Tag Archives: Advertising

Better Ways for Marketing People to Get Paid

As Tim Williams, author of TAKE A STAND FOR YOUR BRAND explains on this week’s episode of BRANDING BUSINESS (hosted by Ryan Rieches of OC’s biggest branding firm RiechesBaird here on www.OCTalkRadio.net), “for people who are supposedly creative, we don’t spend much time considering alternative ways to get paid beyond some hourly rate….as if creative work and manual labor were somehow both the same”.

Hear his ideas on alternative ways in which ad agencies, marketing people and other creative talent can get paid that more closely matches their corporate contribution and the true value of their work.  Definitely a conversation starter.

How to you pay for creative ideas in your company?

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Why the QR code is Failing (and How To Fix It)

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Courtesy of Sean X. Cummings and iMediaConnection.

They have become the standard violator appearing on advertising; in the corner of print ads, across billboards, on buses, or in pieces of direct mail — even peppered throughout this article. You’ve seen them; that little block of even littler squares. Unfortunately the technology behind QR codes was not invented for advertising and marketing; we are just co-opting its usage, and it shows.

From the relative lack of public understanding of what they even are, to the dearth of creativity in their usage, the QR code is destined to become just the little box that geek built. But if it does go the way of CueCat, only we are to blame. Here’s why.

The current use of QR codes in advertising is…
I could finish that statement with “stupid,” “useless,” “uncreative,” or “uninspiring.” Surprisingly, that is not news to anyone at advertising agencies or brands. QR codes seem to be a last ditch effort; an ignored piece of “Hey, throw a QR code on there that leads to our website.” But why bother? The general public seems largely oblivious to what they are used for, and why they are on all those ads. In my informal “on the street” survey of 300 people last month, I held up a sign with a QR code on it and the phrase: “Free gift if you can tell me what this is.”

I was not asking them to decipher it, just tell me what it actually was. Here are the results:

  • 11 percent correctly answered QR code or quick response code
  • 29 percent responded with “Some barcode thingy”
  • Seven percent guessed some variant of “Those things you stare at that get 3D when you cross your eyes. What picture is it? I can’t seem to get it”
  • The remaining 53 percent tried everything from a secret military code, Korean (uh really?), to an aerial street map of San Francisco

My survey was conducted in San Francisco, the veritable Mecca of the planet for tech, so it only goes downhill from here. When I asked those who knew it was some type of “barcode” how they could decipher it, 35 percent answered “with their phone.” When I asked them to actually “read” it with their phone? Only 45 percent of those were able to do it, and it took an average of 47 seconds for them to take out their phone and find the application to read the QR code — not exactly a “quick response.” Remember that agencies are putting these on moving buses and highway billboards.

To read the rest of the article, CLICK HERE.

A Simple Guide to Ad Exchanges

Courtesy of iMediaConnection

More and more online display inventory is being purchased via ad exchanges than ever before. On these platforms, advertisers utilize technology to bid on each and every ad impression in a real-time marketplace based on the value they put on the viewer. For example, retargeting has become a popular tactic as advertisers are able to tag (and then buy ads exposed to) users who have already shown interest in them by visiting their site. This technique has proven to be very effective, with higher than normal click-through rates (CTR), conversion rates, and other key performance indicators (KPIs).

Currently, more than 400 billion global monthly impressions are up for bid to online marketers — that translates to about 150,000 ads each second during high internet traffic times!

Tap into new digital knowledge. Want to stay on top of the latest developments in using ad exchanges? Attend ad:tech San Francisco, April 11-13. Learn more.

Since the first banner ad was sold more than a decade and a half ago, it’s no big surprise that publishers have aggressively sought ways to increase revenue by optimizing their ad inventory. Because so much of online inventory goes unsold or dropped into remnant channels for a micro-fraction of what can be made from presold, premium inventory, ad exchanges were an organic evolution in the ecosystem. A successful model was already in place with paid search where advertisers bid in a real-time, auction environment for ad impressions. As with paid search, exchange ad inventory is optimized by capitalist equilibrium — some inventory is worth pennies, some is worth tens of dollars. Either way, ad price is determined by what the market is willing to pay.

Because most of the transaction is automated by technology, exchanges are very efficient for publishers to monetize previously unsold inventory without the need for robust sales teams, as well as for advertisers to buy direct inventory without middle men (such as ad networks) inflating costs. This has led some industry experts to predict that the market share of exchange vs. traditional online display buying methods will grow quickly in the next several years. In fact, this may have set off a revolution in which we will see more and more inventory moved to digital channels — it might not be all available in real-time, but the efficiencies of this model cannot be denied. It’s very possible that one day that any inventory that can be sold this way, will be sold this way… not just online, but TV, print, radio, etc.

