Digital marketing: what it is and how it works?

In today’s 21st century, digital marketing has become most essential tool for businesses of all size and the demand is on whole another level. but if you wanna know what exactly is digital marketing, how it works and how does it work to benifit your bussiness. this guide will help you to understand and explore the key concept and strategies behind digital marketing. we have also talk about its key components, pros, cons and differences from advertising on the internet.

What is digital marketing?

Digital marketing is the use of online platforms and technologies to promote products, brands or services to targeted audience using various strategies and channels such as website, social media, search engines and email etc.

Digital marketing is a versatile and ever-evolving strategy that requires constant adaptation. Platform innovations and restrictions, such as banned emojis or ad blockers, can significantly impact your marketing approach. Additionally, limitations on data protection, such as user cookie acceptance, can affect the amount of information marketers have access to. To succeed in digital marketing, it is important to stay proactive and flexible in the face of these challenges.

In short, using of internet to promote or sell product to reach and engage audience is known as digital marketing.

Digital marketing is based on traditional marketing, which specialists execute through digital communication channels. For example this is advertising that can be seen on social networks and websites. digital marketing tools are used when a viewer in an online cinema is asked to go to social networks to participate in a competition , or scan a QR and win prize.

Digital marketing differs from traditional marketing in the platforms on which marketers promote products ad in a wider range of tools evaluating results. For example, in advertisement accounts you can find out exactly how many users saw the advertising and clicked on the ad, how much the advertier paid for each click, and even what combination of pictures and text attracted the right customers.

Before digital television came along, it was almost next to impossible to check how many people were watching TV and seeing advertisements. marketers did not know for sure how much sales of a product increased due to television advertisement, and what the significance of the display promotion in the store was with advent of digital television and digital marketing tools, TV advertising has been integrated with other digital channels. now advertisers invite the viewer to scan a QR code or write a code word on social netwoks and use this data to track purchases and advertising effectiveness.

Key components of digital marketing:

1. Content marketing

This is creating for blog post or brand media company. if you regularly publish content that is interesting to your audience, there is every chance of attracting attention to your product or service.

2. Websites and blog

You can publish useful materials on your own website or start blog on a third-party site like medium or habr. a blog is an important channel for working with brand awareness and prepairing the audience for purchase.

3. SMM

“Social media marketing” SMM helps to attract traffic or audience attenction through social networks. this promotion channel helps to find loyal audience, receive feedback about the product, increase user activity to make the product or service more recognizable and attractive.

4. Performance marketing

Specialists of this channel are responsible for purchasing coverage and targeted user actions. this includes contextual and targeted advertisement, CPA networks.

5. Contextual advertising

The channel is closely related to user requests in search engines. from these, a list of keywords is formed, by which algorithms select and display suitable advertising for specific person.

6. Targeted advertising

Thanks to detailed settings in advertising accounts, ads are shown to the target audience with the specified parameters. Typically, such advertising is posted on social networks. For example, you can target those who have already purchased and even completed a C++ programming course, and offer to learn how to successfully pass interviews.

7. CPA networks

These are online platforms where advertisers and webmasters agree on cooperation. these include advertisement in mobile applications that the user must watch, For example, to get an extra life in the game.

8. CRM marketing

The field of digital marketingm which is closely related to user data. CRM marketers are responsible for communicating with the audience: they make mailing, send push notification, engage is SMS marketing and call potential clients.

9. Push notification

This channel helps to retain your existing audience. For example, if a user adds an item to the cart but does not complete the order, an hour later he recieves a push notification with reminder.

10. Email marketing

Email marketing is letters from a brand that users recieve by email. they can be about brand products or promotions, with useful or entertaining content.

11. SMS marketing and calls

The channel helps promote a company’s products or services through short text messasges or directly through a telephone conversation.

12. SEO

“Search engine optimization” SEO helps you get traffic from search results. the more people following their request go to a specific site in search results depends on several factors: how correctly the technical part of the task was completed (For example, are there any errors in the HTML code, language markup of the site) and whether the content meets the user’s request, which ultimately builds trust in the product and company.

