The democratization of digital marketing
- January 2021
- Phocuswright Research
With limits now being placed on tracking consumer behavior, digital marketing is moving away from anticipating future travel demand based on online behavior, toward a more targeted micro-segment marketing approach. According to Phocuswright's latest travel research article Will Privacy Restrictions Help Democratize Digital Marketing?, SEM and influencer marketing are helping to democratize digital marketing for travel companies of all sizes and shapes.
Privacy legislation in Europe (GDPR) and, more recently, in California (the Consumer Privacy Act), have altered the digital marketing landscape. These significant legal requirements, along with moves by the major internet browsers to block traditional third-party cookies used for identification and tracking, have helped establish a digital marketing world in which the future of personalization is in limbo.
The role of cookies
The primary issue impacting the future of digital marketing is the use of third-party cookies, which have formed the foundation for programmatic advertising for more than a decade. As the name implies, programmatic advertising is the real-time buying and selling of ad inventory through an automated bidding system. Third-party cookies are often used by advertisers and ad networks to target ads to expanded audiences and see how they perform. The problem is that, as a response to the GDPR and CCPA, popular web browsers including Firefox and Safari now block third-party cookies by default. Google Chrome, the most popular web browser, is scheduled to follow this lead and phase out third-party cookies over the next two years.
So what is the relationship between these strategies and the democratization of digital marketing? Simply put, large advertisers will always rule, and costs for large SEO and SEM campaigns will continue to be out of reach for many smaller players. However, the limitation of third-party cookies (which enable larger advertisers to track customers between sites) will hinder their ability to get a more holistic view of the customer, removing some of their advantage.
Ultimately, those who know their customers best will be able to use digital marketing to drive incremental sales. As insights into customers' online behavior become more limited for larger travel companies, the playing field is leveled for smaller organizations to use digital marketing reach their target audience. This is because retargeting, which allows marketers to show customers who have visited their site relevant visual or text ads when they visit other sites, has become an increasingly important tactic of large marketers. Clearly, retargeting will now become less effective with the limitations on third-party cookies, which will reduce spend by the larger advertisers who lean heavily on this strategy, opening up ad space for smaller bidders.
Microtargeting influencers enables even further democratization of digital marketing, to the potential benefit of smaller travel companies. Travel research is becoming more focused on images and videos rather than written reviews or guidebooks. The growth of Instagram's role in this shift is critical. One study revealed that two fifths of millennials choose a travel spot based on its "Instagrammability". Smaller companies can now use influencers to target niche travelers with dynamic pictures and videos, and by using this route they avoid competing directly with the global OTAs for SEO or SEM traffic.
The full Phocuswright research article Will Privacy Restrictions Help Democratize Digital Marketing? reviews the latest trends in digital marketing. In doing so, it also acts as a call to action for smaller travel companies who have not caught up in their digital marketing strategies, but who now have new opportunities to compete.
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