DMNews recently interviewed Chris Paradysz, CEO, PM Digital, and asked him to elaborate on the some of the key trends he saw for direct marketers in 2010. The original DMNews interview can be found here.
DMNews: Search marketing continues to command the lion’s share of online budgets. How will we see that channel evolve this year?
Chris Paradysz: Consumers have radically improved their search and online sophistication as a result of having less cash but still buying what they need to live, feed and clothe their families, pay their bills, enjoy their passions and manage their health. Search phrases are more targeted because they know more about how to get what they’re looking for.
DMNews: Does that make it more competitive for marketers?
Chris Paradysz: Definitely. Consumers are only willing to pay for the value they perceive and no more. If they don’t like what they’re offered, they click away to a place where they can get it at the price they want. From better targeting at the shopping engines to features like private sale sites, the top retailers are adapting. At the same time the squeeze is on consumers, the search engines have brought enormous changes to their technologies. With the newly released Google Caffeine, for instance, posts from YouTube, Facebook, Twitter and other social media are getting instant, top billing bringing an even more urgent real-time experience to searchers.
DMNews: How should marketers use database technology to improve their business at a strategic level?
Chris Paradysz: A good example is the national and large regional newspaper businesses. These content providers are rallying together to create their own ad networks and will test bypassing Google and other low CPM advertising outlets to create higher value advertising relationships that result in higher ad rates. The only way to deliver this and meet the expectation will be to offer refined demographic targeting of their databases. For their ad clients and agency media buyers to embrace this, advertising performance is all that matters.
DMNews: How can direct marketers implement effective social media strategies in the new year?
Chris Paradysz: This year, and especially holiday, will be the year that social media loses its innocent charm and crosses over into the demand requirements of traditional ROI-based search, display and e-mail campaigns. Social media is not a campaign, and that’s the biggest threat to its purity and ability to drive high-quality traffic for retailers. Particularly for brands with significant recognition, fans are growing at the rate organic search traffic was growing back in 2005. We expect this level of growth to continue through 2010, especially if brands do not compromise the relationships they’ve built with over-zealous marketing.
DMNews: Can you measure social media?
Chris Paradysz: As marketers, we know audience measurement and impact need to be brought into the calculation, but figuring out just how to measure it and what we want to measure will require a different set of analytics. Right now, there’s a bit of a land grab happening for which department owns it so for now, we won’t be able to answer those questions.
DMNews: What is the state of direct mail in 2010?
Chris Paradysz: Segmentation will put the punch back in direct mail economics. No media has the scale and audience reach combined with such targetability. The benefit of it being a legacy media is also helping it survive the privacy turmoil that is brewing on Capitol Hill. Consumers understand its use and the dramatic increase in opt-in/opt-out opportunities has increased the credibility of the source. We already know the mail’s power to drive ecommerce and its ability to so finely target and tune an audience. Ultimately, as is always the case, the economics will drive its future. With the onslaught of new and re-energized businesses in the healthcare industry, for example, there is no replacement of scale for finding this audience.