The investment model for owned and earned media is the inverse of mass media. It requires a more substantial investment in producing innovative content and ideas, and a much smaller (or nonexistent) investment in paid media to create the initial awareness. But the real point is that the entire investment pie is substantially smaller than the mass media paradigm described above.
Digital agencies can build popular platforms or create viral games or videos that reach millions of consumers for a fraction of the cost that it takes to reach a mass audience through television. Sure, clients may pay more for the production of high-value content or software technologies that consumers seek out on their own (or share with each other), but the overall marketing investment is smaller and more targeted the further away a brand gets from mass media.
Indeed, there are paid media investments occurring in the digital space, which make sense for all marketers. Any brand that hasn’t optimized its search results or purchased relevant key words is missing one of the greatest online opportunities to directly reach hand raisers. And online display advertising is still a great bargain, plus more highly targeted than most print or television.
But the real opportunity of the digital age, for clients and agencies alike, is the shrinking pie of investment afforded in owned and earned media. The only losers in this new investment equation are the mass media companies that controlled access to audiences for decades.
Bob Greenberg & Barry Wacksman of R/GA, ‘The Shrinking Pie’ [Adweek]