All that glitters isn’t gold!

October 19, 2011

A new survey of marketers conducted by the Association of National Advertisers has discovered something interesting, but not terribly surprising about the new media rage.  According to the survey, more national companies are dedicating larger portions of their ad budgets to new media.  But it also finds more companies questioning the effectiveness of their new media investments.

78% of companies surveyed said that they planned to spend more on new media like online ads, social networks, search engine marketing, mobile and viral video in 2012 than they did this year.  On average, this represents 14% of their total media spending – up from 10% in 2011.

So, with more spending come better results, right?  Not necessarily.  Compared to a similar study in 2009, marketers in general, are complaining that bigger investments in new media are not always producing the desired results.

“While marketers have substantially increased their use of new media platforms over the past few years, they are beginning to question the effectiveness of some of these vehicles,” Bob Liodice, president and CEO of the ANA said.  “The ANA survey indicates a strong willingness by marketers to integrate innovative new approaches into their marketing mix; however, this enthusiasm is tempered by concerns regarding the ROI of these emerging options.”

Or in other words, anyone who thought that new media was going to quickly transcend old media (i.e. television) was perhaps blinded by all the glitter.

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It’s the Creative Stupid!

April 29, 2010

That’s exactly what I want to tell advertisers who continually complain about how television has lost its effectiveness.

You won’t see Progressive Insurance complaining. The company recently blew away analysts’ expectations with a 27% jump in quarterly profit. They also noted the fifth straight quarter in which their auto policy counts have been up. 

It appears the television commercials featuring “Flo” are winning over more than a few new customers for Progressive. The quirky cashier’s appeal is grabbing market share faster than she can fire off another zinger. 

Now back to the problem with TV advertising?

It’s pretty basic. It always has been. Engage viewers with something compelling, add in a relevant, unique selling message and stay consistent with it. And most of all, keep an open mind.

How many Insurance company executives would have thrown their agency out the front door if they presented them with commercials featuring a talking gecko … or a bunch of cavemen stuck in the ‘80s … or a sarcastic cashier sporting a tricked-out name tag with “Flo” emblazoned on it?

What would your reaction be?  

Remember, pedestrian creative produces pedestrian results. 

TV will continue to deliver excellent ROI, but only for those retailers willing to step out of their comfort zones.

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TV Advertising Pays Dividends NOW

April 20, 2010

After 27 years in the advertising business, I have been exposed to all kinds of propaganda, and I’m sure I have been guilty of propagating some myself.  But, I have always tried to base mine on logic.  So when I hear the social media people tell me that television is fast becoming a thing of the past, I must question the logic in which they base this claim.

 Are they unaware that in 2009 the average American home had 2.86 TV sets; 18% higher than 2000 and 40% higher than in 1990? 

Or that Americans spent over 36 hours a week watching TV last year compared to 4-hours a week using the Internet?

Perhaps they also forgot that 35% of all advertising dollars will be directed to TV advertising in 2010.

Even if they were aware of these facts, I’m sure it remains a mystery to them “why” television remains so popular.

So, let me clear up this mystery as succinctly as possible. Consumers continue to purchase TV sets, at a record pace, because they simply enjoy watching what’s on them. It’s passive entertainment. It requires them to do absolutely nothing, but switch it on. A comforting concept in today’s overly active world.

TV receives 35 cents of every ad dollar spent because it works for its advertisers. Despite the debate over Push vs. Pull marketing; there’s apparently more than enough consumers who are still happy to be “pushed” into stores all across America. 

While building online communities, cultivating dialog and adding twitter followers may eventually pay dividends.

TV pays those dividends NOW. 

And from a retailer’s standpoint, coming off the worst recession in 70 years, I can’t think of a better reason “why.”

 

Source:  Nielsen Television Audience Report, 2009

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The Gap replaces retail TV budget with Web and Social Media

August 23, 2009

Picture for Post #14After reading about The Gap’s new online advertising campaign, I was left yearning for the days where retail advertising had a more concrete purpose – like maybe selling something.  

 

 

 

 

I thought agencies were about developing engaging strategies to increase sales and market share.  And I thought those who were responsible for such strategies had some accountability when it came to delivering results.

If the new Gap strategy is any indication – my thinking may have been wrong.  

The new ad campaign from The Gap, titled “Born to Fit,” includes no TV commercials instead, for the first time in the retailer’s history, The TV budget has been replaced with Web and Social Media – more specifically Facebook.  Print, cinema and outdoor ads have been developed to drive consumers to the campaign’s Facebook page.

Always open to new ideas … I eagerly logged onto The Gap’s Facebook page. After a few seconds, I clicked onto the video section, expecting to hear why people like wearing Gap jeans.  Instead I was treated to a short video from seven so-called celebrity “icons” – each one yammering on and on about the complexities of their “intriguing” lives.  

