Mark Ballard
VP, Research, Merkle

Social media advertising has been the vanguard of growth for firms and brands that are looking to grow their presence online. Pushing past the initial rush of vanity metrics, firms are now seeking more from their paid social media engagements. We spoke to Mark Ballard, VP, Research, Merkle, to understand how the social media advertising landscape is evolving.

Tell us about your role at Merkle and the team/technology you handle.

As Vice President of Research at Merkle, I oversee our efforts to better understand trends in the digital marketing space using our own first-party data. This includes producing the Merkle Digital Marketing Report, which we publish on a quarterly basis.

How did you identify your key metrics to be included in the Digital Marketing Report?

In the Merkle Digital Marketing Report, we aim to provide reliable benchmarks based on robust data. We cover familiar high-level metrics in each report to provide a consistent framework from one edition to the next, but we also try to offer unique analyses and data that provides context to major developments in our industry.

What are the major roadblocks for businesses in fully leveraging their organic search and social budgets?

We see the primary issue for brands trying to leverage the value of organic search and social budgets is that they still aren’t as connected to their media teams, in the best way possible. The organic teams may sit under the same leader, but they don’t tend to use the same metrics for success, they don’t have true measurement on cross-channel influence to paid media and most importantly they are still seen as a sunken internal cost to marketing vs an external media cost that can be turned up or down at a moment’s notice depending on performance and return.

Is Google advertising losing its shine to social media platforms?

While social media ad spending is growing faster than Google search investment, Google is still the largest single digital platform for most of the brands we work with and continues to produce strong results. It’s also not a zero-sum game between social and search. The entire digital pie is growing and to the extent that social media is drawing investment away from other marketing efforts, it is often from more traditional channels.

Where is Snapchat in this battle for supremacy among social media advertisers?

Snapchat is still lagging well behind the other social media platforms for advertisers. They are struggling to show growth in both revenue and in product value and when utilized in a media plan they are seen more as a flashy item than a performance item.  As long as performance is a secondary thing in the value of the platform they will continue to lag the other competitors.

What role do Influencers play in breaking the ceiling for User-generated content on social platforms? Did you consider the role of influencers in the report?

Merkle takes an audience-centric approach to marketing communications strategy. So, we view influencers as a way to reach and engage audiences in an authentic way. They not only lend credibility to brands but often also act as a creative resource as they are often able to produce high-quality content or content that is in line with the culture that they represent.

They can be leveraged to make brands more relatable, drive consumers to action, create authentic conversation, or just amplify against a target audience. In our opinion, influencer opportunities have grown beyond just amplifying content or encouraging user-generated content (narrow, tactical objectives,) to offering brands an opportunity to co-create content and experiences.

For this report, we did not directly assess the role of influencers in helping shape the digital trends we see.

What are the challenges to modern-day mobile advertising? Why do brands have to reconsider about their mobile ad-tech budgets?

One of the biggest challenges brands face with mobile advertising remains fully understanding the value that mobile ads produce so that they can more effectively allocate their ad dollars. This includes understanding not only online activity and orders, but cross-device conversions and, often most importantly, offline consumer activity. Google provides some insight into metrics like store visits, but some brands find it worthwhile to invest in other offline measurement solutions.

How does AI fit into modern advertising and video content technology offering? What are your major differentiators in the tech-heavy programmatic ecosystem?

AI is now a necessary component of any good modern advertising program. That can range from where to place your money all the way to what is the design of the creative that will work best when you do buy an ad and put it in front of someone. The value of AI is in a system taking away the things that you don’t need to be creative with like data analysis, message efficacy and image placement and allowing your smart people to then focus on developing new approaches to testing new concepts instead of optimization.

We feel like our differentiator in the programmatic ecosystem is that we are a data first/people first organization.  We have more than 233M individual level identities of the people in the US that have more than 1,000 attributes on each of them.  We know how to plan an experience for someone from the first point of contact with our client’s brand through a lifetime of engagement. And finally, we know the points where we can influence a customer on their journey and the ones where we can’t, based on our data, technology, strategy and media execution processes.

In Amazon versus Walmart battle, which group has the better chance of delivering on their Customer Experience promises? How could we measure that performance?

We believe Amazon will win the online customer experience battle, but we are watching Walmart’s offline presence. Amazon wins by fulfilling promises. They keep poor sellers on a short leash if they are unable to fulfill in a timely manner, or have poor customer reviews and experiences. Walmart’s diligence in this area is still playing catchup comparatively. For luxury brands, Walmart may have a leg up on Amazon in counterfeit merchandise, due to Walmart’s seller and item qualification process. We believe Walmart’s ability to deliver value in online-to-offline via store pickup has the opportunity to cut into a share of Amazon’s anticipated growth in same-day delivery and grocery. Walmart’s footprint, selection and price points compared to Whole Foods is worth watching in 2019. Both companies are making big bets to win customers to their ecosystem through physical footprint, price and speed of delivery / frictionless experience.

What are your predictions on the future of Comparison Shopping Engines? Would they make a difference to the adtech budget in 2018?

Traditional US Comparison Shopping Engines have been in decline for some time, and are likely to continue to shrink, as they have limited traction on mobile devices and given shoppers’ growing tendency to use Amazon and Google Shopping for product research.

Thanks for chatting with us, Mark.

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