we are only just entering what I'm calling the golden age of digital.

Building brands online first

We're entering the age when the biggest brands in the world will be built online first. I hope to convince you of two things: first, that this change is happening right now. And second, that we are the people to win in this world.

Starting at the beginning

There are some confident statements above, but the last few years have had their share of introspection and crises of confidence. We've put a lot of time and energy over the years into understanding the direction marketing is moving and capitalising on the shifts. Duncan and I originally started by thinking that networked computing was going to be a big deal and then started our company initially on the back of a simple CMS that we built to help small business owners take advantage of the self-publishing revolution.

Photo by Zwickerhill Photography

As we shifted gears to focus more on the dominance of the search channel, we started trying to understand where Google in particular might be taking things.

We've written plenty about that over the years, but we were talking about effects similar to Panda, Penguin, and Hummingbird years before they actually came to pass. Panda and Penguin started making our vision come true. We were more effective search marketers than we'd ever been because we'd largely bypassed building the infrastructure for search as it was and tried to build it for how search would be.

And yet something was wrong.

Powerful content was becoming ever more effective. And yet the greatest examples of content that we were seeing at search conferences weren't built by SEO agencies.

Brands were getting a bigger and bigger advantage in search. And yet the best brand builders weren't SEO agencies.

For a long time, we've talked about how "SEO" isn't a verb. You don't "SEO a website." Ranking well is an outcome, not an activity. It's like fame. "Famous" isn't a verb. You don't "famous someone." You get famous for doing other things (playing sport, performing music, appearing on TV). SEO is the same.

But what if we weren't the right people to do those things for people? What if we weren't the world's best PR firm, branding agency, or creative producers?

Don't worry. I got over my insecurity. I believe the capabilities that we have been building are going to grow in power and influence. Here's how:

The Innovator's Dilemma

It was Mark Suster who kick-started my confidence with his talk in San Diego [use this link and sign up for an account to get access to the video for free]. He's an entrepreneur-turned-investor. He's smart and opinionated.

He talked about maker studios at our conference. You might have heard a few weeks ago that Maker Studios sold to Disney for half a billion dollars.

Maker is a producer and distributor of online video. The turning point for me was in realising that the forces they were betting on were also rampaging towards our quirky, exciting, geeky little corner of the marketing world.

There's a book called The Innovator's Dilemma by a Harvard Business School professor named Clayton Christensen. It's a little dry, but if you're interested in business theory and technology, it's an absolute no-brainer: You should read it.

It describes two kinds of innovations that hit established markets. So-called "sustaining innovations" make existing processes faster, cheaper, or better. They can be very dramatic, but Professor Christensen's research shows that they almost always end up benefiting the incumbent players in the market.

In contrast to "sustaining innovations" stand "disruptive innovations," which are those that attack problems an entirely different way. They typically don't work as well as the existing solutions, perhaps solving only part of the problem, but have a structurally different cost. So they're "cheaper but worse."

Cheaper but worse

Doesn't sound too compelling, does it?

That's what the incumbents think. They may spot a potential opportunity, and may even pay lip service to the idea that they should be pursuing it, but ultimately, their economic incentives are skewed towards maintenance of the status quo.

Therein lies the dilemma.

There's often a subset of the market, for whom the new service is "good enough." It may not be gold-plated, but it solves their immediate needs and they can afford it. As they invest, it gets better and better, capturing more and more of the market opportunity until it's meeting the core needs of even the top end of the market while still being structurally cheaper. Money cascades to the new entrant and leaves the incumbents high and dry.

Let's go back to the "cheaper but worse" innovation for a second. To me, that sounds an awful lot like the idea of building a brand online. Let's look at the details:

• The established way of building a brand for a generation has been via mass market TV advertising and other classic above-the-line spend. Spends of $100m+ are not uncommon.
• Building a brand online is cheaper, yes, but right now, not as effective.
• The incumbent brand-builders pay lip service to digital, but when you look at their corporate structure, their fee structures, and their economic incentives, and you realise that they'd far rather see TV get bigger than have to do all this messy web marketing.

So I think there is a disruption coming to brand marketing, and I don't think it's going to benefit the big guys.

Online first

I'm calling this whole phenomenon "online first": the biggest brands of tomorrow will be built online. This will be partly because the tools we have available to build brands online are going to get better and better, and partly because money is going to flow to digital from TV. I recently wrote about this in more detail in our Future of TV report:

I am definitely not saying that TV itself is in trouble. We live in an amazing time for TV content. You just have to look at shows like Breaking Bad, Walking Dead, and True Detective to see that we have exceptional content and more ways of accessing that content than ever before—and that's before we even get to Netflix and House of Cards. In part as a result of this resurgence, the total time spent watching video has increased every year recently.

Our devices are also getting better and better. The cost of big screens is coming down; we now have full HD on our mobile devices.

But the way we get our content is changing. 80% of US households have some form of internet-connected device paired with their TV according to gigaom research. Whether it's an Apple TV, Roku, Xbox, Chromecast or something else, we can increasingly watch anything we like on the big screen. And conversely, we can watch more and more of our "classic TV" content on smartphones, tablets, laptops and any other screen we can lay our hands on.

This particular part of the trend has been analysed to death. I'm not interested in that for the purposes of this analysis. I'm interested in the fragmenting viewership: In general, we're no longer all watching the same thing at the same time. That has profound impacts on the way TV advertising is bought and sold.