The debates of the value of audience vs. context, technology vs. manual expertise, commoditization of inventory and its effect on our industry, etc., are already taking place in board rooms, industry conferences, and the blogosphere. As exciting as the new opportunity might be, there is resistance from the owners of the status quo, who will find their importance and market share drastically reduced by this evolution. As well, there is concern about the quality of this inventory and, as is always the case when targeting individual users, there will be privacy issues to take into account.

Regardless of the positive and negative context surrounding ad exchange buying, there still exists some mystery into how the technology actually works. Below is a top-level overview on how a publisher impression gets passed through the exchange value chain and ultimately gets served as an ad to the end user.

Note: This entire process happens in less than one-third of a second.

The publisher
An online user makes it to a publisher’s site via a link or direct URL typed into a browser. The page loads and swoosh…

The publisher ad server
…the site’s ad server recognizes that an ad box is on the page that needs to be filled. Publishers have a variety of choices on where to buy inventory. They can have in-house sales teams that work to presell their best (premium) inventory, ad networks that agree to help sell the inventory (either on an exclusive or non-exclusive basis), and, of course, ad exchanges, where advertisers can bid, in real time, for the impression.

So the first-party ad server may put the ad impression up for bid on the exchanges directly or through…

The publisher’s tools
…which can enable them to let the impression be handled by yield optimizers (such as Rubicon, Admeld, and PubMatic) that can help them maximize their site revenue. They can consult with optimization service teams to help set pricing, decide what kind of ad units should go on specific pages, make deals with ad networks and exchanges, etc. As well, these partners can offer propriety technology to facilitate and optimize ad sales.

If the publisher tool decides at this time that the best value for the impression is on an exchange, it will send the impression there.

The exchanges
Currently, there are only a handful of “major” ad exchanges:
•AdBrite
•AdECN (Microsoft)
•ContextWeb
•DoubleClick Ad Exchange (Google)
•Right Media (Yahoo… currently testing real-time bidding)

These media entities have direct deals with publishers, networks, or publisher tools to sell inventory on their open platforms. On its DoubleClick Ad Exchange, for example, Google has migrated inventory from its very successful AdSense program, which enables it to sell advertising this way on literally billions of web pages. Exchanges negotiate rates with the media providers and get paid to simply handle the transaction.

Advertisers and their agencies can elect to “get a seat” on these exchanges in order to be involved in the bidding marketplace. Exchanges have self-service, back-end platforms that media buyers can log into, set up and manage campaigns, and run analytics reports to analyze and then optimize their accounts without ever talking to a sales person.

However, many advertisers elect to not work with exchanges directly, and opt to use a demand-side platform (DSP) as their trading desk of choice.

The 10 Minute Guide to Digital-Out-Of-Home (DOOH)

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Courtesy of IMediaConnection

So you think you know digital. But do you know digital out of home (DOOH)? Chances are that many of you are a little rusty on this segment of the industry. Several DOOH leaders told me that there is clearly a divide between those who know, understand, and utilize this space well, and those that don’t understand the space at all.

The number of people “in the know” is growing, but my suspicion is that there are plenty of iMedia Connection readers that would find an overview of this category valuable. Without further ado, here is a ten minute primer so that you can decide if DOOH might have value for you.

DOOH size and growth
No doubt about it, we all need to pay more attention to the size and growth of the DOOH segment of our industry. Take a look at these figures and think about them in the context of the size of the industry segments we talk endlessly about.

With greater than $3.5 billion in sales expected this year, it’s apparent that DOOH has a whole lot going on.

Category structure
Most industry observers break down the opportunities into four main buckets:

•Retail: The retail category encompasses in-store opportunities like PRN’s Walmart TV, grocery store checkout TV, and the like. The idea, of course, is to impact consumers at the point of sale. Sometimes these units work as broadcast screen only, while other units may offer deep interaction to help a consumer learn more about an item or choose the best product for them.

•Place-based: These screens appear in a variety of venues, particularly in captive audience environments where content can entertain consumers. Examples include in-taxi ads, ATMs, elevator screens, screens in bars/restaurants, and even in professional offices like dentists’ waiting rooms. Again, some work as broadcast units, other as interactive units.

•Outdoor: Think billboards, with sight and motion. You’ll typically find these in very high traffic areas like on main highways or places that attract millions of people, like Times Square.

Movie Theatres: Not the trailers, the ads that appear in the programming before a movie, or just before the coming attractions get started.

