Traditional vs New Age Advertising Media Models

By Guest BloggerNov 09, 2012

Dave Crader explains the differences between paid vs owned vs earned media and the evolution of advertising over time. He'll be discussing the advertising working dollar and the non-working dollar and the ways these two spends can be interpreted differently in today's advertising. By the end of this blog you'll learn the importance of earned media and how it can be achieved through services like website development, SEO and social media marketing.

Hi.  I'm Dave Crader. Today we'll be going over the differences between the traditional media model and the new age media model, and how things have changed over time.  We'll be discussing the working dollar and non-working dollar, and the paid, owned, and earned media.

To start, I'll be going over the traditional media model.  About 30 to 40 years ago, there were typically two different types of advertising dollars, the working dollar and the non-working dollar.  Many companies prefer to spend a majority of their budget on the working dollar simply because they get more impressions for their ad.  The advertising agencies typically only got about 20% of the advertising budget because companies thought the advertising agencies wouldn't be able to provide them with more impressions and more people seeing their ad.  And before the Internet, that made a lot of sense.  That's the way it was.  But now with the Internet, advertising agencies, like Evolve, can provide both the working dollar and the non-working dollar through things like website development, SEO, and social media marketing.  I'll be explaining how that's possible with the new age media model.

Nowadays, the media model can be divided into three categories, paid, owned, and earned media.  Paid media is the one you are probably most familiar with, things like TV commercials, radio commercials. It can also be things like Google AdWords, or Facebook advertising.  It's probably the least credible.  People are smartening up to advertising and they know when you're paying to get your message across.  No one really likes that.  I don't know many people that enjoy advertising.  So, the paid media has its place, but it's definitely the least credible because you're not earning that space.  You're not earning that message.

Now you also have things like owned media.  This is simply things like branded keywords, like, someone types in your company name, Evolve Creative Group, into a search engine and they find our website, that would be an owned media type of traffic.  You also have people coming to your website just typing it into the address bar. Maybe, franchises that could also be a type of owned media.

We also have earned media.  This is probably the newest one to you and something you're probably not too familiar with.  This could be coming from channels that you do not control.  So, for example, let's say you make a blog post on your blog and someone shares that blog post on Facebook.  Someone else sees that their friend shared this post, and then they go to your website to check it out.  That's going to be a type of earned media.  They know you didn't pay for that.  They just saw their friend share it.  So, since their friend recommended it, they now think your company is credible and they check out your website and read more about it.  That's just one example.  Someone could leave a review of your website on maybe, "", and come to your website that way.  They know you didn't pay for that review.  That would be highly unethical.  So that's another type of earned media.  So this is coming from channels you do not control.  So therefore it is the most credible and most effective type of advertising there is today.

The hurdle that many companies face is this 80 to 20% ratio.  They can't get it out of their heads that, "I need to spend all of my money to these media providers so that I can get more impressions for my brand".  It just doesn't work that way anymore.  Now, with online marketing agencies, like Evolve, you can spend 80% of your budget on earned media.  And you can have that advertising money work for you for years.  So, the profits can just keep coming in year after year, when you're done paying for it.  You spend all your 80% up here at the paid media, when it's done, it's done.  It's not an investment.  This is an investment in your business.  It's not going to stop working for you.  People are going to share it, it's going to be more credible, and it's going to be more effective.

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