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Digital Advantage: Include digital in your marketing budget

By Jason Holmes
Dec. 11, 2013 at 6:11 a.m.

If you are like most companies that operate on a calendar year budget, you are probably finalizing things for 2014.

If that is the case, I hope you did not leave digital out of your advertising and marketing budget. If you did, you may want to rethink things and reopen that category.

National and local budgets are increasing and shifting to make room for digital advertising and marketing initiatives.

Local businesses are finding value and reaching new customers by advertising on local websites, national sites targeted to the region through technology hardly dreamed of five years ago and social media sites such as Facebook and Twitter.

A big shift locally is that our clients are finding broadcast alternatives like YouTube and Pandora to be very effective in positioning their brands as premium players alongside major big box stores.

When a local consumer hears an advertiser on Pandora or sees a pre-roll video ad on YouTube, it's noticed because there are relatively so few ad spots, and most of the inventory is snatched up by national chains.

As you think about making room for digital advertising in your budget, you are probably wondering where your particular industry spends the most and what the local picture looks like.

These are questions we try to answer for customers every day. To do this, we rely on objective data from several sources. However, the primary source we use is Borrell Associate's Compass Data. It's a subscription service that allows us to benchmark what is being spent by industry and media type in the markets we serve.

Online advertising already accounts for 30 percent of all advertising dollars spent in Victoria, according to the data. More stunning is that by 2018, online advertising is expected to make up just more than 50 percent of all advertising dollars.

How do these digital advertising dollars break down? Digging through that data is always interesting. The picture can vary wildly by industry, as can the allocation of the funds. For all industries combined in the Victoria market, the biggest categories are targeted display advertising at 32 percent (those ads that follow you based on things you've searched or shopped for), paid search at 27 percent (text ads on Google, Yahoo and Bing) and online video at just more than 17 percent. The remainder is spread over all other digital advertising channels.

Small- or medium-sized businesses need to have some kind of a plan for these three categories in order to compete in 2014. Including funding in your marketing budget for digital advertising is essential.

Interestingly, targeted display advertising is projected to grow 10-fold over the next five years in the Victoria market. Much of this is driven by the cultural migration to tablets and mobile platforms offering new ways to target consumers.

But what really makes up targeted display advertising, and how does it work? We'll take a deeper dive into this remarkable technology in the next column.

Jason Holmes is the general manager of Advocate Digital Media, a sister company to The Victoria Advocate that focuses on digital marketing. He welcomes questions and column ideas at



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