Targeting options
While many people think of out of home as a mass play, digital out of home has always offered a variety of targeting options from broad to highly defined population segments. Those options get better and more granular all the time. Some of the options available include:

  • Demographics: The broad range of DOOH venues makes it possible to deliver to a well defined demo. You can target by gender, age range, income, market, ethnicity, and more. While you are unlikely to get 100 percent composition, you can deliver a highly targeted campaign.
  • Venue: Naturally, there are a variety of venue targeting options. In-store vehicles let you reach consumers when they are most likely to be persuadable. Here there are options to target by class of trade (grocery, drug, mass, convenience store) or even by chain/chain and market. In-taxi media might be a powerful way for NY entertainment venues, for example, to drive awareness and purchase intent.
  • Location: This can range from a general location, like the Long Island suburbs, to a particular one, like medical offices. Additionally, digital outdoor also offers the option, pioneered by traditional OOH, of targeting by proximity, for example, within a certain number of miles from a Walmart.
  • Behavior/affinity: Adcentricity also reports that behavioral and insight targeting are also becoming much more common. Says their authoritative planning guide, “The practice of deep data based/rationalized targeting is growing daily to rationalize plans and justify solutions to the end client.” Interactive units surely play a key role in this regard.
  • Daypart: Many DOOH options offer the opportunity to schedule impressions and exposure by daypart. For example, a board might feature Minute Maid in the morning and MGD at night.

When to use DOOH
In order to best make use of DOOH, it’s important to think about it in the context of overall marketing objectives and tactics in use. In my view, DOOH should be thought of as part of an overall marketing solution — a supporting part.

I’ve put together six use cases that illustrate a broad range of situations in which DOOH can play an important role. Consider the following:

  • Mass reach: DOOH can be great at this. From digital boards at key locations on highways, to a broad scale buy at the entrances of retail stores, DOOH can hit tens of millions of people in a week or less. I think it’s best to think of this as supporting media in a mass reach effort, because the more passive nature of the broadly targeted units likely make them less effective at telling a complete product story. But in-store TV, for example, would be great at reminding consumers of a new product they’ve seen on TV, putting the item top of mind as the consumer wanders the aisles. Similarly, a digital billboard on the 405 in LA could remind millions of a TV premiere or the like.
  • Addressing underdelivery: DOOH is particularly good at reaching consumer groups that tend to be harder to pinpoint with traditional and PC-based digital media. For example, Toyota spent heavily to introduce its entry level Yaris car to young people through cinema advertising. The creative helped make the messages particularly resonant with the well defined audience segment.
  • Situational awareness: Imagine you are a tourist visiting New York City. You see an ad for Sweeney Todd on the In-taxi TV. Odds are that you are more likely to buy a ticket, no? Or how about this: You are waiting in a doctor’s office for an appointment to discuss joint pain. An ad for Celebrex appears on the screen in the lobby. Again, you’re a lot more likely to “ask your doctor about Celebrex.” Or how about this one: You work in an office building. It’s lunchtime. As you ride down the elevator, Subway’s “$5-dollar foot long” offer appears on the in elevator TV. You’re that much more likely to go get that big sandwich, yes?
  • Promotion delivery: You can make offers available to consumers through interactive units AND display units. For example, a billboard might offer a short code to download a coupon. Or an interactive unit might offer the option of a QR code to deliver an offer to a smart phone.
  • Real and symbolic brand support: In-store TV or kiosks will help drive more brand sales. But they also are very marketable to retailers that you are serious about the success of that item. That you’re committed to drive velocity. This might be a great alternative for premium priced brands to pursue versus circulars and end-cap discounting.
  • Product immersion: Interactive units, in retail or in captive locations, can give consumers an opportunity to “go deep” in product information. Imagine your cough medicine has eight formulations. An interactive display can help the consumer find exactly the right set of benefits for them.
  • Naturally, the opportunities and situations in which DOOH can help support your efforts are quite broad. The important thing is to consider DOOH as you consider all of your other media options, because it may well provide an edge.

    Media costs cover a broad range, with many broad vehicles offering CPMs similar to good online media, and more highly targeted tools charging significantly more for their precision.

    Creative considerations
    Digital out of home units tend to be rather “forefront.” They have the motion characteristics that demand consumer attention, and often appear in “captive venues” where there are few other distractions. Indeed, that is part of their power. I am sure some will take issue with this article for not vilifying certain DOOH vehicles as “over the line.” I’ll leave it to you to decide what’s OK and what isn’t.

    In an era of consumer empowerment, it’s important to think carefully about value exchange when you plan a DOOH effort. What information or entertainment value are you offering the consumer in exchange for their “captive attention?”

