How strategic Content Marketing is driving the shift of marketing budgets into digital

1. CONTENT MARKETING IN
THE DIGITAL DRIVER’S SEAT
How strategic Content Marketing is driving the
shift of marketing budgets into digital
By: Tim Walters, Ph.D. & Robert Rose

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ScribbleLive is delighted to support the whitepaper “Content Marketing In The
Digital Driver’s Seat”, in partnership with the Content Marketing Institute (CMI).
The notion that advertising is enduring fundamental changes - both in format and
budget - could not be more true, with some analysts predicting that digital ad
revenue will grow at a compound annual rate (CAGR) of 11% in the next five years,
while traditional media revenue will grow at just 0.4%. Given the implications of
this shift, marketers are rushing to re-evaluate their approach to reaching their
audiences in a more efficient and impactful manner. The goals of this whitepaper
are to 1) identify the gradual shift towards digital marketing expenditures, and
2) emphasize reasons why companies should invest more resources in content
marketing solutions. The information delivered in the paper tells a fascinating story
and emphasizes tangible benefits that are achievable by investing in an exhaustive
content marketing plan.

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For years, analysts have puzzled over the uneven distribution of advertising and marketing budgets in the
digital era. Despite the rapid shift of consumers’ time and attention to the internet and later to mobile web
and apps, spending has remained stubbornly weighted towards traditional media. For example, Mary Meeker
pointed out in her 2014 Internet Trends report, that while print media (newspapers and magazines) account-
ed for just 4% of total media consumption in the United States, they received 19% of all advertising spend.
This relationship was precisely inverted for mobile, which accounted for 20% of consumption but just 5% of
the advertising revenue.1
Ad budgets have been migrating to digital since the advent of the internet, but recently the shift has accel-
erated, and appears to have reached a tipping point. In early 2015, the New York Times reported that major
U.S. advertisers such as Procter & Gamble are “sending their dollars to digital,” even while reducing overall
ad spending, thanks to the cost efficiencies of digital channels.2
Looking forward, BI Intelligence predicts that
digital ad revenue will grow at a compound annual rate (CAGR) of 11% in the next five years, while traditional
media revenue will grow at just 0.4% (and print media will shrink by up to 2.5%).3
Further, Magna Global fore-
sees total digital ad revenue exceeding that of television in no more than two years.4
Why did it take so long? It’s convenient (and common) to attribute the delay to stick-in-the-mud tradition-
al marketers, who were unable or unwilling to acknowledge how quickly consumers shifted their time and
attention to digital media. Old habits die hard. As Forrester noted in 2014, “many marketers continue to
approach marketing much as their 20th-century forbearers did” – namely, with mass market, interruptive,
acquisition-based programs.5
On this view, marketers continued to operate business as usual until the pain –
and the threat of irrelevance – finally became too great to ignore.
But there’s clearly another factor at work and it’s one that gives a lot more credit to marketers. When we ask
why ad revenue hasn’t (more quickly) followed the shift in media consumption, we tend to ignore the fact
that an hour watching, say, prime time network television in 1995 is nothing remotely like an hour of mobile
INTRODUCTION
Content Marketing Rides Shotgun

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media consumption in 2015. In other words, ad spending cannot and should not simply march in lock step
with consumption rates (on a percentage basis) because “attention” and “time spent consuming” have
fundamentally different meanings and implications in digital media.
That means that it has taken time to identify, investigate, and understand the particular dynamics of digital
advertising, marketing, and customer engagement. In particular, the booming interest and investment
in content marketing in the last few years is solid evidence that (some) marketers have been diligently
investigating the impact of digital, and crafting new or refined marketing (and content) practices that
will allow their companies to adapt to and thrive in this new, data-centric, highly personalized digital
environment.
We know that content marketing typically takes the form of digital blogs, social posts, webinars, online
events and e-newsletters. But, increasingly, digital content is being leveraged for more physical expressions
of content such as in-person events, print magazines (such as Kraft’s Food and Family Magazine). It is thus
largely, but by no means exclusively, a product of the digital age – but is inherently influenced by it.6

