The Future Of Social Advertising: The Definitive Guide (Part I)
“Most of your innovation is hiding in plain sight, you are institutionally blinded by your legacy systems and culture.”
― K. Melissa Kennedy, T
In 1806 Prussia entered into a coalition of nations aimed at defeating Napoleon and stopping French expansion.
Prussian generals were seasoned veterans. They were eager to battle Napoleon. They were confident their decades of experience would ensure victory over the 37 year old Emperor they saw as immature and lucky.
On October 14th, 1806 Prussian and French troops finally faced one other.
The two armies were evenly matched in numbers. They had more or less the same technology. However, in what became known as the Battle of Jena, the Prussians were annihilated.
Napoleon’s approach, what he did with what he had, made all the difference.
Napoleon’s troops were fast, carrying their own supplies where the Prussians traveled with slow moving wagons to hold their provisions.
In battle the French moved swiftly, adapting to their surroundings, firing behind walls and buildings. The Prussians moved in stiff formations, fighting out in the open, making them easy targets for the French marksmen.
The Prussian generals, many of them nearly twice Napoleon’s age, assumed their experience would be an asset.
Instead, they were caught fighting in a style that no longer made sense for the times. Napoleon didn’t fight by the old rules of warfare.
As Carl von Clausewitz wrote:
“it was not just a case of a style that had outlived its usefulness but the most extreme poverty of the imagination to which routine has ever led.” In the end the Prussian army “was ruined more completely than any army has ever been ruined on the battlefield.”
– On War
The Prussians did what they’d always done. This is what led to their downfall.
Each field has its tectonic shifts that leave only the resourceful few standing. From Marketing to War, principles for victory are the same.
In marketing you are at war for attention.
Fighting for mindshare against competitors. Battling for ad space, vying for the right endorsements, the best talent, and best ideas.
The rise of DTC has shown us that emerging brands can disrupt established players despite having fewer resources.
Experience can be helpful, but if it becomes dogma it is a liability.
In other words, don’t act like the Prussian Generals. Adapt. Use the technologies available to you. Brands thrive or die by how much they adapt to the times.
What worked in the past has no bearing on what will work today. Kodak fell into irrelevance by not focusing enough on the digital camera – a technology they themselves invented.
In 1975, a Kodak engineer, Steve Sasson, created the first digital camera.
On the opposite end of the spectrum you can see how the moves Procter & Gamble made in the 1930’s led to its dominance today. The company grew to be a conglomerate by adopting (and investing heavily) in radio advertising during the great depression. While others were cutting their advertising costs, P&G invested in first-of-its-kind radio content.
In 1933 P&G launched the first soap opera. The groundbreaking radio series “Oxydol’s Own Ma Perkins,” became an instant hit.
The next decade, with its own rapid pace of change and unpredictability, will be a defining moment for today’s brands. It will be a litmus test of adaptability and willingness to focus on what’s true and what works vs habits and long established processes.
A change of perspective will be essential.
However, you don’t have to look too far ahead. There’s a hidden revolution happening right under our noses. The next big thing is already here.
I’ll outline those emerging opportunities in detail.
But first, some context…
Screen time is up.
One of the core human needs is the need for intimacy and connection. We’ve all felt this during the COVID crisis. We’ve relied on our screens more than ever. But the pandemic has only accelerated a trend that was well on its way.
Teens average 7 hours of screen time a day and tweens average 4.5 hours.
The next decade will be marked by a need for more intimate connection, due to interpersonal separation and an increase in our screen time.
The numbers say it all. The average american office worker spends an average of 11 hours a day looking at a screen. Teens average nearly 7 hours.
In person interaction is way down.
Even before Covid this was a massive issue.
Today’s teens spend an hour less per day with one another than their Gen-X counterparts. Three out of five adults report sometimes or always feeling alone.
Three out of five adults report sometimes or always feeling alone.
Robert Putnam, author of ‘Bowling Alone’ wrote that, “we have become increasingly disconnected from one another and how social structures—whether they be PTA, church, or political parties.”
China is leading the way.
When it comes to mobile app technology China has become a leading indicator for the US.
China has gone from copycat to leading innovator in record time.
According to a Price Waterhouse Cooper report
“where Chinese businesses were once derided as copycat innovators, the leading digital players have now developed into world-class trendsetters at the intersection of eCommerce, mobile and social technologies…. China’s internet players will increasingly become more established on the global landscape.”
-The rise of China Silicon Dragon
One only needs to look at the popularity of TikTok as evidence of China’s leading technology influencing the US.
Douyin, the Chinese version of TikTok has more than 600 million daily active users. Nearly half of China’s total population is using TikTok every day. Here in the US it has an estimated 100 million monthly active users. This is more US Monthly Active Users (MAU’s) than Twitter.
TikTok’s expansion is a micro example of a macro trend.