    In my view, there are two things to consider:

    1. What inherent value does the specific channel offer the consumer? For example, PRN and WalMart are careful to maintain a strong edit to ad ratio in Walmart TV. Ads surround strong content including home, lifestyle and entertainment stories. When the medium has value, consumers are willing to tolerate advertising to support it. It’s the classic US media model.
    2. What tangible value does you execution offer the consumer? DOOH experts may disagree with this, but I believe that the consumer should be able to expect more value from a more intrusive medium. The less value the medium offers, the more value your execution needs to offer in order to be received positively by the consumer. I’m not saying that it wouldn’t be effective to run a TV ad in an elevator, but rather that we are missing out on some of the promise of the medium by doing so. But at the same time, we need to consider cost/benefit of producing specific executions for media.

    Value can come in the form of information, lifestyle ideas, and entertainment. For example, that Toyota Yaris ad was clearly designed to reflect the high entertainment standards of the movie goer. No one wants to spend $8 to $12 to watch a “sale-a-bration” ad, but Toyota added value to the viewing experience with great action, storytelling, and production values.

    Interactivity is playing an increasingly significant role in DOOH. With the advent of larger displays, gesture control, multiuser touch screens, and other whiz bang technologies, consumers are getting more and more opportunities to become a part of the DOOH execution. Check out these two programs to get a sense of what I mean. The first is an InWindow Outdoor execution for PNC Bank.

    While historically these programs have been difficult to scale, that is slowly changing, and they continue to provide a create deal of buzz and news value when placed in the right locations.

    While such executions have their place in DOOH, many brands make the mistake of thinking about DOOH as “special occasion” media. As a result, they might consider a whiz bang program like this on rare occasions, but might overlook the work-a-day tools and tactics that are really driving the sales and growth in this industry. To think about DOOH solely in the context of these kinds of programs would be analogous to buying only site takeovers in online, without broad reach video, banners, or social programs to deliver a communications foundation.

    Conclusions
    Are DOOH media right for you? How the heck would I know? But it is safe to say that they warrant serious consideration by a larger number of brands. DOOH is growing like a weed because it is powerful, proven, and affordable. That’s a combination a lot of brands might find very valuable indeed. With expected sales this year of more than $3.5 billion, it’s quite possible that your competitors are already utilizing it to create competitive advantage.

    I’m indebted to two key sources of information and data for this piece:

    I hope this piece provided a useful overview for you to consider as you devise future strategies and tactical programs for your brand.

    Jim Nichols is senior partner, strategist at Catalyst S+F.

Related Articles

Digital Out Of Home Ads Increasing

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by Garry McGuire IMedia Connection

Digital-out-of-home (DOOH) is demonstrating its value as a relevant, consistent, and effective medium for advertisers. It’s predictable and easy to buy. But reaching maturity, and realizing broad acceptance and prosperity, will take more work.

Here’s my point of view on the key issues facing DOOH network operators, and how they should be addressed.

Focus on audience
DOOH media is planned and bought much the same way as broadcast, online, and print — by audience profile. The significance of people consuming more media out of the home than in-home has become important to advertisers. The right message delivered to the right consumer, at the right time, along the path to purchase — this premise is now particularly important when targeting an audience.

Stay informed.

For more insights into the latest trends in emerging marketing technologies, attend the iMedia Breakthrough Summit, March 20-23. Request your invitation today.
The chief marketing officers and the agency planners out there don’t buy place. They are not looking to get their message running in certain kinds of venues. They want to reach a certain viewer profile broken down by characteristics like age, gender, and lifestyle. The only exception to that is true out-of-home shops that are selling billboards and, thus, selling specific locations and areas.

Digital-out-of-home is more of an online and broadcast environment than it is out-of-home. By selling audience and not place, the medium is going to get bought more broadly. Place is a great qualifier on a media buy, but the big dollars in the media world right now are in broadcast and online, and those are bought based on audience.

Here’s the sort of pitch that we see resonating with people who control media budgets.

If you operate a gas station network, for example, don’t talk about how many screens are running. Talk about the demographics of the people spending time in front of those screens as they pump gas. You want to convey the size of the audience of men and women, 18 to 52 years old, who have an average household income of $100,000 or higher, and are in front of those screens repeatedly. If you have a retail network, don’t talk about the fact that your screens are in a convenience store environment. Talk about how you represent a viewing audience of 10 million alpha moms, or whatever most powerfully characterizes your viewership.

Make this easy for advertisers and media partners
It’s been pointed out many times by media pros, but I’ll repeat it. It takes far more time and energy right now to plan and execute a small DOOH buy than it does to book a much larger broadcast buy. That has to change. The DOOH industry has to make it easy for advertisers and media planners if it wants to firmly be part of the mainstream.

