What is Digital Marketing? (A Crash Course for Executives)

Jonas Sickler SEO Manager
Key Points
  • Digital marketing is a subset of marketing that leverages technology, the internet, and electronic devices to promote products and services and engage with consumers.
  • Digital marketing isn’t about being louder. It’s about being relevant and ready when your customers take action.
  • There are many types of digital marketing to consider, including SEO, content marketing, paid search, display advertising, native advertising, email, affiliate marketing, and more.

What is digital marketing

Digital Marketing

Definition

Digital marketing is a subset of marketing that leverages technology, the internet, and electronic devices to promote products and services and engage with consumers.

In order to fully understand what digital marketing is, and why it’s the best way to reach your target audience, you need to know how technology shaped consumer attention over the last 50 years.

Afterall, marketing is about delivering your message to the right audience. And technology dictates the rules of the game — for better or for worse.

Digital marketing didn’t emerge overnight, and it’s constantly evolving. In fact, the way digital marketing works today is completely different than how it functioned two decades ago.

So, let’s load some plutonium into our Delorean, set the date for June 1, 1971, and see how it all began.

The rise of digital marketing

Sony Trinitron ad of a family huddled in front of a small TV in 1971

In 1971, most Americans huddled in front of a handful of television channels during prime time viewing hours. This pool of concentrated consumer attention allowed brands to reach a massive, captive audience with their marketing messages. However, demographic segmentation was nearly impossible.

Then, over the next three decades, cable television boomed. And by 1999, about 70 million U.S. households subscribed to cable TV and had access to more than 50 channels.

While cable was experiencing its golden age, the internet emerged in the mid-1990s, and it revolutionized how people communicated. This was the moment digital marketing was born.

Finally, by 2007, the majority of Americans had broadband internet which allowed mobile devices, tablets, and laptops to become the new gateways to information and entertainment. Constant access to online streaming services, websites, and YouTube gave consumers the courage to cut the cord with cable. This drew advertising dollars away from cable networks and fueled the rise of digital marketing as we know it.

Digital marketing promises to reach individual consumers at an unbelievable scale.

Today, brands don’t compete with a few networks for a couple of hours for consumer attention. They compete with billions of voices, 24 hours a day, all shouting for attention.

But, digital marketing isn’t about being louder. It’s about being relevant and ready when your customers take action.

Overview of digital marketing

87%

87% of consumers start their buying journey online

Salesforce
90%

90% of consumers use online search before visiting a store

Think with Google
82%

82% of smartphone users consult their phones in-store

Think with Google

As you can see from those statistics, digital marketing is crucial throughout the customer journey. Whether folks search Google for solutions, or they use social media to engage with customer service, or they shop online and pick up in stores, digital marketing plays a role at each step in the buying process.

I’m not just talking about ads. Digital marketing is about engineering a strategy to be first when your audience is ready to act. It’s about creating a seamless, cohesive customer experience — both online and offline — that builds trust, amplifies engagement, and fosters loyalty.

There are many different digital marketing tactics and strategies to consider, including:

  • Search engine optimization (SEO)
  • PPC / Google Adwords
  • Online PR
  • Content marketing
  • Video marketing
  • Social media
  • Retargeting
  • Display ads
  • Native ads
  • Search engine marketing (SEM)
  • Email marketing
  • Influencer marketing
  • Mobile apps
  • Geotargeting
  • Affiliate marketing
  • Websites
  • Conversion optimization
  • Podcast sponsorships

The ideal strategy isn’t about using every single option. It’s about finding the ideal mix for your customers and business needs.

Non-digital marketing channels are shrinking

By contrast, the number of viable non-digital strategies is shrinking. According to Zenith’s Advertising Expenditure Forecast, advertising spend across traditional marketing channels, including TV, radio, newspapers, and magazines, will continue to erode as dollars pour into digital marketing.