The innovator's dilemma predicts that the cost per unit of the high end of the old market will continue to rise even as the bottom starts to fall away. It's becoming ever more valuable to reach consumers on those rare occasions when we do all sit down at the same time to watch the same content.

The complexity of time-shifted internet-delivered content rapidly surpasses human optimisation ability. The upfront media market in which Oprah stands on stage and extols her show and the network and seeks tens or hundreds of millions of dollars of spend is a process which can't survive the move to digital-scale complexity (if you're interested in this, I wrote an introduction to TV advertising a few weeks ago).

Advertising against TV-like content will have to be bought more like AdWords. It has to become real-time (depending on who's actually watching at a given moment), it'll have to be market-priced in one form or another (because you can't negotiate all these things individually on the fly).

I'm in danger of getting dragged into deep economic arguments, but the effect of all this disruption is going to be a whole load of unbundling and a reallocation of budgets.

Editor's note: The PDF below is no longer available.

Of course, in part, this will open up opportunities in video marketing—both in brand-funded TV-like content and in video advertising against internet-delivered video (check out the talk by Chris from Wistia's [PDF]). I don't think it's a given that the incumbent TV advertisers will dominate that space. It's structurally pretty different. We are certainly betting in this area—between Phil and Margarita, we're already doing video strategy and execution for ourselves and our clients.

It's not all about video, though.

How our industry competes

There are three broad areas that we all need to get great at to take advantage of this opportunity. Video fits into the first of these, which is technical creativity—that place where technology and storytelling meet:

1. Technical creativity

I've been endlessly frustrated over the years by the creative storytellers who misunderstand (or don't even care about) technology. The stupid apps that no one uses. The branded social networks that nobody joins. The above-the-line campaigns telling you to search for phrases they don't rank for.

Old-school SEOs can spot crawl issues or indexing problems in their sleep. We've had to get good at things like analytics, UX, and conversion. Indeed, one of the most popular talks last week (and Slideshare of the day) was from Aaron Weyenberg at TED, and was all about UX. The things that stood out to me the most were all about the different ways they listened to their audience and gathered feedback at different stages of the process. This incorporated everything from the standard hall-way tests through qualitative and quantitative surveying to a really nicely-executed beta. You can see the full deck here:

The Story of a Redesign

And we mustn't lose sight of the value of that technical knowledge. Screw up a migration and you're just as hosed as you've ever been.

For me personally, the creative is the more challenging part—but luckily it's not all about me. We've been investing in creative for a while, and I loved the presentation our head of creative, Mark Johnstone gave last week entitled how to produce better content ideas. It really clarified my thinking in a few areas—particularly about the effort and research that should go in early in the process in order to give the "lightbulb moment" a chance. By coupling that with examples of deconstructing other people's creative (and showing us / giving us further reading on how to practice ourselves) he made a compelling argument that we can all do this so much better—and that not only designers can be "creative." I'm also looking forward to trying out the immersion techniques he talks about for getting from unstructured to structured. You can check out the full deck here:

How to Produce Better Content Ideas

[If you'd like to see more of the decks from Boston, you can currently get them here and in the next few weeks the videos will be available within DistilledU]

2. Broad promotional ability

The second capability we need after technical creativity is a broad promotional ability. This is your classic owned, earned and paid media.

As search marketers, we've typically focused primarily on the earned side of this—via outreach and digital PR—and my colleague Rob Toledo gave a great presentation about some of the cleverer forms of earned media in his presentation The Hunter/Gatherer. He talked in detail about ways of reaching that tricky kind of influencer—the one who wants to discover their own interesting share-worthy material. It was a funny presentation that contained some exceptional tactics. You can see the full deck here:

The Hunter/Gatherer

I think paid media is going to have an ever-increasing part to play in online brand building though. Pay Per Click is typically measured on direct response metrics—sending traffic to landing pages and converting them—but social and video advertising is on the rise. We increasingly spend money on promoting content instead of promoting landing pages. I expect that trend to continue.

The eagle-eyed among you might have noticed that this isn't inbound. I make no apology for that.

3. Influence and measurement throughout the Customer Lifecycle

Finally, alongside our technical creativity and promotional ability, we need to double down on our ability to influence and measure customer behaviour throughout the customer lifecycle.

We've all heard (or even been) the search experts who stand on stage and talk about the measurability of digital. Sometimes they go further and make off-hand comments about how you "can't measure TV."

Does anyone really believe that? Anyone think Proctor & Gamble or Unilever really waste half the money they spend?

One of the most mind-blowing talks I ever attended was at ad:tech a few years ago—it was a speaker from Ogilvy talking about the econometric models they use to measure their work for P&G. It was all about how they were tying together the influence of point-of-sale, coupon codes, TV, and other above-the-line advertising to understand what's making them the money. They are good at it but it's expensive. Our industry's stuff is cheap in comparison. It's not yet good enough but if we work hard and invest, it can be.

What I didn't say

Remember: I didn't say TV is dead. I didn't say search is dead. I said that our crazy blend of technical creativity, promotional chops and measurement skills is going to be the skillset that builds tomorrow's biggest brands. AND—crucially to the topic near and dear to much of the Moz audience's hearts, it's also going to be how you rank in Google.

Advertising is a half-trillion dollar a year industry struggling to understand its place in a digital world. I don't want the same old guys to win on our turf. The internet is our domain. Let's go get great at this.