An article that details everything you need to know regarding what is digital marketing. If you found the Wikipedia or Dictionary.com definition of this term convoluted and confusing, then this article is for you. Digital marketing is the new buzz word and everyone seems to know about it except you. But not to fear, this article is a comprehensive and simple way to understand what this term means.
Digital marketing is a form of marketing over electronic devices such as computers and mobile using the internet.
More specifically, it is known as digital marketing when a user is marketed to using websites, blogs, emails, social networking sites etc. It has expanded its horizon to include devices other than the desktop with mobile phones, tablets and apps. The term Digital marketing is the same as ‘internet marketing’ or ‘online marketing’.
A brief history of Digital Marketing
Digital marketing has existed since the internet, however, it has truly evolved since the early 2000 when it became significantly easier to run online ads, track the performance of ads and improved relevance of the ads which users see.
The cost-effectiveness of digital marketing has also been consistently improving over the years as new tools and better features are rolled out in online advertising products (such as Google Adwords and Facebook ads). Here is a very brief timeline on the evolution of digital marketing so far:
- The earliest forms of digital marketing was when companies used to put ad banners on the side-bars of popular websites where a lot of visitors visited (example:Yahoo.com). Although effective back then, they did not have a great way to track the sales generated from this particular banner (especially if they bought banners on multiple websites).
- Email marketing was another way that many digital marketers used in the early days of the internet. But it was not that easy to scale this marketing due to manual nature of sending individual emails to customers and it did not get popular until effective mass email service technology was introduced in 2000.
- After launch of Google in 1998, being found on the search engine results was another way to drive business. This was again not pursued by businesses pro-actively and it took a couple of years before businesses realized the true value of being able to show up in the first page of Google.
- In October 2000, Google formally introduced Google Adwords, their pay-per-click service that businesses can use to advertise themselves on the Google search engine.
- Search engine optimization continued to evolve as Google got smarter and more intuitive about what results are the most relevant to its users and thus the businesses started investing in improving their rankings on Google.
- In November 2005, Google Analytics introduced a convenient and powerful way to track sales from ad banners, performance of your website on the search engine, track sources of your traffic as well as study user behavior on a website. Subsequently, there were other tracking tools such as Omniture that debuted in the market to provide web analytics. Although, Google Analytics remains the most awesome platform for web analytics by far.
- By early 2011, the availability of social networking sites such as Facebook, Instagram etc. where users have thronged to stay connected with their friends has opened up new ways for businesses to advertise themselves.
- In 2014, the explosion of smartphones and the subsequent internet penetration boosted mobile usage which resulted in many businesses pivoting to an Mobile App marketing model, by encouraging users to install their app.
To be honest I am not greatly satisfied with how I have displayed the above timeline, because it is my opinion that each of these points had their own detailed evolution story over the last 15-20 years. Email marketing for example, has a surprisingly long and interesting history to look back at and then there is Pay-per-click (PPC), which has become the most conventional digital marketing tool which evolved by leaps and bounds. PPC has drastically improved user experience as well as value delivered to the advertiser. Also, cannot be mentioned in small detail is the growth of web analytics – everything that a user does can now be measured by digital marketers.
Hopefully, this timeline still gives you a good sense of how much in-depth and rapidly this amazing technology evolved – and it’s so much older than you thought!
Traditional Marketing vs. Digital Marketing
Traditional marketing involves television advertisements, buying newspaper/magazine ads, billboards, distributing flyers and holding press release events. Businesses around the world have traditionally been spending a lot of money with these traditional activities to grow themselves. And for a long period, they have been very effective.
However with the advent of the internet age, your customers are no longer available as much as they used to in the traditional channels. For example, many newspaper publications such as a Fairfax Media (publisher of The Age and The Sydney Herald) recorded a $893 Mn loss this year. This is due to decline in subscribers, drop in ad prices and loss of circulation.
The reason for this decline is that companies are now investing a larger portion of their budget, in excess of 20% in digital platforms such as Google Adwords, Facebook advertisements and so on. This has greatly reduced the demand for traditional media platforms and considering the huge overheads they bear, it has become a staggeringly difficult growth path for them.
