The O&O Margin Conundrum
Why might your sellers be hesitant to offer digital advertising tactics? The top reason is often the margin that O&O delivers. It is a lucrative tactic to sell and can be very attractive to advertisers, especially if your sites get substantial traffic.
You’d never dissuade sellers from promoting O&O, and it’s easy to understand why they want to position it as a great option. The margins for third-party digital may be smaller, but there’s volume to figure into the equation. O&O has limitations regarding quantity because it’s one small sliver.
Digital advertising, conversely, involves numerous tactics. Salespeople can sell more and have higher compensation. Additionally, they are more likely to sell multiple campaigns to reach various goals — new customer acquisition, recruitment and other promotions. If they do, they could be the beneficiary of the advertiser’s entire digital budget.
Expanding Reach with Digital
O&O offers very targeted reach, typically within your city or county. That’s a great asset for local businesses. However, many want to expand this to attract people outside the area. For any company that seeks customers beyond these lines, they’ll want to use third-party digital.
For example, our recent case study with Lost Coast Communications demonstrates how this is a winning strategy. One of their clients, a local casino, wanted to target areas within traveling distance. O&O couldn’t facilitate this, but targeted display did. They were able to meet the advertiser’s needs with digital options.
If you cannot fulfill this need, your advertiser will look elsewhere, minimizing your chances of gaining more sales.
New Options Emerge for Digital Campaigns
O&O has had an advantage over digital in some categories because they are restricted, meaning not all DSPs (demand-side platforms) allow ads for the products. Those could include cannabis, CBD, gambling, alcohol or fireworks. It’s no problem to put up a banner ad on your owned properties, so that may have been one of the only tactics to use.
However, there are now digital advertising options, including static or video targeted display and geofencing, to meet the needs of clients that have budget to spend. If you can offer this, you’re sure to win more ad dollars, which they may have been investing in harder-to-track OOH (out-of-home) or print advertising.
Integrated Full-Funnel Campaigns Are the Gold Standard
What’s most vital in converting sellers and customers on the value of O&O and third-party digital is the message of integrated campaigns and creating touchpoints at every stage of the customer journey.
For advertisers to see better ROI, they’ll need to engage customers throughout the funnel, which requires a combination of tactics. When these strategies are in place, advertisers can see a 45% higher ROI and a 7% increase in offline sales compared to siloed campaigns.
O&O, digital and OTA (over-the-air) spots all have a place in this funnel. Approaching customers with this perspective (and educating them about it) helps them see the bigger picture of how they’ll meet their advertising goals and improve their brand’s visibility.
O&O and Third-Party Digital: More Tactics and More Dollars
It’s never a bad idea to broaden your ad portfolio. Each tactic has advantages for you and advertisers, and you can explain their value. Get your sellers in the habit of promoting and pitching both. If they are still hesitant, it might be because they need more training and knowledge of tactics. Upskilling your team helps them be confident in selling the whole package.
Your sales team can do digital better with Marketron NXT, an award-winning platform for proposing, ordering, executing, reporting and billing of third-party digital. In addition to software, NXT offers on-demand training on digital, exclusive content and more to keep your salespeople sharp.