The State of Digital Advertising in eCommerce and How Your Business Can Benefit

By Grace Frenson July 31, 2020

I am proud to welcome Grace Frenson to talk about the state of digital advertising in eCommerce industry.

Grace welcome!

Now that we have reached the turn of the decade, it is important to focus on the current state of digital advertising as it relates to eCommerce in 2020 and beyond.

The year 2020 came in with a twist that no one saw coming. The state of business and the world itself changed to accommodate the circumstances.

The state of affairs brought about by an international lockdown had a chilling effect on the economy, and the hit that the retail commerce brick-and-mortar sector in a way that we have not seen in the past.

The ordeal was able to create an even more substantial increase in online shopping.

In other words, when the world’s physical retail locations were closed down, it forced more people to pursue online shopping options.

The current state of global affairs, as we imagine the aftermath and long-term impact of the pandemic, tells us that eCommerce is the wave of the present and future.

Understanding this fact has prompted the evaluation of the state of digital advertising for eCommerce companies today and moving forward.

This report highlights the results of this objective evaluation.

Traditional Advertising

We would be remiss if we failed to properly outline the scope of traditional advertising.

While the advertising landscape has changed a great deal over recent decades, the traditional forms of advertising need to be identified in order to draw the contrast between digital and traditional advertising.

Traditional advertising outlets include the following:

a. Newspaper: From small classified ads to circulars, newspaper advertising has traditionally been a staple in advertising circles.

Before the advent of the internet, newspaper advertising was the most widely used form of advertising in local markets.

Pew Research Center reported 28 consecutive years of newspaper circulation decline back in 2016—when the market fell by 8%. 

b. Magazine: Magazine advertising has worked in the same fashion as newspaper advertising; however, magazines get national circulation.

The content that magazines provide is still just as in demand as ever.

On the other hand, in 2018, advertisers spent 12% less on magazine advertising due to the consistent annual decline in circulation.

c. Radio: Radio advertising has followed the same downtrend as radio listenership.

Radio spots are still used by local businesses, but the decline in listeners has led to a decline in radio advertising.

A study shows that the decline is based on a change in format, repetitive playlist, lack of ability to find desirable content, and the increase in streaming services.

d. Television: In traditional advertising, television is clearly the most expensive and effective form of marketing.

The success of the television commercial has been based on the fact that television viewership has been so widespread over the years.

Results from a study conducted by the Manga Global research firm showed that the 4% decrease in global TV ad sales in 2019 was steeper than it had been since the Great Recession.

What is Digital Advertising?

Digital advertising refers to advertising done online.

It is reported that an estimated 64% of people surveyed claim that they made a purchase after being influenced by watching a video online.

Facebook alone can be linked to 52% of purchasing decisions.

The impact of the internet on our daily lives makes the internet the most viral media outlet in history.

So much of our world revolves around the internet, that if the internet ceased to exist, the world would face a global crisis that would cripple the global economy and bring everything to a screeching halt. This speaks to the unbridled power of the internet today.

Digital advertising is the process that consists of brands and online marketers promoting their products and services using content published online through various platforms like search engines, social media, websites, etc.

With the target audience for all sectors, spending a bulk of their time online, the web has created the perfect environment for eCommerce marketing.

The various types of digital advertising outlets and formats include:

a. Search Engine: Advertising on search engines like Google and Bing, is based on keyword searches.

The two types of search engine marketing types are pay-per-click (PPC) and search engine optimization (SEO).

While there are thousands of results populated when a search is conducted, 90% of searches end on the first page.

b. Display Ads: These ads are the most fundamental form of digital advertising.

These ads are composed of text and images. Display formats include banners, popups, landing pages, or flash-generated ads.

Display ads are found on websites with a majority being found on blogs.

c. Native Ads: These ads are similar to display ads, with the exception of being more strategic in nature.

Rather than being randomly posted like display ads, native ads are integrated into the site’s content feed.

These ads are aimed at a specific target audience.

d. Social Media: The dynamic impact that social media has had on the world is undeniable.