Zenith estimates that U.S. online ad spend will reach 59.8% of all advertising outlay by 2022.

share of U.S. ad spending by medium

Furthermore, eight of the top ten media channels for CMOs are digital, according to Nielsen data.

chart of the most important digital marketing channels vs traditional

3 Most important things to learn about digital marketing

These are the three most important things I hope you learn about digital marketing from this guide:

  • One plus one equals ten
  • Don’t trust user targeting
  • Google is your homepage

One plus one equals ten

image of an spiral to show how digital marketing amplifies results

The true power of your digital marketing strategy comes from integrating all of the channels within your marketing mix. When you build a more cohesive strategy, you’ll amplify your results much more than the sum of its parts.

Customer touch points collectively influence future purchase decisions. Each micro-interaction, including news reports, advertisements, social media comments, blog content, and personal conversations amplifies the next touch point.

Here’s what McKinsey & Company says about the importance of accumulated brand impressions throughout the buying journey:

Those accumulated impressions then become crucial because they shape the initial-consideration set: the small number of brands consumers regard at the outset as potential purchasing options.

The takeaway? Integrated marketing aligns your resources and initiatives to improve efficiency and amplify results.

Don’t trust user targeting

Programmatic ad targeting is disturbingly inaccurate.

One report claims that Facebook’s interest precision in the U.S. is only 41% (and could be as low as 9%). But, the problem is bigger than Facebook. Another report states that even gender targeting is only accurate 42.3% of the time with programmatic advertising. Furthermore, if you combine two parameters, like age range + gender, the accuracy drops to 24%, on average.

In other words, you’d reach the right audience more often with a spray and pray approach than through programmatic advertising.

The takeaway? Don’t rely on programmatic user targeting. Instead, leverage digital marketing to target user search behavior. (I’ll come back to this point in a bit.)

Google is your homepage

Remember those statistics I mentioned earlier?

  • 87% of consumers start their buying journey online
  • 82% of smartphone users consult their phones in-store before making a purchase

Consumers will inevitably encounter the digital version of your brand. And what they find will influence their opinion of your company. Often, their first digital interaction occurs on Google.

When you evaluate your brand’s online presence, ask yourself the following questions:

  • Is your online messaging consistent with your offline messaging?
  • Does your digital customer experience match your in-store experience?
  • Do you control the narrative on the first page of Google?

Even if you don’t have negative content in your search results, the wrong narrative can impact your business.

The takeaway? Google search results don’t just influence shopping decisions. They also impact sales, hiring, and investor relations. So, treat the first page of Google like your website’s homepage.

Benefits of digital marketing

glowing rainbow heart to show the benefits of digital marketing

This is an executive’s guide, so I won’t run down a massive list of every metric you should track. Instead, I’ll cover the four most important, high-level business benefits of digital marketing.

  • Brand awareness
  • Brand sentiment
  • Customer loyalty
  • Revenue growth

Digital marketing amplifies brand awareness

One of the many advantages of digital marketing is that it’s exceptionally good at attracting and engaging new audiences. In fact, some of the best content marketing you’ll find isn’t intended to sell products. Rather, it exists to entertain and educate folks while also building brand awareness.

Brand awareness doesn’t instantly translate into sales. However, the cumulative effect of repeated interactions with your company amplifies brand recognition and establishes trust. So, when your audience is ready to act, you’ll already be on their shortlist.

Digital marketing improves brand sentiment

67%

67% of customers are influenced by online reviews

Moz
50%

A strong employer brand can reduce cost per hire by up to 50%

Glassdoor
63%

Reputation accounts for 63% of a company’s market value

Weber Shandwick

One of the most important purposes of digital marketing is to shape brand perception. The reason it’s so critical is because brand sentiment directly influences whether customers make a purchase, applicants apply for a job, or investors buy your company’s stock.

For instance, Moz claims that 67% of customers are influenced by online reviews. Glassdoor states that a strong employer brand can reduce the cost per hire by as much as 50%. And Weber Shandwick found that reputation accounts for 63% of a company’s market value.

Digital marketing improves brand sentiment in a number of ways. It engages potential customers across social media networks to reinforce your company values. It expands your audience reach through content distribution. And, most importantly, it uses SEO to influence which content is visible in Google Search.

