What Is Digital Marketing and Why Is It Important?

Understanding digital marketing has never been more important. This post details the foundational knowledge needed to launch a competitive, strategic digital marketing strategy.

What isn’t digital marketing?

A normal exchange for me at a party or a family gathering is, “So what is it that you do again? Marketing? So like TV ads? Do you film puppies? Will I see your work during the Super Bowl?”

Here are my answers, in order:

  • I work in digital marketing.
  • Sometimes that includes TV ads, but I call it “Connected TV.’”
  • I wish I filmed puppies!
  • Yes, you’ll likely see my ads at some point during the Super Bowl, but not in the way you are thinking.

The core of the exchange is a common misconception about what is encompassed in modern marketing. Traditional marketing has been immortalized in TV shows like Mad Men, and the Super Bowl has been revered as the pinnacle of marketing execution. But marketing has evolved along with technology. Many companies drive measurable value and increase investment in a different type of marketing—digital marketing.

So, what is digital marketing?

Digital marketing can encompass any efforts that are made via online channels. You probably recognize that you experience digital marketing on streaming services—Hulu ads or Pandora ads, for example.

Digital marketing can also come at you organically and through paid content in less obvious ways. A paid digital marketing experience might be that first search result you see on Google or a sponsored Facebook post or a YouTube influencer. An organic experience could be word-of-mouth on Instagram due to really great content that went viral, or it could be the Google My Business listing that has information about a restaurant you were looking for, along with reviews and directions to get there.

These examples are by no means exhaustive, and good digital marketing isn’t always going to pop out at you. Instead, a good digital marketing campaign may create a seamless and relevant experience for you on your customer journey.

An example customer journey:

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What types of digital marketing exist?

Any experience on the web that would sway a potential customer to experiencing or interacting with your business can be considered digital marketing—website design, search results, Yelp reviews, social media posts, and more are all examples of digital marketing.

We consider three major pillars in digital marketing media: earned, owned, and paid.

  • Earned media use promotions like speaking at events, hosting webinars, reviews, and other manners in which you may drive valuable consumer interest through word of mouth.
  • Owned media puts properties that you own to work for you, like utilizing technical expertise to ensure your site is ranking for organic search listings. Another example of Owned media is using email marketing and organic social media to reach your customer base.
  • Paid media is fairly self-explanatory: channels and methods in which you pay for marketing, like Search Ads, Social Ads, Connected TV, and much more.

A good digital marketing mix should have all of these pillars, and they should act in a Venn diagram, with earned, owned, and paid media intersecting. For example, paid media and organic media can be used together to promote a speaking event, which should then garner word of mouth (earned media) through social shares and reviews.

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How does digital marketing work?

Most businesses have overarching business goals that are aligned to their needs to maintain their growth or stability. Often, these goals can be determined by considering the stage of the business lifecycle. A company in the “start up” stage of their lifecycle may have business goals around awareness and sustainable lead volume growth. Alternatively, a company that is in a “mature” stage could have goals related to efficiency, like profitability.

The way we like to approach digital marketing is by first aligning on business objectives and understanding the Key Performance Indicators (or “KPIs”) that would best drive business success. Then, understanding consumer behavior and audience is key to determining which channels within our three pillars are best suited to strategically drive value for the core objectives. Once goals and channels are determined, digital marketers will work to find the most efficient and effective ways to activate media on those channels.

Important components for digital marketing other than media mix (those channels you have chosen) and objective setting are analytics and optimization. Good digital marketing is successful if you have set up a way to track performance—like tagging conversions and micro conversions on your website and ensuring that all marketing is connected with tracking that ties performance back to campaigns. That enables optimization—which is the cyclical improvement process of launching a campaign—to be able to learn from it, change something (testing), and continue to launch, learn, and improve.

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Then what makes good digital marketing?

In digital marketing, relevance is key.

