Can it adapt as the online advertising industry transforms under the pressure of huge trends such as mobile-first, programmatic media buying/selling and native advertising? In five years’ time, will you still have a business?
In our first Blue Ribbon Panel Round Table, we brought together industry luminaries such as Erin Cigich of Clickbooth, Melissa Feemster of Rakuten Affiliate Network, Jason Durant Walker of W4, Daryl Colwell of Matomy Media Group, Cristian Miculi of Avangate and Matt Frary of SmarterChaos.
The conversation covered a lot of ground including the explosion of mobile and native advertising, programmatic affiliate marketing as a key to growth, and the need for multiple attribution capabilities. These are the folks that are really thinking about the future of performance marketing. Read on to see what our panel members have to say on this critically important subject.
Erin Cigich, CEO of Clickbooth began the conversation, “In five years’ time performance marketing as a whole will be bigger in both the USA and internationally than it is now. Performance is the great equalizer and it is an advertising model that simply makes sense. Historically, performance marketing has been the engine that powers the growth of every advertising medium. Whether it was email a few years ago or is native advertising today, every big advertising trend has begun with and is ultimately powered by performance marketing.”
Melissa Feemster, GM of Rakuten Affiliate Network was also very optimistic, “I am positive that growth and significant change await us in 2016 and beyond. Networks play the role of setting their partners up for success in new ways, whether they be advertisers or publishers. We create the platform for innovation where more money can be generated, and new business models can be created. To take my own network as an example, we see innovation – whether it is commissioning or tools or reporting – as a fundamental part of making our publishers and advertisers more profitable. Put it all together and there is only growth ahead.”
From rapidly growing European network Avangate, Cristian Miculi said, “As the entire online acquisition channel develops, the performance marketing side will grow at least at the same pace – if not even faster – due to its focus on ROI and measurability. Both CPS and CPA will be around; CPS will become the standard for the ultimate conversion goals and will be based on the data gathered from the customer journey – multiple attribution may become mainstream in five years’ time.”
Daryl Colwell of Matomy Media Group picked up on the ways in which the industry is already evolving to incorporate a changed environment, “It is tough to predict but what I can say for sure is that mobile will be a key growth factor. Consumers of all ages are increasingly becoming more comfortable buying low & high ticket items via their mobile devices. As screens and devices get larger & easier to use, even more purchases will be happening on mobile.”
Erin Cigich continued on into an area that we at mThink believe will be very important for the future of the industry, “The key driver for this growth has to be tied to a programmatic approach. Today too much scale is limited by manual processes in our industry. Creating the platform that can use big data and apply it to performance decisioning – that’s the game changer.”
We will be revisiting this particular subject area in the future. What about the CPA side of the business in particular? Isn’t that already saturated?
Matt Frary, the founder of SmarterChaos, doesn’t think so, “I believe that the CPA model will dominate over time as we are seeing more and more companies taking their CPM, CPC, CPI, or any other media buying model and backing it into an effective CPA (eCPA). Publishers want to move away from CPA, but advertisers want to move towards it. The most interesting thing to watch moving forward will be to see who wins out.”
Jason Durant Walker, co-founder of W4 said, “There was a temporary contraction in the CPA space as low-value direct response marketers and dubious publishers were driven from the space. But that left a cadre of professional and sophisticated CPA practitioners still standing, and they’ve succeeded in building CPA revenue back up by delivering real value to consumers and advertisers. As the numerous CPA advertisers who have been successful grow, they invest more in CPA. And on the supply side, we see continued expansion of performance-based media channels (as evidenced by the recent explosive growth of mobile and native ads) — and smart and innovative affiliates are leading the way in monetizing these new channels.
We also believe that CPA’s results-based model makes logical business sense for advertisers. The fact that it helps minimize risk and guarantee ROI will continue to attract more of them into the space. Plus, mounting evidence of the pervasiveness of click fraud and bot traffic in non-performance-based online media is making CPA even more attractive.”
Cristian Miculi also believes that, “CPA will continue to be preferred for certain verticals among which the most interesting may be B2B. The transition from offline to online B2B customer acquisition could drive much-increased demand for lead generation publishers.”
Daryl Colwell also has a very positive outlook for CPA and new opportunities for growth, “As consumers are spending more time on devices, the CPA side is seeing increases in inbound call activity. So it’s not enough to simply present a consumer with an opportunity to complete a lead gen form. If a marketer wants to ensure they are capturing an interested prospect, they must present them with the opportunity to dial in.”
So what’s the bottom line for our Panel? Every single participant was excited and positive about the future. Of course, there are challenges ahead as new technologies and advertising platforms emerge, but every obstacle is also an opportunity. He/she who dares, wins.