- One of the primary advantages of digital marketing is that you reach consumers on their personal devices such as mobile phones, desktops and tablets. These are accessories where a regular person has spending a lot of their time on and regularly checks throughout the day. Unlike a newspaper or television where the user is available at sporadic instances.
- Secondly, the relevance of online ads is much more than a Television ad or Radio ad. Assume you’re a candy company, wouldn’t it be great if you could just target your advertisement to children and not to the adults? With digital marketing this is possible! You will not waste your advertising budget on reaching people who are not your final consumers (which typically happens when you advertise on television, newspaper etc.)
- Thirdly, with digital marketing you can accurately verify the number of people who saw your ad, reacted to it and to a great extent what was the ROI generated from the budget invested – a huge problem when it came to traditional media. This is possible due to the amazing web analytics technology.
- Finally, the low barrier of entry offered by digital marketing means that businesses of all sizes can now pursue to promote themselves in front of the customer – a game changer for everyone.
Here is a more detailed posts detailing the advantages of digital marketing.
Components of Digital Marketing
To learn digital marketing, there are different components that you need to understand well. For the purpose of this blog, I consider splitting digital marketing into the following components:
- Paid marketing (Pay per click – PPC)
- Content marketing
- Social media marketing (SMM)
- Search engine optimization (SEO)
- Email Marketing
- Web analytics
PPC: This is your paid advertisements that show up on Search engines in the form of Google ads. There are also options to show banner ads on different websites by either purchasing it directly from the website or many websites run banner ads via Google as well (you can see some Google banners ads on this blog for reference). It also includes Facebook ads, Instagram ads and any online ad that runs on the technology of an advertiser paying for each click their ad generates from a user.
Content Marketing: This is the form of marketing where you try to pull customers by writing informative articles. For example, if you are a Gardener, then you can write articles about maintaining a garden and techniques on growing different flowers. Hosting valuable content like this will drive users from Google who are looking for gardening related content. When they absorb this content from your website and see you know what you’re talking about, it results in customers. By providing them valuable information in the form of content, it is possible to build a business. It is one of the most effective forms of digital marketing. This includes creating viral content that can be consumed and shared over the internet.
Social media marketing: This is the art of getting fans and followers on your social media account. It is important to note that social media marketing has two types in the form of paid and free. Paid is in the form of Facebook ads or Twitter ads (and falls under PPC) and free is when you do not use ads but simply try to grow your Facebook fans using without using ads.
Search engine optimization: This is the form of marketing to generate traffic to your website from Google searches, but it requires a certain bit of content optimization to try and get your website to rank in the first page of Google. It is even more challenging when your competitors are also investing in search engine optimization to rank their page higher than yours. This art of one-upping your competition in the search results for keywords useful to you and ensuring you are ranking high for search results is called search engine optimization. It is said that Google uses over 100 algorithms in deciding how to rank a page for a search. As a digital marketer, you definitely want to nail this one.
Email marketing: Email marketing is the component in digital marketing where you generate sales by sending out product emails to your subscribers. This is often used to drive repeat purchases as well as to inform current customers about new offers and promotions on your website. It can also be used for non-sales purposes such as informing a new feature introduction or service introduction to update your customers.
Web analytics: This is the final piece of the digital marketing components. All the above components are incomplete without web analytics. For example, how do you know if your email marketing is doing well? How is it possible to know if your traffic is increasing from Google search engines? To measure these numbers you need to deep dive into web analytics. Web analytics not only help you measure, but they also help you fix problems (i.e. optimize). If there are a lot of users coming to your website and yet, you are not recording a sale, then web analytics can help you figure out where your users are dropping off. For this reason, the importance of web analytics is high and cannot be neglected.
I certainly hope that this article helped you understand the basic meaning of what is digital marketing and also expanded your views on it. You also have the option to access digital marketing books to learn. If there are any ways that I can improve this article to help you understand better, please let me know in the comments. Do feel free to ask any doubts that you may have.