13. Affiliate marketing

Exchange of affilliate links, joint promotions and advertising campaigns help reduce marketing costs and increase audience reach. For example, if a user makes purchases in an online store, he may recieve a discount coupon or promotional code for another service.

Influencer marketing, or influence marketing

People trust bloggers whose stories they watch every day on social networks, and podcast authors they listen to while jogging. Advertising with bloggers helps to attract the most loyal audience.
Each channel has its pros and cons. The main thing is to decide which one solves a specific problem and decide on a promotion strategy. To do this, you need to take into account various factors: tactical and strategic business goals, digital marketing resources and, of course, the characteristics of the audience and product. For example, the same electronics and household appliances store can actively advertise a game console with bloggers, and set up contextual advertising and work with SEO to sell industrial refrigerators.

How to evaluate the effectiveness of digital marketing

Here are some key matrics that can help you understand whether a particular ad is performing well and how much the reach or purchase ultimately cost.

1. CTR (Click-through rate)

Click-through rate. CTR shows how often users who see an ad click on it. Helps assess how interesting the offer is to the audience.

CTR = CLICKS\IMPRESSION *100

2. CPC (Cost per click)

Cost of a click. shows how much eachh transition from an advertisement to a landing page costs. helps marketers estimate the costs of a click in different advertising channels.

CPC = TOTAL COST PER CLICK \ NUMBER OF CLICK

3. CPA (Cost per action)

The cost of the target acction. the matrics helps to estimate how much a call, application, filling out a form, or a chat communication costs.

CPA = TOTAL COST \ NUMBER OF ACTIONS

4. CAC ( Customer acquisition cost)

The average amount spent on attracting a new client. If in CPA anything can be considered a target action, then for CAS it is always a purchase. Therefore, only those customers who purchased a specific product or service are counted. Marketers calculate CAC to understand how well a campaign is performing and how they can reduce advertising communications costs.

CAC = TOTAL MARKETING AND SALES COST \ NUMBER OF NEW CUSTOMERS AQUIRED

At different stages, depending on the goal, companies can choose different key metrics. For example, if Sberbank decides to launch a brand campaign to talk about a new service, marketers will look at coverage, because purchases at this stage are not the main thing, it is important that as many people as possible learn about it. And in targeted advertising, the defining indicators will be specific actions – for example, how many people issued a credit card after viewing the advertisement.

Pros and cons of digital marketing

Companies offers marketers interesting work that combines creativety and analytics. not without stress and high competition among specialists. lets look at other pros and cons.

Pros:

✅Ability to show ads only to the target audience.

Marketers use targeting so that an ad for a travaker debit card is seen by people who fly frequently to different countries, and discounts on products for children are seen by mothers.

✅Accurate performance indicators.

For the first time in digital marketing, it became possible to evaluate the results of advertising campaigns in detail: from reach to purchase price.

✅ Budget communication channels.

You can run advertising with at least 500 rubles in your account. Advertising on television costs hundreds of thousands of rubles.

✅ Quick response.

Digital marketing provides instant communication with users through social networks, email, instant messengers and chats on the website.

✅ Opportunity to change the industry.

Marketers can make familiar things more convenient and technologically advanced. For example, once upon a time an SMM specialist would respond to comments on social networks from time to time , but now customers can talk to a virtual support assistant at any time of the day.

Cons:

❌ You need to be prepared for changes and be able to quickly adapt to platform innovations.

Often, everything can break down simply because the site has introduced restrictions on displaying advertising. In this case, you have to quickly change your strategy. For example, VKontakte banned the use of emojis in the text of advertisements, and for some brands all communication with customers was based on this.

❌ Ad blockers.

Part of the audience is lost because some users set restrictions on displaying advertising in browsers. For example, this is often done by IT specialists – a solvent, desirable audience for many companies.

❌ Restrictions due to data protection.

If the user has not accepted the cookie, the marketer receives significantly less information about the user and their interaction.

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