As digital ad costs surge by 43% year-on-year, South African businesses are facing a troubling reality: increased spending on social media advertising is delivering diminishing returns. In this challenging landscape, TDMC (The Digital Media Collective) Media Director, Caleb Shepard, warns that most companies are making fundamental mistakes that prevent sustainable growth.
We're seeing businesses burn through marketing budgets without addressing the real barriers to scaling.
Increased digital noise, category competition and dynamism in the e-commerce space mean that without ongoing and robust learning and understanding of ever-changing trends, algorithms and platform shifts, it's virtually impossible to stay ahead of the curve.
Here are the critical questions business owners must confront to diagnose their digital stagnation:
Before kicking off with the checklist, it's imperative that businesses understand that marketing spend and sales spend should be treated as two fundamentally separate budgets with different objectives. The first should be to build the brand, the other to sell product. Understanding and embracing this is essential if you are to succeed.
Key Challenges in Digital Marketing Scaling
1. Funnel Fundamentals
Are you focusing only on immediate sales while neglecting brand awareness?
Many businesses fall into the trap of focusing exclusively on bottom-funnel activities. If your social is only playing in the bottom of the funnel — the conversion stage, where customers are ready to purchase — it doesn't matter how much you spend, your scaling is unsustainable.
Businesses chasing immediate returns without building the foundation that supports long-term growth are at risk, and understanding that different channels reach different audience segments is fundamental. Looking at ads in isolation rather than as part of an integrated strategy is a common mistake that prevents scaling.
2. Technical Barriers to Conversion
Is your website experience undermining your advertising investment?
Data shows that users abandon sites that take longer than three seconds to load, creating a significant barrier to conversion. You can have the perfect ad creative, but if you're sending traffic to a less-than-stellar landing page experience, your conversion rates will suffer tremendously. If your conversion rates have gone backwards while your ad spend increases, it's time for an honest technical audit.
Our most successful clients obsess over their site performance metrics, and we continuously work on optimising their landing page experience.
3. Content and Messaging Misalignment
Has your brand lost its narrative in pursuit of quick conversions?
We're seeing a concerning trend where businesses are losing the art of storytelling — the need for a compelling narrative has never been more important. In a crowded marketplace, your story is often the only thing that differentiates you from competitors with similar products and pricing.
Be cautious, a single perfect ad will not solve all growth challenges. If ads aren't scaling, most businesses immediately start testing copy and ad visuals — but that's often addressing symptoms rather than causes. Working on your narrative should be an ongoing priority.
4. Budget Allocation Imbalance
Are you sacrificing long-term brand value for short-term sales spikes?
The most successful businesses follow what I call "the golden ratio of marketing effectiveness". Research across hundreds of campaigns shows that the optimal balance is approximately 60% brand building and 40% sales activation.
This 60 / 40 split has been proven repeatedly across industries and market sizes. Yet most South African SMEs we encounter are investing over 90% in direct response and virtually nothing in building brand equity. This imbalance is perhaps the single biggest barrier to sustainable growth.
The data is compelling: businesses that maintain this balanced approach see conversion rates improve by up to 2.8 times compared to those focusing primarily on performance marketing. Every rand spent on brand building makes your performance marketing more efficient. It's not either / or — it's both, in the right proportion.
5. Neglected Channels and Opportunities
Are you ignoring proven channels while chasing the latest platform trends?
Unevolved or underdeveloped email marketing strategies are a missed marketing opportunity. Often neglected as a channel despite being an enormous contributor to overall sales, email marketing should be viewed as crucial. An abandoned cart email isn't enough anymore. The businesses that excel are implementing customised email messaging that builds relationships over time — our teams are constantly working on customised email threads to meet customers where they are in their journey.
The Path Forward: Sustainable Scaling Strategies
Shepard's five key recommendations for sustainable growth:
- Understand Your Customer Journey: At its core, we're in a human behavioural science business. Every business on the street is trying to propose before the first date. You need to date your customer before asking them to commit.
- Recognise Channel Differences: The person engaging with your organic content is in a different mindset than someone clicking your paid ad or reading your email.
- Balance Marketing Investments: Implement the proven 60 / 40 split between brand building and activation. This ratio has been validated across industries and market sizes.
- Return to Marketing Fundamentals: Product, price, place, promotion — these classic principles still determine success regardless of how sophisticated your ad targeting becomes.
- Upskill Your Team: The platforms and algorithms change constantly, but the principles of effective marketing remain surprisingly consistent.
Not everyone is an expert, so calling in those who are to fulfil crucial marketing fundamentals is often key to a business's success. We see it time and time again with our clients. When they are able to focus on what they are excellent at by leaving us to flex our expertise in the paid media space, sustainable growth and scaling start to happen.
For more information, visit www.tdmc.co.za. You can also follow TDMC on Facebook, LinkedIn, X, or on Instagram.
*Image courtesy of contributor