Make yourself available
The biggest agencies have their own internal media planning systems. If you want to be part of major buys next year and beyond, you must figure out how your media inventory shows up in those systems. If you’re not in there, you’re not on the plans. The biggest agencies that control media dollars have in-house systems for broadcast, and they are quickly moving to systems for DOOH, as well. Starcom MediaVest is already using such a system.

If you can’t beat them, join them
You need to use the common nomenclature, measurement metrics, and pricing methodologies of the media business. You can’t invent your own and force them on a well-established industry.

Adapt to the industry’s needs
Be ready to transact the way that media industry members want you to transact with them. It has got to be the way they want to measure it. It has to be the way they want to price it. If you have a sight, sound, and motion DOOH network, and you are positioning it up against broadcast, you better be able to convert from cost-per-thousands (CPMs) to gross rating points. You cannot walk into a broadcast buyer’s office and talk about CPMs. That’s not how they work.

What happens is that planners struggle and then give up on trying to execute a cross-network buy because they can’t do an apples-to-apples comparison. That then means those DOOH networks that don’t report and sell the way agencies want simply don’t get bought.

Get better at data and analytics
Major media research firms are all now very active in the DOOH sector, and we’re seeing substantial work — such as Arbitron’s “Digital Place-Based Video Study” and Nielsen’s “Fourth Screen Network Audience Report” — being done to define audience characteristics.

We’re also seeing guidelines emerge and be refined in North America and Europe that encourage common ways to measure and report audience metrics, network by network.

Big research is really important in this sector because it makes DOOH easier to buy. The exciting thing is that all the research that is coming back from the field is coming back largely the same. There’s a positive trend reinforcing the impact and efficiency of DOOH. Those great results can’t be dismissed as anomalies because the body of evidence is now too large and consistent.

It’s that breadth of research that will hopefully stop what has emerged as a bad trend in this sector — the willingness to do custom research on media buys. We all want to sell our media so much that we offer custom research on every single ad buy. But that’s a mistake. The costs are too high, and it only adds to a story that’s now well established. Let’s focus instead on the larger industry research.

Speak with a common voice
DOOH network operators need to stop sniping at each other and start talking together about how this media format reaches, engages, and has an impact with consumers outside their homes. As long as we are fighting with each other about who has the best fitness network, or coffee shop network, or whatever it is, none of us will get bought. The media business doesn’t want to listen to us as we air our dirty laundry.

There is a lot of media money out there, and it is constantly moving around from different buckets. DOOH networks have a far better chance of drawing down from those buckets if they move off of trying to sell against their direct competitors and focus, instead, on selling the efficacy of the category.

The tide will rise for everyone if we speak with a common, positive voice.

Garry McGuire is the CEO of Reach Media Group

Beyond Paid Media: Marketing’s New Vocabulary

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Courtesy of McKinsey Quarterly

Changes to the way consumers perceive and absorb marketing messages will force marketers to change not only their thinking but also the way they allocate spending and organize operations.

NOVEMBER 2010 • David Edelman and Brian Salsberg

Source: Marketing & Sales Practice

The rough guide to marketing success used to be that you got what you paid for. No longer. While traditional “paid” media—such as television and radio commercials, print advertisements, and roadside billboards—still play a major role, companies today can exploit many alternative forms of media. Consumers enamored of a product may, for example, create “earned” media by willingly promoting it to friends, and a company may leverage “owned” media by sending e-mail alerts about products and sales to customers registered with its Web site. In fact, the way consumers now approach the process of making purchase decisions means that marketing’s impact stems from a broad range of factors beyond conventional paid media.

These expanding media forms reflect dramatic changes in the way consumers perceive and absorb marketing messages.1 As a result, some strategic-marketing frameworks—such as the popular “paid, owned, earned” one—are in serious need of updating. Many marketers use this framework to distinguish different ways of interacting with consumers, forms of financing, and measures of performance for each contact. Yet the paid, owned, earned framework increasingly looks too limited. How, for example, should a marketing strategist for a company react to requests from other companies to purchase advertising space on its product sites? How should a company deal with online activists when they take hold of a product or campaign to push a negative emotional response against it?

Two media types must therefore be added to the framework: “sold” and “hijacked.” These new forms of media, which demand sustained investment and attention, challenge the traditional strategies, structure, and operations of most marketing organizations. Yet marketers should view their expanding range of media options not only as a challenge but also as an opportunity worth grasping, to encourage readers to share content or even create their own.

