Borrell’s DMRs are a refreshing change

Borrell Associates announced its innovative Digital Marketing Regions (DMRs) last week, a move designed to give local digital media and digital marketers an organized and sensible area within which to ply their trades. Long overdue, it’s a practical solution to defining areas of influence that plays much better with the more precise targeting available via the Web. Instead of using television’s 210 DMAs (Designated Market Areas), for example, the Borrell DMRs offers 513 slices of the digital pie.

Local advertising is sold, not bought, and this should help local sales by injecting more precision — and eliminating some of the guessing and waste — into local or hyperlocal ad deals. Some people want to touch as broad an area as possible, but that makes no sense at all to others. I’ve spent a lot of time in hyphenated television markets where certain ad rates couldn’t be justified to merchants who only cared about one community or the other. DMRs are designed, in part, to overcome that.

Borrell Associates has given both buyers and sellers a whole new frame of reference for today’s digital world, and I think it’s a very big deal. I caught up with Gordon Borrell via email to find out how people are reacting.

Gordon BorrellHow do mainstream media companies view this? I can’t imagine they’re really happy, especially where you’ve actually carved up their territory.

Depends on who’s viewing it. If it’s a mainstream media company that manages its digital ventures solely through the lens of their core product, they’re going to always look for gold in the shadow of that umbrella. If it’s a mainstream media company that understands the new medium as more than just a digital product extension, they’ll embrace the DMR concept. Neither way is bad, by the way. It’s just a choice that a media company makes. TV stations or newspapers won’t be doomed if they think of online media only as a way to extend their deadlines and sell a little more advertising to their current customers.

Who benefits the most from this innovation and why?

It’s just another piece to the digital puzzle, so anyone who’s earnestly trying to figure out the big opportunity will have another jigsaw piece to work with. They benefit from being able to have a more realistic, manageable marketplace geography to work with. The biggest advantage is that now, for the first time, we can gauge the size of the market opportunity for any one media company. Most people are shooting for incremental growth over last year. If you look at the DMR and know what your share SHOULD be, you might start shooting for 100% or 200% growth. And given the right resources, you’re likely to get it.

Have you had discussions with reach measurement companies to adapt your new schema?

No. They gauge traffic, and oddly enough traffic doesn’t relate that much to digital advertising. I know of a site that gets less than 30,000 monthly unique visitors and is making about $4 million, and in that very same market there’s a site that gets about 2 million uniques and makes about $5 million. It’s not the massive audience that advertisers want on the Internet. It’s a specific audience. There’s riches in niches.

What’s the reaction been? Any surprises for you?

Very, very good. Lots of “it’s about time!” and “we REALLY needed this!” type of messages. A few sharp people have pointed out market definitions that we’ll have to revisit — which is what we really want. It’s hard to know consumer and advertiser patterns for every single one of the 513 markets. So this type of feedback is most valuable to us. We’ll likely reconfigure about 5% of the markets based on the feedback, after we investigate spending patterns further.

In today’s ever-changing digital world, the need for traditional sales infrastructures to evolve has never been greater. I view the creation of these DMRs as a vital and necessary transition that will serve everybody involved in digital media and especially digital sales for a long time. I suspect, however, that this is just the beginning, for even the very definition of “local” is changing. We’re simply too hyperconnected these days. Miles mean nothing in the network. The idea of local shopping — for certain things, especially perishables — isn’t ever going to go away, but companies like Amazon and E‑Bay are making it harder and harder to sustain margins in other “local” shopping worlds.

As Michael Powell said in 2004, we’re in the midst of “the greatest paradigm change in the history of communications, and it will change things forever.”