In fact, a commissioned study by Forrester Consulting found that 70% of executives believe SEO improves brand perception.

Forrester Study – SEO Paradigm ShiftAccelerate growth and protect your brand with fully integrated SEO.Download the Study

Digital marketing reduces customer acquisition cost (CAC)

Advertising is about paying someone to deliver your content to their audience. Traditional ads factor in time and location. For example, you pay to run a TV spot during a certain program. Or, you pay to display a billboard from November through December.

That means you pay for the ad even if your audience doesn’t see it.

Digital advertising, on the other hand, lets you show your ad to a specific audience and only pay when someone clicks on it. It sounds like a marketing utopia, right?

But, as an informed marketing executive, you probably already know that programmatic digital advertising has lost its luster.

The combination of anemic click-through rates, rampant fraud, and inaccurate data drives advertising CAC through the roof. The problem has gotten so bad that many notable brands turned off hundreds of millions of dollars in digital advertising spend and saw no revenue declines.

Organic search promises much more sustainable, compounding results.

Through search engine optimization, Terakeet reduces CAC by an average of 87.41% compared to paid advertising. That cost reduction means we’re able to deliver up to a 12.2x ROI on marketing spend.

87.41%

Terakeet reduces customer acquisition costs by an average of 87.41% compared to paid ads

Terakeet

Organic search has such a low CAC because after you gain traction, your content performs even when you shift your budget elsewhere. That’s the power of SEO.

Digital marketing increases customer loyalty

neon sign that spells love

Most new marketing strategists tend to view digital media through the lens of infographics, templates, or social media posts to share on LinkedIn or Twitter. But, those are just tactics — fancy lures to get some attention. They don’t engender a sense of loyalty, let alone foster meaningful connections.

However, brands that truly understand digital marketing learn to leverage it to build entire communities.

These communities develop into echo chambers of brand love where users interact with each other as well as the brand. As a result, marketing professionals gain access to the hearts and minds of their audiences.

They can extract insights to drive marketing initiatives, encourage dialogue, and amplify loyalty in ways that a direct mailer or email never could.

Digital marketing drives revenue

Marketing ROI isn’t always straightforward to measure. But, at some point, you will need to ring the cash register. And digital marketing is phenomenal at driving revenue because it’s incredibly versatile, agile, and user-focused.

In fact, Here’s what the CMO Council says:

87% of B2B buyers say online content has a major or moderate impact on vendor selection.

But, what about the impact for B2C companies?

Terakeet helped an online bank increase monthly organic account enrollments by 553% through SEO. Sure, we also increased monthly organic search traffic by close to 700K during that time. But, what matters most to the business is revenue. And the more accounts they secure, the higher their revenue.

Primary types of digital marketing

colorful plastic dinosaurs to represent different types of digital marketing

Although there are dozens of different types of digital marketing, I’ll focus on the most impactful strategies for this guide.

Search engine optimization (SEO)

SEO is the king of inbound marketing. A holistic SEO strategy helps businesses capture non-paid search traffic from relevant, interested audiences at an incredible ROI.

SEO is special because it’s the one digital marketing vehicle with the deepest insight into your audience’s mindset. SEO reveals their thought processes and unlocks meaningful connections. It’s the keystone of your digital marketing process that amplifies and unifies all of your marketing and digital channels.

Beyond that, it’s hard to beat the ROI of SEO.

Terakeet’s partnership with a leading mortgage company earned us a 2021 Titan Business Award and led to the following results:

265%

Grew Google organic market share by 265%

Terakeet
12.2x

Delivered 12.2x return on investment

Terakeet
429%

Grew business value per blog visit by 429%

Terakeet

Read the full case study.

Today, the organic search channel is more central to any business’ performance. CEOs frequently discuss their SEO strategy during quarterly earnings calls, and they understand how organic search impacts the business overall.

For example, Cars.com often points to their domination of the search engine results pages (SERPs) as a reason for increased leads and financial results when talking with investors.