Google Search, both Paid and Organic, is built on relevance as a key principle. Gone are the days when marketers would have to put an ad out into the world and wonder “are the right people going to see this message?” Search is built off of intent and the desire to get the most relevant information in front of a consumer. If you’re searching for “diapers” and the first result is information about spoons, that would be frustrating, right? But Google knows what you’re searching for and can align that with relevant ads and organic results. So, you can relax: random spoon info is likely not going to happen.

The relevance factor can happen actively in other places. Let’s say you just bailed on buying a new pair of shoes. You really wanted them, but they were too expensive. Then, a week later, you see an ad on Instagram offering you those shoes at a new discount. That’s an example of a highly relevant digital marketing ad.

How do I create (or what assets do I need to create) a successful digital marketing strategy?

Digital marketing can come in all shapes and sizes, and a good digital marketer knows how to select the right suite of capabilities for a business. In a digital marketing strategy session, business objectives and audience considerations are key in deciding how to build a digital marketing campaign.

Measurement and learning are also important, because it’s important to learn what works and what doesn’t. Setting guidelines to measure for success and a culture of experimentation helps companies build opportunities to learn and grow.

Once a healthy foundation is set, marketers can move on to finding the right mix of channels, tactics and creative that will reach their audience. Often, digital assets can be a barrier for some companies, but many strategies like Paid Search and Paid Social have opportunities to build your own assets. Creative assets and collateral should no longer be a barrier for small businesses or busy teams to get digital marketing running.

Why is digital marketing important?

As you can imagine, digital marketing is becoming increasingly important for businesses large and small. The internet is growing rapidly and traditional mediums are shrinking.

Consider changes in TV and video for example. Video streaming users have grown by over 10% from 2019 to 2020 to 1,185.3m, and that number is only looking to grow (Statista). Meanwhile, by 2021, more than a fifth of U.S households will have ‘cut the cord’ for traditional tv subscriptions (Forbes). It has never been more essential for businesses to have a digital marketing partner or team that can bring their advertising to the video streaming space, which is more affordable, more measurable, and more targeted than Linear TV.

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For smaller businesses that may not have the production, desire, or objectives that align with a branding-focused video streaming space, digital marketing still poses an incredibly important opportunity to gain visibility with a target audience. Small and medium businesses can capture a niche audience’s attention in a much more affordable way when paired with highly targeted and relevant advertising, like Search or Social ads. Worldwide, an estimated 2.95 billion people were using social media in 2019 and U.S. users spent almost 2 hours (1 hour and 57 minutes) using social media each day (Statista). Those 2 hours are a great time to build your brand and generate valuable leads.

For any brick and mortar store, digital marketing can still have a very important impact on business. The growth of Google’s local listings has proven to make a huge impact on walk-in traffic and brand engagement, like reviews. Having a strategy for optimizing your local listings can create significant gains for your offline activity.

What is the role of digital marketing within a company?

Digital marketing can complement many business objectives within a company! It’s easy to focus on things like “sales growth” or “lead generation” as an overarching strategy within digital marketing, but digital marketing can also play a role in objectives like customer loyalty, post-purchase experience, and recruitment.

Digital marketing can keep existing users engaged and happy, through things like email marketing, social media, and retargeting; it can help your HR department promote recruitment needs and events via word of mouth and Linkedin Ads; and it can help creative teams get a better understanding of which creative resonates most with a target audience through A/B testing, brand lift tests, and surveys. Digital marketing should be thought of as an opportunity to add value to all business objectives.

Educational resources

There are week-long conferences, training videos, bootcamps, and more that dive deeper into digital marketing, digital customer journeys, and all of the opportunities to grow a digital marketing strategy. We recommend checking out some of the following resources, conferences, and trainings to get started:

Digital marketing FAQs

How do I get started with digital marketing?
Begin by setting goals and expectations based on historical data and business objectives. Take these goals to your marketing team or agency. If you don’t have a team or agency, feel free to reach out to us below.

How do I know if my digital marketing is working?
Analytics and attribution are very important. Ensure that whatever analytics tool your business uses is setup properly and that all digital marketing channels are connected.

Do you need help with a best in class digital marketing strategy, media execution or thought leadership?

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