Five forms of media

Too many companies view marketing plans as little more than an exercise in where and when to buy media placement. Yet as the number of digital interactions increases, marketers must recognize the power that lies beyond traditional paid media (Exhibit 1).

Paid,owned, earned

Paid media include traditional advertising and similar vehicles: a company pays for space or for a third party to promote its products. This market is far from dying; options for marketers are expanding exponentially with the emergence of more targeted cable TV, online-display placement, and other channels, not to mention online video and search marketing, which are attracting greater interest. The second category, owned media, consists of properties or channels owned by the company that uses them for marketing purposes (such as catalogs, Web sites, retail stores, and alert programs that e-mail notifications of special offers).

Earned media are generated when the quality or uniqueness of a company’s products and content compel consumers to promote the company at no cost to itself through external or their own “media.” Starbucks, for example, announced in July that its Facebook fan base exceeded ten million people, the highest of any US corporation. The company directly links its recent strong performance to its social-networking efforts and “crowd sourced” innovations such as “My Starbucks Idea,” a Web site where anyone can suggest ways to make the company better. Similarly, Honda Japan undertook a promotion on the social-networking site Mixi, where more than 630,000 people registered for information about the launch of its new CR-Z vehicle. The company automatically added “CR-Z” to these users’ Mixi login names (for example, “Taro CR-Z”) and gave them a chance to win a car. Nonregistered users wondered why people suddenly had login names incorporating CR-Z. Thanks to the buzz, prelaunch orders reached 4,500 units, and actual sales topped 10,000 units in the first month.

Sold

Paid and owned media are controlled by marketers touting their own products. For earned media, such marketers act as the initial catalyst for users’ responses. But in some cases, one marketer’s owned media become another marketer’s paid media—for instance, when an e-commerce retailer sells ad space on its Web site. We define such sold media as owned media whose traffic is so strong that other organizations place their content or e-commerce engines within that environment. This trend, which we believe is still in its infancy, effectively began with retailers and travel providers such as airlines and hotels and will no doubt go further. Johnson & Johnson, for example, has created BabyCenter, a stand-alone media property that promotes complementary and even competitive products. Besides generating income, the presence of other marketers makes the site seem objective, gives companies opportunities to learn valuable information about the appeal of other companies’ marketing, and may help expand user traffic for all companies concerned.

Hijacked

The same dramatic technological changes that have provided marketers with more (and more diverse) communications choices have also increased the risk that passionate consumers will voice their opinions in quicker, more visible, and much more damaging ways. Such hijacked media are the opposite of earned media: an asset or campaign becomes hostage to consumers, other stakeholders, or activists who make negative allegations about a brand or product. Members of social networks, for instance, are learning that they can hijack media to apply pressure on the businesses that originally created them. High-profile examples involve companies ranging from Nestlé (whose Facebook page was hijacked) to Domino’s Pizza (a prank online video of two employees contaminating sandwiches appeared on YouTube).

In each case, passionate consumers tried to persuade others to boycott products, putting the reputation of the target company at risk. When that happens, the company’s response may not be sufficiently quick or thoughtful, and the learning curve has been steep. Toyota Motor, for example, mitigated some of the damage from its recall crisis earlier this year with a relatively quick and well-orchestrated social-media response campaign, which included efforts to engage with consumers directly on sites such as Twitter and the social-news site Digg.

The impact of the media revolution

The changing role of older media and the emergence of newer ones extend the marketer’s role well beyond the allocation of budgets and channels. Marketers today require a deep understanding of how consumers engage with different types of media at each stage of the journey toward a purchase decision. What’s more, these different kinds of media are related and interact with one another (Exhibit 2), so marketing plans and capabilities must adapt and evolve. Paid, owned, earned, sold, and hijacked media are evolving in four primary ways.

First, different kinds of media are becoming more integrated. The reach of paid media, for example, means that they will increasingly serve as feeders into owned-media hubs, where marketers can offer a more engaging experience, get consumers interested in products, and pivot into an ongoing and more targeted stream of contacts with users or members. New ways to connect with customers, for example, are transforming traditional relationship management by requiring marketers to interact with consumers through multiple forms of media in increasingly personalized ways. JetBlue has promoted its Twitter offering through many channels, for instance, and now has about 1.6 million followers seeking a regular feed of special deals for tickets. This approach has given JetBlue the ability to deliver timely coupons at a minimal variable cost, reducing its reliance on expensive paid media while fostering closer relationships with consumers.