Enterprise SEO PlaybookBuild a more efficient SEO strategy and leave your competitors in the dust.Download the Study

Content strategy & content marketing

Content strategy is the high-level plan for reaching your audience through content. And content marketing is your step-by-step roadmap for distributing that content through your digital marketing efforts.

As you might expect, there are dozens of different types of content marketing you can deploy to reach potential customers. The format you choose depends upon which platform you plan to publish on, the purpose of your content, marketing timelines, and so much more.

Most brands understand the benefits of content marketing by now, which include:

  • Connecting with your audience
  • Delivering a captivating user experience
  • Projecting your brand personality
  • Driving engagement
  • Influencing perception
  • Increasing online sharing
  • Generating conversions

As you can see, content marketing extends far beyond blog posts.

You could produce case studies to boost customer acquisition. Or, you might create more engaging product videos to increase ecommerce sales. You could also develop a content hub that’s filled with expert guides, white papers and reports.

There are practically limitless content marketing examples brands can use to bolster their digital marketing efforts.

Social media marketing

Statista reports that by 2022, brands are expected to spend more than 56 billion dollars on social media advertising. And that figure doesn’t even account for the cost of managing social media teams to organically engage with audiences.

Social network advertising spending in the United States

Most of that massive budget is expected to have a positive return on ad spend (ROAS) through purchases. But, some of it is allocated to growing brand awareness through audience targeting.

Stop for a moment.

That should raise a big flag if you remember how inaccurate user targeting data is on social media.

Instead, brands should leverage social media marketing for its power to organically engage with audiences.

  • Create content that triggers emotions, draws in users, sparks virality, encourages conversation, and gives folks a reason to click the follow button.
  • Tap into your audience’s passions and implement a feedback loop with the broader marketing team to develop, iterate on, and amplify other marketing initiatives.

Digital advertising (PPC)

digital ads are like casinos

Digital advertising is a broad field that commands a humongous slice of the marketing budget. Among the many different types of digital advertising, the most prominent are: display, social media, native, video, and paid search.

Let’s walk through each one quickly.

Display advertising

Display ads perform the worst. They have an abysmal click-through rate (CTR) as low as 0.35%, and most of those clicks are due to accidents and bots. Most internet users have developed banner blindness, and they completely ignore display advertising.

Display ads are like the billboards of digital advertising. They float invisibly in the background while users subconsciously ignore them.

Social media advertising

Social media advertising, as we already discussed, is riddled with accuracy issues that will only get worse as privacy laws, ad-blocking technology, and consumer awareness increase.

Native advertising

Native advertising (a paid promotional placement within content) can be effective if it’s high quality. However, most attempts miss the mark or get buried in the murky quagmires of classified sections on websites.

Video advertising

Video ads — in this case I mean ads that play during video streams such as YouTube — are incredibly disruptive to the user experience. Think about it, how often do you hover your finger over the skip button on YouTube? And how many times have you intentionally clicked on a YouTube ad?

Marketers often argue that these ads impact brand awareness. But, when they frustrate users, is that really the type of awareness you want to drive?

Search engine advertising

That brings us to paid search advertising.

Google Adwords is the most reliable form of digital advertising because it leverages user search behavior. In other words, rather than targeting a 30-year-old male during the winter, you could show your ad to people who search “best downhill skis”. In that case, it doesn’t matter who you target. All that matters is what they want.

As more brands accept the reality that the pandemic jolted consumer shopping behavior into the digital age, they’ll shift more of their marketing budgets into paid search. In fact, eMarketer expects advertisers will spend $99.22 billion on search by 2024. That exceeds their pre-pandemic forecast, accounting for the shift in shopping behavior.

$99.22 Billion

Advertisers will spend $99.22 billion on search by 2024

eMarketer

So, what’s the problem with paid search ads? Several things, actually.

Firstly, although paid ads deliver quick, short-term sales, they’re not a sustainable revenue stream for online marketing. As soon as you turn them off, your visibility vanishes.

Secondly, search ads are expensive. In general, the ROI on a PPC campaign is about 2x vs a 5x return on SEO. In contrast, Terakeet delivers an ROI as high as 12.2x, and acquires customers for 87.41% less than paid ads.