While social media is still fairly new compared to the internet as a whole, these platforms are the biggest outlet for digital advertising.

The two types of social media advertising include paid or sponsored posts and organic ads—also known as influencer marketing. Social media ads can be display, native, or video ads.

e. Video Ads: Video advertising has become the most effective form of digital advertising in recent years.

These videos are typically designed to promote products and services in a way that resembles the traditional TV commercial. Social media platforms are the predominant outlet for video ads.

In 2020, 86% of businesses use video advertising as a marketing strategy.

f. Email Marketing: This form of advertising is based on sending emails to those that have opted into a company’s email list.

Promoting to those that have not opted in is considered spam and is prohibited.

Email marketing is effective because prospects are interested in the brand’s initial content; thus, making them strong leads.

Sending informative email newsletters with periodic special offers is the preferred method used by successful marketers.

Photo: Facebook
Photo: Google

Traditional vs. Digital Advertising

The signs are clear that the world has made up its mind about traditional forms of media and entertainment.

The general public has decided that it will take the job of curating and programming the content they consume into their own hands.

The rapid and drastic declines that we have seen, in not only traditional advertising, but the overall viewership, listenership, and readership of the traditional outlets as a whole, paint a clear picture of the state of advertising in the modern era.

Instead of reading the morning paper, everyone gets the news in real-time right from their mobile device.

Rather than sit and watch the television programming provided by TV stations, people would rather decide what they want to watch and when by streaming their shows and other video content online.

Similarly, instead of listening to the same playlist from the local radio station, people now create their own playlists.

The world has definitely turned a corner, and it is plain to see that we are not going back to the days of old.

If you do not adapt to the current state of media and marketing, you will only be making an opening for your competitors to swoop down and snatch up your share of the market.

Digital advertising is not a one-and-done process; however, it takes testing and trial and error to create optimized content.

This is also why as many as 70% of digital marketing campaigns are unsuccessful.

Like all marketing campaigns, digital advertising campaigns must be monitored and cultivated for maximum effectiveness.

The Major Players

When advertising online first began, it was every man for himself—much like the Wild West.

That was a time when everyone was just trying to understand and navigate within the new space.

All digital marketing dollars spent during this time were done so experimentally and at great risk.

Fortunately, the internet is far more mature in 2020. The winning advertising outlets host billions of prospects, and there is very little guesswork needed to figure out the best ways to direct your marketing capital. 

Currently, 60% of all digital advertising dollars are spent with Google, Facebook, and Amazon. Not to mention YouTube and Twitter, which are also dominant in this space.

When you are looking to invest in a digital advertising strategy for your site, these are the best places to find your target audience.

Your Digital Advertising Strategy

Now that you have an understanding of the current state of affairs in regards to digital advertising and eCommerce, this information can be utilized to create a digital advertising campaign strategy for your website.

Now that you have an overview of the digital advertising methods and dominant outlets, you can better ascertain what processes will benefit your site in the immediate future and in the long-term.

Can you describe what:

  • your target consumer is like demographically?
  • interests might your target customer have?
  • social media platforms would your prospects frequent?
  • type of content might your target consumer like to consume?

These are just a few of the questions you need to answer before structuring your digital advertising campaign.

Advertising is all about knowing your potential customer and finding out how to reach them with a message and offer that they can appreciate.

With digital advertising, you are able to find your prospects on high-traffic websites that will host your ad content and present it directly to your target audience.

Always test various ads, and pay attention to all analytics provided by the platforms posting your ads.

Conclusion

There is no doubt about the fact that the world is connected via the internet in a way that has altered the way humans communicate and live our lives.

This reality has made traditional advertising outlets that have been used exclusively for generations, all but obsolete in comparison to that of digital advertising.

If your company has not fully taken advantage of the various forms of digital advertising available today, consider the market share you are not tapping into.

What ways can your business better implement digital advertising with your marketing strategy?

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Grace Frenson

Grace is a freelance writer from Philadelphia. She recently graduated from Drexel University with a Bachelor's Degree in Business Administration. While studying for her degree, she interned under a notable marketing consultant in King of Prussia. PA.

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