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When corporate websites appeared in the 1990s, they were treated as company brochures, then as direct-
mail catalogs, later as store fronts. Similarly, digital advertising formats, such as banner ads (i.e., billboards)
and pre-roll videos (i.e., TV commercials) extend the practices of the “old” media into digital channels.
Moreover, far too many companies and brands use Twitter and Facebook as mass media, broadcast
platforms, rather than as a conversational channel.7
Even in the context of analog media, these kinds of legacy “interruption advertising” formats were, at best,
staking a parasitic claim to consumers’ attention. In the midst of compelling content, such as a prime-time
TV show, the traditional 30-second commercial would buzz in like a mosquito at a summer party, hoping to
siphon off a few precious drops of attention before the viewers could find the mute button or flee the room
in despair. The infamously poor recall rates on commercials and other mass media advertising are clear
testimony to the ineffectiveness of this approach.8
In contrast, content marketing, as it has emerged, matured, and expanded in the digital era (for example,
exhibiting 44% growth between 2011 and 2012), has adapted precisely to the profoundly different ways in
which information is now produced, exchanged, and used.9
Digital creates a whole new kind of consumer
Taken together, the forces of “digital disruption” – above all, the fact that everyone now carries around at
least one super computer in their pocket, together with the inescapable popularity of social platforms –
have famously created the “age of the consumer.” It’s very important to grasp that this doesn’t just mean the
buyer is in charge of the sales courtship for the first time in history. It has also fundamentally changed the
consumers’ relationship to information and redefined what it means to be a consumer.
Traditionally, a consumer was a future buyer, who was moved step-by-step through the sales funnel with
various enticements and offers, all carefully timed and controlled by the seller. Today, we should rather see
digitally-empowered consumers as demanding, voracious, and insatiable creatures that devour and gobble
up information, which they expect to receive in the times, formats, and contexts that they dictate. Second (and
Coming To Terms With The New Driver
Of Digital Strategy

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for this very reason), prospects and customers value and respond far more positively to information – or more
broadly content, whether it is informative, entertaining, educational, inspirational, etc. – than to advertising.
Among business buyers, for example, Forbes reports that 80% “said they prefer to get information via articles,
rather than ads. Seventy percent said content makes them feel closer to a company, and 60% said content
provided by companies helps them make smarter buying decisions.”10
The multiple benefits of sharable marketing content
Content marketing is purpose-built to respond to and take advantage of these developments, delivering
to companies and brands the best possible performance with digitally empowered consumers. Instead of
parasitic, interruption advertising, content marketing feeds the hunger for information with content that
consumers find valuable on its own accord, content that they crave, enjoy, and want to share. Sharable
content is, in fact, a very powerful aspect of high quality content marketing efforts, with benefits for everyone
involved. When I share information, I feel good about providing my friends or connections with a valuable
“gift,” and they benefit from the endorsement by someone they trust. And ultimately, the company or brand
that provided the information benefits from higher quality prospects and more transactions. One study of
millennials, for example, concluded that for these digitally advanced consumers, “interactivity and discussion
are far more likely to influence purchase decisions than viewability.”11