So, although paid search certainly has its place in a comprehensive digital marketing plan, it is often most profitably used in a highly targeted manner or for a short-term campaign.

Email marketing

email marketing

Email marketing might feel like a relic compared to other digital strategies, but it’s alive and thriving. In fact, email marketing generates $38 for every $1 spent, which means it produces the highest ROI of practically every other digital marketing channel.

On the B2B side of things, email is the top source for B2B leads and has the highest return on investment (ROI), according to Chief Marketer’s 2020 B2B Marketing Outlook Survey.

The digital marketing success of email is no surprise because it’s much easier to mobilize existing fans than to capture new customers. Furthermore, it’s incredibly scalable when powered by marketing automation tools. A single digital marketing specialist can effectively manage multiple campaigns simultaneously.

Email marketing provides your brand a one-to-one channel with your audience. Through effective audience segmentation, you can control the messaging that reaches each buyer persona consistently while ensuring its relevance.

While awareness-driven strategies at the top of the funnel are critical to your business’s success, don’t neglect the low-hanging fruit of email marketing.

Native advertising

Native advertising matches the form and function of the platform on which it appears. While that’s a very broad definition, most people use the term to discuss sponsored in-line content, feed-based social media ads, and video-based YouTube ads.

In this way, they do not appear as an “intrusion” on the content being viewed, like, say a display ad might be interpreted, because they take the exact form of the other content on the page. It just so happens to be paid content instead of organic. 

Some digital marketers use native ads because they capture attention more than banner ads while targeting an audience with 18% better purchase intent.

Native advertising may be effective for certain brands as part of the digital marketing mix. The key is to test it across different platforms to see which works optimally with your audience.

Affiliate marketing

man on blue couch holding up a glass to celebrate his affiliate marketing revenue

Affiliate marketing is the process of paying a commission to bloggers, social media influencers, and other affiliates who bring paying customers to your business. Similar to PPC, you only pay your affiliate marketers when a sale can be attributed directly to their referral.

For many businesses, this makes it a win-win. Best case scenario, affiliate marketing drives tons of potential customers to your product landing pages where they convert. Worst case scenario, you get no referrals and you pay nothing.

As a digital marketer, there are a few downsides you should be aware of. Firstly, affiliate marketers that run spammy, link-riddled blogs can do your reputation more harm than good. Secondly, heavy affiliate commissions could erode your bottom line.

Before you run a digital marketing campaign with affiliates, do the math and make sure it will support your marketing objectives. Then, be picky about who you work with. Some brands find that it makes the most financial sense to work exclusively with super affiliates.

Affiliate relationships can be a powerful digital marketing asset to cultivate. They’re effective brand ambassadors that could convince a potential customer to choose you over your competitors.

A brief recap

As you build out your digital marketing strategy, keep in mind the pros and cons for each channel. Nothing is perfect, so it’s critical to mix the right recipe to achieve your business goals.

For example, you can run Google Adwords when you need to target short-term seasonal keywords or while you’re building up topical authority to rank in organic search. Once your content ranks in the top three organic positions, you can shift PPC budget to other keywords.

Use social media to amplify your blog content, have conversations with your audience, and uncover trending topics they care about.

Leverage email marketing to nurture leads, amplify loyalty, prompt action, and promote your content.

Finally, integrate your traditional marketing efforts with your digital initiatives too. There are plenty of ways to use QR codes, custom URLs, and hashtags in direct mailers and in-store signage to more effectively track customer behavior across mediums.

The key to success is to view online marketing as part of your overall digital transformation rather than a separate entity.

Our digital marketing trends infographic showcases the most important statistics you need to know right now.

digital marketing trends infographic

Digital marketing FAQs

What is digital marketing?

Digital marketing is a subset of marketing that leverages technology, the internet, and electronic devices to promote products and services and engage with consumers.

What are the main types of digital marketing?

Some of the most common types of digital marketing include SEO, content marketing, email marketing, social media marketing, digital advertising, affiliate marketing, and native advertising.