Why the Annual Planning Process is Behind Before it Starts Street Fight

Why the Annual Planning Process is Behind Before it Starts

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From advancements in campaign measurement to performance and optimization, the digital advertising industry has consolidated decades worth of transformation to a matter of years. And while the pace of advertising investments has shifted and performance data becomes available more regularly across channels, the annual planning process for all media expenditures has remained, well, annual. In order for planning to provide strategic value and return on ad spend in today’s dynamic landscape, annual planning must account for the evolving digital and traditional buying cycles. What might this look like, and how do we get there?

How the annual planning process began

Media buying as it began was a much less fluid concept dictated by traditional TV, providing a limited amount of feedback data and on a significantly delayed basis. With the developing technology, marketers’ media mix was not as diverse as it is today. Once advertising budgets were finalized, planners poured dollars into big media channel-based buckets with lids given the limitations on performance data. This led to a highly siloed system (think various Excel sheets) and resulted in bespoke processes with multiple steps, based more in art than science. Given the nature of traditional TV, the collaboration capabilities between planners, agencies, vendors, and partners did not exist as it does today.

Why it’s not living up to the state of the industry 

Much like the rest of the digital advertising industry, consumer viewership has transformed over the last few years. As content preferences shift towards streaming and connected TV (CTV), naturally, dollars have followed – and we’ve since seen rapid advancement and innovation when it comes to measurement and performance data for TV as marketers seek to prove the impact of their investments in this growing environment. Worth noting, these advancements haven’t only enhanced CTV environments. They’ve benefitted linear TV, too – creating synergies between platforms and channels that make it easier to understand the holistic impact of marketer advertising efforts.

As a result of these innovations, optimization has become a core component of all advertising initiatives—and thankfully, tools have evolved from the one-off Excel sheets of the past. But while ad dollars are shifting to maximize performance and outcomes, both traditional and digital metrics have become fragmented, leading to optimization efforts that occur in siloes.  And, in tandem, annual budgets have remained stagnant – creating a disconnect between media planning and optimization. What once was a useful tool used to map advertising spend, has become a suboptimal representation of reality – leading to less effective media buying and future investments.

What needs to happen to get it there?

While these new and improved insights can be used to analyze performance and shift investments to maximize results, the optimization process remains reactive – and we shouldn’t stop there. The industry has a massive opportunity to go beyond optimization by tapping into the transformation of predictive technologies, making more intelligent media investment decisions as a result.

At a holistic level, the digital advertising ecosystem is at a critical turning point – and with worldwide digital ad spend continuously on the rise, the ability to proactively understand and accurately allocate media investments across all mediums is crucial.

While we can’t expect the annual planning process to dissipate entirely, its purpose must evolve from a “set it and forget it” resource. In order to effectively drive ROI across all channels and platforms, the annual media plan must become a fluid source of truth – rooted in data and technology – that withstands the pace of investment allocation and optimization that exists today.

Scott Knoll is the Founder and CEO of Guideline. Guideline is the world's most trusted authority for accurate media data and collaborative planning tools to guide your advertising decisions.
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