Second, new publishing models are emerging because the increasing complexity of consumer needs and of efforts to address them means that marketers can’t do everything—and they are leaning on media providers for help. In what’s almost a throwback to the days of the soap opera,2 marketers are partnering with media publishers to create deeper marketing experiences for consumers and to obtain content and ad sales support. Computer maker Dell and automobile manufacturer Nissan, for example, worked with the Sundance Channel to create a television talk show hosted by Elvis Costello to attract their target demographic. With ads that seamlessly blended into the show’s content, Dell and Nissan not only gained exposure to a highly engaged audience but also shifted the perception of their brands to connect with late-stage baby boomers and with generation Xers.

In addition, applications on devices such as Apple’s iPhone are spawning tools that provide useful information. For example, eBay’s Red Laser generates a list of prices for any product whose bar code has been scanned by a mobile phone. Beverage companies show where their products are available by overlaying icons onto maps on the screens of mobile phones. In Japan, food manufacturers can increase sales across entire product categories through marketing collaborations with platforms such as Cookpad, the country’s leading online recipe site, with nine million members, more than 40 percent of whom are women in their 30s.

Third, marketing experiences are becoming more personally relevant. At first glance, personal conversations and experiences wouldn’t seem to be the best way of getting the scale and reach most marketers crave. But new kinds of media enable richer interactions and improve targeting, so they encourage consumers to share the things that make them happy. McDonald’s in Japan, for example, has developed expertise in the use of Twitter and other blogging platforms to promote new products and promotions by leveraging its huge fan base to talk about how much they love the company’s food. While this fan promotion is sometimes spontaneous, it’s often facilitated and encouraged by providing these fans with free meals. In this way, paid- and owned-media efforts (such as blog and Twitter campaigns) make consumers so enamored of McDonald’s products that the company generates a significant amount of earned media.

In a related phenomenon, the evolution of new kinds of media means that consumers are engaging more often in real-time conversations, particularly on social networks and other digital platforms. Helping consumers to express themselves is a scary and significant reversal of the control marketers have traditionally tried to maintain over brands. While most marketers are already exploring tools to monitor conversations in social media, they need to develop triage and action engines to ward off people seeking to hijack their media.

One consumer electronics company, for example, has recognized that every review or rating posted about its products creates the possibility of a hijacked conversation. It now responds to all comments within 24 hours: positive feedback gets a thank you, an invitation to become a Facebook friend, and special offers; negative reviews get explanations of how to fix issues, instructions on how to navigate an interface more easily, or follow-up questions to learn more about what the consumer didn’t like. Some hotel chains, recognizing the importance of travel sites (such as the popular TripAdvisor), likewise encourage satisfied guests to post comments online, while employing staff to follow and answer negative comments. These conversations become an interactive public-research project to gather information for future improvements. In effect, the evolution of media types means that a company’s marketers are now on the front lines of its efforts to deliver outstanding goods and services.

The challenge for marketing organizations

Marketers offer rich and complex experiences. But the consumer’s standards for the consistency of information encountered in different venues, the way it is provided in each of them, and its usefulness are becoming more stringent daily. Likewise, publishing, the brand experience, cultivating advocacy among customers, and generating personalized leads are now more important. These realities create four priorities for marketing organizations:

  • Think strategically about the role of each media type. As companies move more aggressively into, for instance, owned and earned media, the role of paid media should change: it may be used to drive consumers toward a company’s owned media or, more sparingly, as a “booster” for new-product launches and other promotions. That may require tighter coordination with ad agencies regarding the design and placement of marketing content. To reflect the influx of traffic to owned media, companies may also need to change their budgets and operations.
  • Rebalance time and resources. Owned media require patience, cultivation, and sustained engagement. Like the products of any good online publisher, a marketer’s owned media need a steady stream of traffic-building programs, fresh content, and optimized design. Focused management, sufficient budgets, and appropriate performance metrics are needed to build owned-media platforms, whether they’re foundational search or social-media efforts, site hubs, alerts, or feedback-gathering communities, to name a few possibilities.
  • Develop a clear community or social-networking strategy. Companies need an agreed-upon set of rules and principles for managing and responding to single or coordinated attacks against the brand. It’s imperative to appoint an experienced community or social-networks manager who knows in advance how to coordinate with marketing, public relations, legal, and other relevant units and has the required authority and decision-making rights. The cost of failing to respond effectively can be high. One multinational company, for example, responded to accusations about its business practices by arguing with its accusers on its Facebook page, even blocking and deleting posts. That move only heightened public interest in the dispute, in effect hijacking the page until the company apologized.
  • Improve both the art and the science of marketing. Debates among pundits of marketing typically focus on whether it is an art or a science (and thus on the relative importance of creativity and analytics). Actually, the bar is rising for both art and science, and a third dimension—execution—is growing in importance as the complexity of marketing escalates and its practitioners seek to deliver a richer consumer experience. This goal calls for teams that can design campaigns for a number of very different kinds of channels, from TV to social networks to search optimization. Data must be used more effectively to reach decisions and to apply them. Technology must make the spending of each dollar more efficient in the face of greater complexity. Quality must be defined and measured, and risks mitigated and managed.

