By Corey Elliott, Borrell Associates
Now that we have all settled into a new year, most of us have already forgotten about all the predictions that pundits, professionals, professors, and lowly ad research companies made a scant few weeks ago. All of us were more than happy to share our insights, pontificate on possibilities, and predict the future of local marketing in the coming year. And boy, did we all spend a heck of a lot of time on them. I have just one question:
Did anyone check in with the guys who actually BUY the marketing?
Granted, many of the predictions you see floating around at the beginning of the year tend to concentrate on big players: CPGs or other national advertisers. There is usually also a fair amount of prognostication around different marketing technologies. However, these advertising horoscopes need to be rewritten before they can be applied to local SMBs.
If we listen directly to SMBs, they can help us predict a more accurate future.
For instance, things that are all the rage right now and are the subject of many a forecast, have yet to make their way down to a local level. At the end of 2016, we checked in with local advertisers and asked if they expected to engage in either augmented or virtual reality in the coming year. 3% of them said they would.
If you had listened to some tea leaf readers at the time, you might think AR/VR would be employed by half the stores on main street. Well….we checked. And at the end of 2017, 5% of SMBs said they participated. That’s not too far off their own prediction.
Sometimes, technologies we predict will be commonplace change before they even get to the local level. Three years ago, you could not get through a post on predictions without hitting the word “beacon.” 45% of SMBs give beacons less than a 50% chance of driving business in 2018, while another 15% just did not care. And there were more than a few local advertisers who were not familiar with the technology at all.
Obviously, there is hardly any better forecaster of SMB behavior than an SMB. And through regular feedback surveys with our local advertiser panel, we get to see how accurate they truly are when it comes to predicting their own marketing behavior.
At the end of 2016, 15% of SMBs reported they were 100% likely to invest more in developing content than buying advertising and another 48% said they were 75% sure. By the end of 2017, 26% of panelists said they spent more on content than on advertising. Not bad follow through.
SMBs also predicted that in 2017, they would focus on fewer social media platforms. In fact, the average probability they would cull social media turned out to be 71%. By the end of 2017, we found out they kept their word. The average number of social media networks used in 2017 was 3 and 82% of SMBs reported that it was true their business focused more intently on one or two social media platforms than trying to maintain a presence on all platforms.
So…..if these guys are so great at predicting their own behavior (go figure), what do they have in mind for the rest of 2018?
We grabbed 3 of the more popular predictions /questions and asked what SMBs thought of them.
“Advertisers will move away from advertising on cable news networks and during news programming.”
Some panelists think this will happen because viewers have moved online because of the content of TV news no longer providing what the audience wants. However, most local advertisers don’t see this happening. 51% of them see a less than 50% chance of it occurring.
“Video (stories) will become the best daily personal interaction with the staff of businesses and a way to get info / specials / promotions out to customers.”
The panel was split right down the middle on this one – 51% agreed with that prediction and 49% did not. However, some additional information from local advertisers point to an increase in video in 2018.
SMBs already announced they intend to focus on fewer platforms, but what is somewhat surprising is the “new” hot platform so many – YouTube.
Sure, it might be old news for everyone else, but there appears to be a great interest in YouTube at a local level – with 69% of local advertisers who are already using it planning to increase their expenditures in 2018.
Keep in mind, YouTube users on a local level are a much smaller base than Facebook, Twitter, or Instagram, but it would be a safe prediction, based on SMBs themselves, to say YouTube will have the largest percentage jump in usage in 2018.
“There could be a resurgence of use of “traditional” marketing (advertising) in proven, trusted media like radio and television as a foundation for a media mix that includes social and digital, especially since the cost of paying to play on social media continues to rise.”
Sure, that’s a long prediction, but it cuts to whether local advertisers see a place for traditional (read non-digital) advertising in 2018. And…….the panel was split.
Half said they disagreed, and included comments to back up their viewpoint: “I do not think there will be a resurgence. Radio and tv just don’t work as well as they once did because people have too many other options to fill their time.”
But for every naysayer was someone who agreed with the prediction and offered a nearly opposite POV: “With all the bombardment of social and digital, many people now highly value more traditional marketing methods, that are perceived as personal.”
If we include their outlook on newspapers though, we may be able to reasonably assume non-digital media will not disappear. 62% of SMBs think the chances of newspapers becoming obsolete in 2018 is less than 50%.
Of course, there is one prediction straight from local advertisers that nearly everyone reading this would like to be true. They are optimistic about 2018 – and many more of them are expecting to increase their advertising expenditures in 2018.
So, predictions from pundits will always fade away – and new ones will take their place. And only the curious will look back and see if those experts were right. But, if we listen to the local advertisers themselves, the pundits might have a lot of free time on their hands in the beginning of the year.