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As spending shifts from traditional to digital, marketers might be tempted to continue exercising their mass
media, broadcast muscles with digital equivalents, especially display ads. However, numerous technology
and social factors now clearly expose the error in this approach. Marketers seeking an effective return on
digital spend must carefully consider:
The shockingly poor performance of digital display advertising: When the web was a nascent and
unproven medium, expectations for web site display advertising were understandably low. Moreover,
standards and practices for measuring ad effectiveness were poor. Now, as a relatively mature medium
that is indispensible to many mainstream businesses and brands, online advertising is under the
microscope – and it’s not a pretty picture. According to the Google Doubleclick network (which ought
to know better than anyone), the average display ad click through rate (CTR) is 0.1%. For the popular
468x80 pixel banner ad, is no better than 0.04% (four hundreths of one percent!) That means that, on
average, 99.9% of viewers do not click on a displayed ad. As Solve Media has quipped (based on their
own CTR data), you’re more likely to survive a plane crash, summit Mt Everest, or complete Navy SEAL
training than you are to click on a digital display ad.12
The vanishing human audience: Beyond click throughs or other actions, digital display advertising
can serve as direct brand exposure – old fashioned eyeballs on the ad. And yet, how many of those
eyeballs are attached to actual people? As early as 2013, Incapsula calculated that over 60% of all
internet traffic worldwide is “non-human” – meaning bots.13
This bot traffic, combined with broken ads
and alleged outright fraud, could mean that only 8% of all ad impressions even have a chance of being
viewed by a real person.14
Industry groups such as the Interactive Advertising Bureau (IAB) and major
advertisers have launched efforts to promote transparency and reduce fraudulent traffic. Still, the
practice of banner ads is clearly at a watershed moment, which has prompted one observer to ask, “Will
digital advertising change or vanish”?15
Content Marketing Moves Into
the Digital Driver’s Seat
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The rapidly growing use of ad blockers and do not track: When Facebook radically trimmed the
default privacy settings in 2010, Mark Zuckerberg said it reflected “changing cultural norms.” Indeed,
the prevailing sense has long been that we are witnessing “the end of the privacy era,” that millennials
(naturally) and all right-thinking adults (eventually) are increasingly comfortable with the idea of being
sold to advertisers in exchange for free internet content, and of trading personal data for (alleged)
relevance.
In practice, however, we’re clearly moving away from this post-privacy internet. Consumers of all ages
and demographics are increasingly adopting ad blockers and “do not track” technologies. Worldwide,
ad blocker usage has shot up 400% in barely two years, from around 50 million in June 2013 to over 200
million today. In the U.S., adoption increased 48% in just the last year. The total loss of revenue due to
ad blockage is estimated to be nearly $22 billion.
In short, digital display advertising has three big problems: 1) It doesn’t engage views and entice them to take
action (like, click on it). Which isn’t too surprising given that 2) The majority of these viewers are, well, dead
– in the sense of non-human bots. And 3) Actual living people increasingly will go out of their way to avoid
being exposed to it at all.
All of which points to the need for a different approach, one that truly engages consumers rather than
enraging them, one that they will actively seek out instead of hiding from, one that conveys useful information
rather then consistent irritation. Content marketing fits the bill. Of course, that’s not to say that content
marketing should be anyone’s only digital marketing activity. But because, by definition, it builds active
subscribers and audiences that willingly give their time and attention to your marketing efforts, a successful
content marketing program cannot possibly fall prey to bots or blockers.
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For decades, marketers depended upon publishers and broadcasters to produce, package, and distribute the
content that could deliver the audience for ads. Today, any company or brand can become a broadcaster (on,
for example, YouTube) or a publisher (on, say, Medium) at virtually no cost beyond the content production.
And of course that content production breaks down the old barrier between editorial and advertising.
Marketers are released from the product-feature and brand-message straightjacket, and can now speak
directly to the needs and passions of any specific target audiences – say, people who take long car trips
with their dogs – by offering advice, tips, entertainment, news, and comparisons. (Plus, they’re no longer
restricted to the available publishing outlets, which would have meant splitting the ad budget between car
sites and pet portals.)
Naturally, the low barrier to entry only makes it easier to start. The hard work of content marketing is about
attracting, nurturing, and retaining an audience – over the long haul, and producing consistently high-quality
content that’s relevant to their varied and changing needs and delivered on the desired mix of media and
channels. Given the right dedication and focus, content marketing has grown into a distinct publishing
business for brand such as Kraft and Marriott.
There are many tools that can be adapted to assist with this work, including blogging software, web content
management systems (WCMS), and marketing automation platforms (MAPs). But since they were each built
to do something else, they are missing important pieces of the puzzle, and may be as likely to hamper and
frustrate teams that are beginning to pursue content marketing strategies. This problem is now addressed by
platforms designed specifically to support content marketing, including content creation, curation of outside
and user-generated content, editorial calendars, audience segmentation and targeting, cross-channel
coordination, and analytics.16
The best of these platforms also ensure integration with existing content tools
such as WCMS, and the ability to that track and report on the performance of specific content assets, in a
unified way across various audience segments and channels.
The New Marketing Checkered Flag