As they speak, each “icon” (and I use this world loosely) is sitting on a stool against a white background while the camera – occasionally – pans down to the Gap jeans they are wearing.  By the time I watched all of them, I wasn’t sure if The Gap wanted me to buy a pair of jeans or question my place in the universe.

Julie Channing, senior account director with The Gap’s digital agency explains the strategy this way, “We were really looking to reach out to fashionistas and influence audiences to start a conversation about how Gap has built this line of denim from the ground up.”

Really?  So, consumers are going to visit a Facebook page and soon after begin conversing with friends and family about the development of a new brand of blue jeans?

Channing goes on to say, The Gap had set no numerical benchmarks to determine success in the campaign, but rather would look at “how much consumers interact with the brand” to gauge ROI.

So, let me make sure I understand this – The Gap’s ROI objective is to count how many people are talking about jeans, not how many are buying them.

Don’t you just love how some companies are using social media?

 

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Retail TV Advertising: “It’s not creative if it doesn’t work.”

August 22, 2009

1960-Philco-TV-AdAs an ad agency owner, it never ceases to amaze me on what makes this business tick. In light of the worst economy in 60 years, logic would say that agencies should be pitching their ability to make the cash register ring.

Instead, any talk about getting customers through the door is obligatory at best with a lot of agencies. Why talk about results when you can drone on and on about your agency’s “award winning” TV commercials? After all, it’s how many awards an agency wins that separates one shop from next. Right?

Who’s kidding who, it’s a lot easier for agency people to wax philosophical on their “break through creative” (the most over-wrought words in advertising) than to defend their work through the prism of increased market share and higher comparative sales.

Unfortunately, too many of my colleagues have forgotten the golden rule in retail advertising:

“It’s not creative if it doesn’t work.”

And even more prefer the easy way out through the creation of advertising that “tells not sells.” You know, the kind of commercials that spend 22 seconds setting up the joke and the last 8 seconds poorly selling the product.

So the next time, you’re ad agency is enthusiastically trying to sell you on another “award winning” television campaign. Keep them honest and ask four simple questions:

  1. What is the strategy behind what you’re proposing? (Note: “because it’s such a cool idea” is not a strategy.)
  2. Why is this campaign the best use of my advertising dollars?
  3. Is there anything else we could do that would deliver a better ROI?
  4. Will this campaign increase awareness or sales? (Note: awareness is hard to measure; sales are not.)

Then, just sit back and get ready for the show; along with developing all those award-winning commercials – many agencies have become quite adept at the lost art of tap dancing.

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Retailers: Think Twice Before Cutting Back Your Ad Spending

August 18, 2009

Picture for Blog #9A new study by ThinkVine, a Cincinnati analytics firm, offers evidence that cutting out ad spending during a recession can have harmful consequences.  

The firm that does predictive media modeling for marketers such as PepsiCo, and Colgate-Palmolive, found that although companies can usually get away with cutting media spending in the short term; cutbacks over 16 weeks can start to erode sales volume. 

The firm analyzed the effects of turning off all advertising entirely for a year on one unnamed brand.  It then studied the effects of turning it back on the next year at prior levels.  Here’s what they found: 

  • For about 16 weeks, sales volume was about the same. 
  • By the end of year one, however, sales volume was about 20% lower without advertising than with it. 
  • Turning the advertising back on in year two, reversed the sales decline as the brand began growing again at the same rate before the advertising was stopped. 
  • However, the advertising was not able to close the gap in sales compared with what it would have achieved had it maintained media spending for both years. 

Different brands respond differently to media cuts, but for many – getting back sales and share lost from cutting budgets can be a lengthy and an expensive process. 

ThinkVine CEO, Damon Ragusa, said it best:

“The cost of getting back what you lose is often greater than the savings of not advertising.”

 

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Are TV Ads Still Effective for Retailers?

August 17, 2009

50s TV commercialYou bet they are!

A study of 388 case histories by the Advertising Research Foundation (ARF) found that TV is not only effective, but it is possibly even more effective when it comes to increasing sales.

In today’s complicated world “TV ads help simplify the buying decision, said Joel Robinson,” ARF’s Chief Research Officer.

“People want to zone out and watch TV and relax and let the communications wash over them. TV is an extension of the brand experience.”

Robinson said, the findings concluded that “units sold numbers increased as a result of increased TV impressions.” He added, “When you see it across 388 case histories, I think you’ve got to believe it.”

The report titled, Empirical Evidence of TV Advertising Effectiveness was an analysis of case histories gathered from seven different research agencies from 1990 – 2008.

The study also concluded that TV was #1 in terms of raising brand awareness.

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