Digital Marketing: What Is It and Why Do You Need It?

Digital marketing what is the primary question many traditional business owners ask when they see shifts in consumer behavior and advertising spend. At its core, this practice involves the use of the internet, mobile devices, social media, search engines, and other digital channels to reach consumers. Unlike traditional methods such as billboards or newspaper ads, these digital strategies allow for direct interaction and precise data collection. Understanding the shift toward online channels involves looking at where consumers spend their time and how they make purchasing decisions.

Defining the Scope of Digital Marketing

Digital marketing serves as an umbrella term for various online tactics used to connect with an audience. It encompasses several distinct branches, each serving a specific function in a business strategy.

Search Engine Optimization (SEO)

SEO is the process of improving a website to increase its visibility when people search for products or services related to a business in Google and other search engines. Data from StatCounter indicates that Google accounts for over 93.9% of global mobile search market share as of early 2025. Higher visibility in search results leads to more attention and attracts prospective and existing customers to a business.

Pay-Per-Click Advertising (PPC)

PPC is a model of internet marketing in which advertisers pay a fee each time one of their ads is clicked. Essentially, it is a way of buying visits to a site rather than attempting to earn those visits organically. Search advertising remains a significant segment of the market, with projections from Oberlo suggesting expenditures will exceed $306 billion annually.

Social Media and Content Marketing

These methods involve creating and sharing online material—such as videos, blogs, and social media posts—that does not explicitly promote a brand but is intended to stimulate interest in its products or services. According to HubSpot’s State of Marketing Report 2025, social media platforms are expected to host over 5 billion users globally, making these channels primary points for brand discovery.

The Financial Shift from Traditional to Digital

Traditional business models often rely on physical proximity or broadcast media to generate leads. However, global advertising trends show a decisive move toward digital investment. Marketers spent approximately $1.1 trillion on advertisements in 2024, with digital channels accounting for 72.7% of that total investment.

Digital ad spend is forecast to reach nearly $800 billion by 2025. This growth occurs because digital platforms provide businesses with the ability to scale campaigns based on performance. Traditional marketing generates approximately 50% fewer interactions with customers than digital marketing, according to data from Digital Third Coast. While a television ad or a print brochure reaches a broad audience, digital tools allow for the exclusion of individuals who do not fit the target customer profile, reducing wasted spend.

How Consumer Behavior Dictates Marketing Needs

The primary reason businesses require an online presence is that the modern buyer journey starts with a digital search. Research from SOCi reveals that 80% of U.S. consumers search for local businesses online at least once per week, while 32% do so daily. If a business does not appear in these searches, it remains invisible to a significant portion of its local market.

The Role of Online Presence in Local Discovery

A business’s digital footprint serves as a trust signal. Roughly 97% of users check a business’s online presence before deciding to visit a physical location. This research often includes checking opening hours, location, and service availability. BrightLocal reports that 62% of consumers avoid businesses if they encounter inaccurate information online, such as an incorrect phone number or outdated address.

The Impact of Mobile Accessibility

Mobile devices drive the majority of web traffic. HubSpot reports that 63% of consumers prefer to find information about brands and products on mobile devices. When a consumer performs a "near me" search on a smartphone, the intent is often immediate. Approximately 76% of people who search for something nearby on a smartphone visit a related business within a day. Of those visits, 28% result in a purchase.

Measurability and Data-Driven Decisions

One of the most significant differences between online and offline marketing is the ability to track results with certainty. Traditional marketing often relies on estimates, such as "reach" or "impressions," which do not always correlate with sales. Digital marketing provides specific metrics that reveal exactly how a campaign performs.

Real-Time Performance Tracking

Tools such as Google Analytics and social media insights allow business owners to see how many people viewed an ad, how many clicked it, and how many of those clicks resulted in a sale. This transparency enables the adjustment of strategies within hours rather than waiting for the end of a monthly print cycle.

Return on Investment (ROI) Metrics

Specific digital channels offer high returns for every dollar spent. For instance, PPC advertising returns an average of $2 for every $1 spent, according to WordStream. Email marketing remains even more cost-effective, with some industry data suggesting returns between $36 and $40 for every $1 invested. These figures provide a clear financial justification for shifting budgets from traditional to digital channels.

Building Trust Through Online Reputation

In the past, word-of-mouth was the primary driver of reputation. Today, that word-of-mouth has moved to online review platforms. Consumers no longer rely solely on what a business says about itself; they look at what other customers have experienced.

Nearly 9 in 10 consumers regularly read online reviews before making a purchase decision. Furthermore, 77% of consumers state that a business must have at least a three-star rating to be considered. Managing an online reputation involves responding to feedback and ensuring that the business is represented fairly across platforms like Google Maps, Yelp, and Facebook. Engaging with reviews demonstrates that a business is active and cares about customer satisfaction.

Reaching a Specific Audience with Precision

Traditional advertising is often described as a "spray and pray" method, where a message is sent to a large group in the hope that a small percentage will be interested. Digital marketing operates with surgical precision.

Demographic and Behavioral Targeting

Platforms like Facebook and LinkedIn allow businesses to target users based on specific criteria. This includes age, location, job title, interests, and even recent purchasing behavior. A local landscaping company can choose to show ads only to homeowners within a ten-mile radius who have expressed interest in home improvement. This level of targeting ensures that the marketing budget is spent only on the most likely prospects.

Retargeting Strategies

Digital marketing allows for "retargeting," which involves showing ads to people who have already visited a website or interacted with a social media post. Since most consumers do not buy on their first visit, staying visible to these individuals increases the likelihood of an eventual sale. Statistics indicate that customers are up to 70% more likely to purchase a product when retargeted with display ads.

The Flexibility of Digital Strategies

Traditional marketing campaigns are often rigid. Once a billboard is printed or a magazine ad is published, the content cannot be changed without significant expense. Digital marketing offers unmatched flexibility.

If an ad is not performing well, a business owner can change the text, the image, or the target audience instantly. This ability to pivot prevents long-term losses on ineffective strategies. Small businesses, in particular, benefit from this agility, as they can test different messages with small budgets before committing to a larger campaign.

The integration of video content has also become a standard requirement. Wyzowl reports that 91% of businesses used video as a marketing tool in 2023, with 93% of those marketers reporting a positive ROI. High-quality video content can be produced and distributed through digital channels at a fraction of the cost of traditional television production.

Competing with Larger Entities

Digital marketing levels the playing field for small and medium-sized businesses. In the traditional world, a small shop could never compete with the advertising budget of a national corporation. On the internet, however, a well-optimized website and a targeted local SEO strategy can place a small business at the top of search results alongside major brands.

By focusing on niche keywords and local intent, smaller businesses capture traffic that larger corporations might overlook. The focus shifts from who has the biggest budget to who provides the most relevant answer to the consumer’s query.

As the digital landscape evolves, the question is no longer whether a business should be online, but how effectively it can utilize these channels to meet consumer expectations. The transition from traditional to digital is a direct response to a world where the majority of the population carries a gateway to the global marketplace in their pocket.