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This is where the race is won
The best traditional marketing has always consisted of fantastic content – magazine ads and commercials
that were entertaining, shocking, or enlightening, and that compelled viewers to share them, talk about
them, and seek them out. As content marketing has emerged and developed in the digital era, it has opened
a massive new opportunity for great content. This opportunity is massive, not only because digital lets you
identify and address finely segmented “long-tail” target audiences, so you can reach more people with more
specific interests. It is also massive because great marketing content is no longer just the rare, one-in-a-
million ad; today, it can be an ongoing, living campaign that directly addresses what people care about most,
their deepest passions and concerns.
This is another, and perhaps the most important, reason why marketing budgets are finally shifting from
traditional to digital media. Even mature traditional marketers can now see that great content spans the
analog/digital divide – and that digital creates ways to put it to work that are far more effective and which
benefit sellers and buyers alike. As the Forrester analyst Jeff Ernst has noted, in the age of the consumer,
people “no longer ‘buy’ your product, they ‘buy into’ your approach to solving their problem.” Marketing an
approach to solving a problem actually releases marketers from the constraints of product/feature/brand-
centric interruption advertising and makes it easier to create great, memorable, desirable content.
Reaching the finish with more relevance and engagement
Above all, while the medium has changed, the marketing challenges and goals remain familiar. For example,
marketing still needs to “feed the top of the sale funnel” by creating brand awareness, recognition, and
allegiance. In the past, this might have been achieved (or at least addressed) by running a commercial
that said, in effect, “If you have really dirty clothes, think about using our soap.” Um, ok, thanks for that. In
contrast, content marketing says, “Do your kids always make their clothes filthy? Here are five great summer
holiday destinations for kids who love to get dirty. Here’s an article about maintaining a division of school
clothes and play clothes. And why don’t you submit a photo to our Instagram contest for the muddiest blue
jeans?” The allegiance that results from that kind of content feeds the funnel with far, far better prospects that
have a genuine human connection to the brand.

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Content marketing is driving the shift of marketing budgets into digital because it is the only marketing
practice that has grown up with, and is entirely in sync with, the ways in which digitally empowered
consumers now seek, share, use and gorge on information. Marketers aiming to take advantage of the
unique benefits of content marketing should:
Address specific problems: You may have the largest selection of mountain bikes and equipment
west of the Rockies – but that’s not a solution to a problem any consumer is aiming to solve.
Instead, talk about finding the best trails, choosing the right equipment for winter biking, or
how to organize team rides. Note that you can (and probably should) aim to create audiences
around multiple specific problems. For example, one blog that helps beginners get into downhill
racing comfortably, plus an Instagram site for extreme biking photos, etc. Also, remember that
the “problem” isn’t necessarily some issue that has to be resolved. As an avid mountain biker, my
“problem” might be where to find a daily fix of racing videos, diet planning before a long ride, or
finding the best trials on my holiday. In general, if you are feeding a passion, you’re addressing a
problem that can be at the core of a content marketing program.
Provide consistently high quality content: Content marketing is about aliens, not fish. Which means,
you can’t expect to hook a prospect with a single engaging article and then just reel them in. It’s rather
like the kids in the movie E.T. leading the alien out of the tool shed with Reeses Pieces.17
Consumers have
too many alternatives, and too much switching power, for you to take their allegiance for granted. You
need to serve up one attractive morsel of content after another if you want to maintain the attention of
the audience and create future buyers.
Remain dedicated for the long term: Kraft has been diligently working on their exemplary (and very
successful) content marketing strategy for eighteen years. Conversely, the best (and most common)
way to kill a promising content marketing initiative is to demand short-term sales or revenue impact.
Conclusion:FourStepsto
DrivingContentMarketingSuccess
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Say that you meet a very interesting person at a dinner party; it could be months or years before you
think of them as a dear and reliable friend. Similarly, content marketing aims to establish your company
or brand as a trusted advisor, not just a source that sells stuff. Where can I get reliable (and objective!)
information about the city I’m visiting? Answer: Marriott’s travel guide.18
Where can I always find great
stories, photos, and videos about the latest crazy extreme sports? Answer: Red Bull’s media businesses,
such as the Red Bulletin magazine. None of this is tied directly to short term sales – but it pays off
multiple times by created avid and brand conscious future buyers.
Line up the right resources and tools: Make no mistake: content marketing is not simple. (If it were,
everyone would be doing it, and that would cancel out the clear advantages and benefits you can
realize with it.) But the hard parts have mostly to do with how new it is. As the previous points indicate,
content marketing requires marketers to adapt to new ways of attracting consumers, new ways of
maintaining their interest and attention, and new time frames for nurturing these relationships before
they blossom into the ripened fruit of a transaction. In addition, content marketing may well require
new skill sets, such as subject matter experts to produce or vet content. All of this newness creates
friction and resistance. Marketers that genuinely want to achieve long term success with content
marketing (and if you don’t, why bother in the first place?) can avoid compounding these problems by
considering the adoption of a dedicated content marketing platform, rather than trying to jury-rig a
solution out of other tools, such as WCMS or marketing automation.
It’s finally happening. The digital shift was always inevitable. Now it is clearly undeniable and irresistible. It is
fair to say that most marketers have fallen behind; most consumers got on the digital train that left the station
several years ago. Because it understands and participates in the ways in which they get, share, and use
information, content marketing leads the effort to catch up with digitally-empowered consumers.
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End Notes
1. Mary Meeker’s 2014 Internet Trends report is available at http://www.kpcb.com/blog/2014-internet-trends.
Note that these figures are based on 2013 data.
2. “Biggest Advertisers Are Sending Their Dollars To Digital,” New York Times, March 18, 2015. See
http://www.nytimes.com/2015/03/18/business/media/biggest-advertisers-are-sending-their-dollars-to-digital.html.
3. See http://uk.businessinsider.com/how-ad-spending-on-mobile-will-grow-faster-than-on-any-other-
advertising-channel-2015-7.
4. See http://adage.com/article/agency-news/digital-ad-spending-pass-tv-2017-magna-global/296090/.
5. See the 2014 Forrester report, “The New Calculus of Marketing: How Marketing Leaders Must Reengineer
For The Internet of Customers,” available at http://www.exacttarget.com/system/files_force/forrester_the_
new_calculus_of_marketing_tlp_4.14.pdf?.
6. The farming equipment manufacturer John Deere & Company is widely credited with having invented
content marketing with the introduction of their print magazine The Furrow in 1985. As Joe Pulizzi
explains, “Deere leveraged The Furrow, not to sell John Deere equipment directly (as a catalog would do)
but, instead, to educate farmers about new technology and how they use it to become more successful.”
See http://contentmarketinginstitute.com/2013/09/content-marketing-history-and-future/.
7. eConsultancy noted in 2013 that “25% of top brands still use Twitter for broadcasting.”
See https://econsultancy.com/blog/63251-25-of-top-brands-still-use-twitter-for-broadcasting-rather-than-
engagement/. See also “The broadcast medium formerly known as social media,” at http://nickusborne.
com/the-broadcast-medium-formerly-known-as-social-media/.
8. For example, a 2007 analysis of TV commercials aired between 1992 and 2006 found a recall rate of
22.5% for 30 second spots and a rate of 16.6% for 15 second commercials. See http://www.wsm-inc.com/
publications/pdf/by_the_numbers.pdf.
9. This statistic is from a March 2012 report by Content Wise and the Custom Content Council.
See http://www.emarketer.com/Article.aspx?R=1008991.