Of course, the investment in hiring staff to answer every social-media posting may be tough to justify at first, but this approach will probably become critical for mitigating the threat of brand hijacking. And to deny negative reviews and comments legitimacy, companies must be able to make the justifiable design or service improvements consumers seek.

The list of challenges is long, and priorities will vary dramatically, depending on an organization’s competitive dynamics, willingness to experiment, and skills. Few of the necessary changes can be made through mandates from on high; they must happen organically. Ideally, chief marketing officers and other leaders would put together fresh, well-crafted pilots and get the support to invest in breakthroughs that can be applied at scale.

The proliferation of media types gives marketers a dramatically richer arsenal to deepen the engagement of consumers with brands cost effectively. Stepping up to meet the high bar of expectations, however, requires a renewed focus on execution, coordination, speed, and performance.
 

About the Authors

David Edelman is a principal in McKinsey’s Boston office, and Brian Salsberg is a principal in the Tokyo office.

Making Advertising Relevant To Boomers

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Courtesy of Matt Thornhill and Media Post Publications

In a national study called “The New Generation Gap Study” done for TV Land in 2007, consumers of all ages were asked if they agreed with the statement: “If it is done right, advertising definitely influences my purchases.”Some 55% of younger adults, those under age 45, said they agreed. But so, too, did 55% of Boomers. (Wow, only 55% agreed to that? Well, that must mean John Wanamaker really was speaking the truth when he allegedly said, “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.”)

Nonetheless, we’ll take this as good news: Advertising can influence purchases.

The bad news is that, in study after study, Boomers tell us most advertising is not even intended for them. Last summer, Google and Nielsen fielded a national study among adults of all ages to learn more about online activity and media usage. They asked if we wanted to include any questions in the survey to update information we had published in our book, Boomer Consumer, in 2007.

Two questions we added to the study were about the intended target of advertising. Sure enough, Boomers told us the vast majority of advertising they see on TV or on the Internet is intended for “someone younger than I.”

Our question: Advertisers communicate with consumers in a variety of ways. In general, who would you say most advertising is intended for?  

Google/Nielsen Consumer Study,
Summer 2010
On TV
On the
Internet
Someone YOUNGER than I 79% 84%
Someone MY AGE 19% 15%
Someone OLDER than I 3% 2%

As you have read here, this is a demographic cohort that spends over $2 trillion annually on consumer goods and services. Yet, 8 out of 10 Boomers tell us they think the advertising they see — presumably on shows they watch and Web sites they visit — is intended for younger consumers.

It’s no wonder the average tenure for a chief marketing officer is less than two years. Heads certainly need to roll if advertising dollars are so poorly deployed.

Make it Relevant

The fix for this problem is easy to spot, but perhaps difficult to pull off. First, you don’t have to double your advertising budget and develop a completely separate marketing program to reach Boomers. All you have to do is make your current programs relevant to consumers across all age groups and generations.

That means look for ways to make your product, packaging, pricing, messaging and distribution relevant for more than simply your traditional advertising or marketing sweet spot — adults 25-54, or moms with young kids. Take a look at your advertising over the last several years. Do you always show the “ideal” target consumer enjoying your product or service? Do that year in and year out, and you will effectively communicate that is the only person who should use your product.

Instead, use messaging techniques that cut across age groups or generations. We work with clients to find the attributes and benefits that are universal — appealing to a broad range of consumers and relevant to all.

Two examples: There is universal appeal in the Dove brand’s Campaign for Real Beauty approach, and it is relevant for women of all ages. The new Old Spice campaign may appear to be for young, virile men, but the underlying message that this brand is for a “man’s man” is universal.

The goal is advertising that isn’t targeting young adults or Boomers, but more consumers.

Boomer Project founder/president Matt Thornhill is an authority on marketing to today’s Boomer Consumer. He has appeared on NBC, CBS and CNBC, in “BusinessWeek,” “Time,” “Newsweek” and “The New York Times” and countless others. Matt is also the co-author of the business book “Boomer Consumer.” Boomer Project is a marketing research and consulting firm and has done work for Johnson & Johnson, Lincoln Financial, Samsung, Hershey’s Foods and Home Instead Senior Care. Reach him here.