League Of Legends and Fortnight, two of the most popular games in the US are Chinese owned. China is pioneering mobile payments and digital currency.
By understanding our current digital landscape and what is occurring in China, you can extrapolate out what is likely to change here in the US in the years to come.
So… What’s in Store for Social Advertising?
What does the future of advertising look like in practical terms?
Given the research and existing trends we’ve seen so far, I’m confident that what I’ve outlined is going to be the most disruptive (and effective) changes to advertising.
I present to you the the first, of three shifts, I believe will define advertising in the near future.
Prediction #1: The Rise Of Dark Social
Dark Social is digital content shared via private channels. For example emails, SMS, text, Discord, Slack, and even private Facebook Groups are all considered to be Dark Social.
These are the places where we share with our friends and our close knit communities.
A RadiumOne study, found that “Dark Social” accounts for over 80% of all shares globally. For comparison only 7.5% of all shares online happen via Facebook.
The benefits of Dark Social for brands are multifaceted.
The tools are generally inexpensive. For most platforms there are fees to license the technology, and then free to send the messages. Meanwhile brands have to pay more and more to reach their fans on social, as organic reach continues declining.
Today a brand is lucky if they reach even 1 percent of their target audience on a typical Facebook post. Contrast this with text message services where open rates go as high as 98%. Even owned channels like email have open rates where a ‘good’ open rate tends to be 20-30%.
From a psychological standpoint, dark social allows for a stronger relationship with consumers.
Because these are private channels, people aren’t as worried about being judged for making stupid comments, which means you can address their individual needs. There’s a greater sense of intimacy – text messaging in particular is a platform left for one’s personal relationships.
Here in the US there are a number of startups emerging within the Dark Social space.
Q3 2020 Apps by U.S. Downloads
Discord, a consumer focused messaging platform similar to Slack, raised $100 million dollars. The platform which originally catered to the gaming community has seen incredible growth. Within four years from launch, Discord reached over 250 million users with over 850 million messages exchanged daily.
Additionally, you’ve probably seen a lot of celebrities and influencers sharing their phone numbers in public.
Most of these are from Community, a startup that Ashton Kutcher and Guy Oseary invested in. Most recently Obama even joined the platform.
Community allows users to reach audiences at scale all at once, individually, or segment them based on age location, gender etc. Think Mailchimp for SMS.
Musicians are using the platform to drive ticket sales in cities. A lot of influencers are using it to drop exclusive merchandise.
Celebrities and influencers often use Community for ‘surprise & delight’ moments with fans. It’s not uncommon for them to send individual posts and answer questions.
For example, the DJ Marshmello regularly responds to people asking if it’s ‘really him’ by writing their names and a message on a whiteboard then texting them a photo of it.
These activations turn fans into super fans.
Who wouldn’t want to text with their favorite celebrity or influencer?
Brands are seeing success with these platforms as well. For example, the skincare brand PeaceOut Wrinkles recently adopted SMS as a sales channel to reach existing customers.
The results were outstanding, and within their first month SMS accounted for 21% of their total e-commerce revenue as well as:
- Generating a 780% ROI
- Became their second largest sales driver
- Revenue per SMS subscriber was 52 times higher than email
While the US is dipping its toes into Dark Social, in China it is an integral part of life.
There the entire e-commerce, entertainment, and social ecosystem exists within WeChat. As a result this one to one communication and dark social selling is much more ubiquitous (and advanced).
Analyst Ben Thompson described WeChat best in his blog, stating that:
“For all intents and purposes WeChat is your phone, and to a far greater extent in China than anywhere else, your phone is everything,There is nothing in any other country that is comparable: not LINE, not WhatsApp, not Facebook.”
-Stratechery
Within China many brands have their public facing social presence, in the same way brands have a Facebook and Twitter page here.
Additionally, many implement social CRM efforts on WeChat. As I outlined in an earlier article on China,
“Generally speaking they focus on communicating with VIP customers directly. Common tactics implemented were providing early previews of products, addressing personalized inquiries, and having sales associates develop more personal relationships with customers.”
– Campaign Live
This form of ‘social selling’ has become ubiquitous in China, while in the USA it’s still an outlier tactic. But, why shouldn’t it be ubiquitous here?
For brands, there’s virtually no reason not to try Dark Social.
Social platforms own their audiences, not the pages with the followers. Organic reach continues to decline.
At the same time we’re seeing audiences embrace dark social as a way to cultivate a stronger sense of community.
Adopting dark Dark Social is an investment in long term success.
This is the opportunity for brands to step in. To invest in relationship building. The brands that embrace this first will gain a major advantage long-term. With such an incredibly low entry cost and high ROI it’s a phenomenal way to future proof your business.
This is part one of a three part series. Sign up for my newsletter below to get the latest updates.