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10. The Forbes article refers to a survey by Roper Public Affairs. See “Use Content Marketing to Boost Your
Business,” at http://www.forbes.com/sites/capitalonespark/2013/01/23/tell-dont-sell-use-content-
marketing-to-boost-your-business/.
11. For their 2014 report, ShareThis analyzed the online browsing and social patterns of 58 million U.S.
millennials over four months. See http://www.sharethis.com/learn/knowledge-center/research-2/new-
consumer-study-millennials-2x-likely-purchase-products-share.
12. As one journalist has noted, “it’s unclear how [Solve Media] figured all this out, or if the methodology is
allthat sound.” Nevertheless, the comparisons provide a way to visualize the extremely low click through
rates for display ads. See http://www.thewire.com/business/2011/06/you-are-more-likely-survive-plane-
crash-click-banner-ad/39429/.
13. The Atlantic article reports that the percentage of human traffic declined by over 10% in just one year
(2012: 49%; 2013: 38.5%). See “Welcome to the Internet of Thingies,” at http://www.theatlantic.com/
technology/archive/2013/12/welcome-to-the-internet-of-thingies-615-of-web-traffic-is-not-
human/282309/.
14. See “The Alleged $7.5 Billion Fraud in Online Advertising,” at https://moz.com/blog/online-advertising-fraud.
15. “Will Digital Advertising Change or Vanish,” at http://www.bizjournals.com/phoenix/blog/
techflash/2015/08/will-digital-advertising-change-or-vanish.html.
16. Because the content marketing technology space is young and rapidly evolving product lists and
evaluations often indiscriminately group point solutions (that support, say, content curation or analysis)
with broad content marketing platforms. Platforms – from vendors such as Contently, Percolate, Kapost,
and ScribbleLive, among others – should, in our view, provide support for content planning, production,
distribution, analysis, and overall content marketing management.
17. See https://en.wikipedia.org/wiki/E.T._the_Extra-Terrestrial.
18. As the Ad Age article announced, “Marriott wants to own the travel entertainment space—and, in turn,
gain the recognition as a trusted source for all travel needs.” See http://www.adweek.com/news/
technology/marriott-launches-global-creative-and-content-marketing-studio-160443.

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