We’ve stopped what we are doing and creating your personalized BrandZ™ report, which will appear in your inbox soon.

Brazil: Digital for building scale

 

With the rise of digital media came the promise of a new future in marketing: monitoring user behavior, segmenting with precision, and measuring results. Everything would be possible, thanks to technology. Then came the bubble. Right after that, Google. And the promise started to become reality.

 

Because of digital media’s capacity to segment, and especially to measure, e-commerce brands were the pioneers in making large investments, and the ones who experimented in this channel. With the goal of generating website traffic, paying per click was an advantage when compared to the cost of renting a bricks-and-mortar location. An e-commerce enterprise buys the volume of clicks that its owner’s budget allows and, depending on the effect on sales, it becomes possible to expand the business from one day to the next, without having the costs or headaches involved in opening any new stores.

 

This logic of expanding, based on concrete, observable results, started impacting not only e-commerce, but all businesses – pure online players and traditional retail brands  – for whom the digital medium has an important role in purchase decisions. Retail brands set up e-commerce operations and started investing according to online sales; automakers focused their investments to generate test-drive bookings via their sites; phone operators generated leads to their call centers; and so forth. Investments grew gradually, according to companies’ capacity to generate concrete returns on their digital investments.

 

And, for this reason, investment in digital media was always thought of and distributed in a linear way.  Beyond that, sales metrics often overlap audience metrics. While in TV and other above-the-line media we seek the quickest way to get maximum coverage, with online, we learn to be surgical, attempting to reach only highly qualified audiences, which are most likely become buyers. On one hand, we gain efficiency. On the other hand, we lose impact and the capacity to mobilize a wider public.

 

But this is changing, and two key factors have contributed to this: digital media has acquired maturity and volume (which makes high impact possible) and there have been advances in the use of data and technology (which make it possible to track sales that happen at the physical point of purchase).

 

Online Impact

 

For a few years now, digital has been the second most-used medium for consumers in Brazil. Among younger demographic segments, digital has a penetration similar to TV – with the difference being that a cell phone is checked more than 100 times a day (meaning 100 possibilities of interaction for a brand). Beyond this, video formats are now dominant in the medium.  Hence, the online universe can be used to create impact, not just for delivering complementary audience points over the duration of a campaign.

  

Digital is now mature enough to play a leading role when building coverage. However, the possibility of building coverage quickly should not replace the traditional forms of buying digital media.  These strategies should be complementary.  When launching a campaign, we build coverage quickly with concentrated investment.  The concentrated impact generates immediate interest, and efficient buying creates frequency.  This combination brings digital media to the center of a strategy.

 

Measuring at the point of sale

 

Due to the nature of the medium, being efficient in buying audience exposure is not enough. It is just a starting point. It is important to understand what happens after the user interacts with brand activity.

 

In spite of the maturity achieved by e-commerce, it is known that less than 10 percent of all sales in Brazil take place online.  In other words, if we don’t measure what happens in the physical world, we are missing the real impact of digital media. Thanks to data-capturing technologies, it is possible to link digital investments to sales in bricks-and-mortar outlets. However, whether by beacons, data management platforms, store visits, or any other form of measurement, understanding the impact of investment directly at the point of sale is essential.

 

Perhaps this is the greatest change we are experiencing.  Digital media was always seen as a channel that generates efficiency, and this efficiency was always measurable in the online environment. Today, this discipline not only has the capacity to make an impact in formats that build brand and generate omnichannel traffic, but can also measure this traffic and, consequently, sales. This makes all the difference, so that agency and client can always be on the same page: in the relentless pursuit of business results.