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Study: Traditional Media too Pricey for Local Businesses, Digital too Complicated

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Despite the issues of price, perceived value and complexity of traditional and digital media marketing tactics, local dealers, agents and franchisees haven’t stopped using them. Of course, according to a new study, some tactics have brought more satisfaction than others.

The State of Local Marketing report by Brandmuscle surveyed hundreds of local affiliates in 2013 and measured media usage, satisfaction, complexity, cost and co-op spending. Here are some of the highlights:

  • Coupons are the most used marketing tactic;
  • Local event sponsorship brought the most satisfaction;
  • Print (newspapers, magazines, PYP) the least satisfaction;
  • Television was considered the most costly;
  • Facebook the most complicated;
  • Paid search saw the largest increase in co-op spending;
  • Newspapers pull the largest share of co-op spending but also saw the largest decline.

Looking bigger picture, the study showed that traditional media (newspapers, magazines, radio, etc.) still has a big role in overall usage despite a consistent concern regarding price. On the other hand, digital tactics are garnering strong satisfaction among adopters, but overall adoption is surprisingly low due to the complexity of these channels and time needed to manage them.

Digging a bit deeper into the study, some glaring disparities emerge. For instance, 63% of respondents use newspapers for their marketing efforts, yet only 46% are satisfied with this media, which is the largest gap of all 19 media types studied. In addition, paid search ranks fifth in media satisfaction, saw the largest increase in co-op spending and is fourth in regards to total co-op spend, yet it ranks 11th in usage.

While the insights featured in the study reinforce industry trends – marketplace confusion, unclear ROI, digital disruption, traditional decline and the power of the good old-fashioned coupon – the developments in co-op spending are worth noting.

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While all five media types that saw a decrease in co-op spending in 2013 represented traditional media, eight saw an increase.  As mentioned earlier, the biggest increase in spend came from paid search, which leap frogged billboards, direct mail and television in just one year. Website co-op spend also jumped 3% last year, which was the third largest increase.

The trends support much of what we are seeing in regards to co-op programs offered in the space. For instance, one major auto manufacturer has moved all of their PYP co-op dollars towards digital programs, save for direct mail.  Furthermore, while we already have hundreds of digital programs in our Co-Op Online database, new ones pop-up regularly and we are seeing that many existing programs are adding in new digital offerings.

Though digital adoption still lags (a quarter of respondents still don’t have a website), educating around digital tools seems like a far less daunting task than proving, once again, the value of traditional media. Nonetheless, it will be interesting to see if traditional media entities simply lower prices or reinvent themselves with new “out-of-the-box” offerings.

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