The Future of Advertising Is Clear — Measurement, not So Much
By Tim Wilson on in Metrics, Social Media with One Comment
Fast Company published a lengthy article last November titled The Future of Advertising, and it’s a good read. It traces the evolution of the advertising industry over the past 50 years, and it does a great job of assessing the business model(s) that have worked over time and why. That all serves as a backdrop for how the author posits digital and social media, and the crowdsourced-fragmented-wiki world we now live in is blowing those models up. And, it highlights a number of examples of agencies that are successfully shaking up the ways they operate. It’s a great read.
As I read through the article, I was eager to see what, if anything, came up regarding measurement and analytics. The sole mention turned up on the fourth page of the article (bold/underline added by me):
Every CEO in the [advertising agency] business…wants to be financially rewarded for performance, and thanks to all those new data-analytics tools, for the first time ever, their effectiveness can be measured. Says IPG chairman [Michael] Roth: “We should get higher [compensation] if it works and lower if it doesn’t. That’s how this industry can return to the profitability level.” It’s a nice thought, but those tools aren’t infallible: While Wieden’s innovative Web campaign for P&G’s Old Spice garnered tons of publicity, Ad Age speculated that the boost in sales may well have been due to a coupon.
So much for the silver bullet.
First off, the “every CEO in the business wants” statement is a little odd. Unquestionably, every CFO would love to be able to pay for performance, both the leaders in the company’s own marketing organization, as well as every agency with whom the company works. And, sure, every agency executive would agree that it is fair and reasonable to be paid based on performance. But, I don’t exactly think the advertising industry is flush with agencies wishing they could have performance-based compensation. Sure, agencies want to be able to measure the business impact of their work, but that’s so they can demonstrate their value to their clients, so, in turn, they can retain and grow those clients.
Just as my dander was good and raised, I hit the second sentence that I bolded and underlined above: “It’s a nice thought, but those tools aren’t infallible.” <whew> The voice of reason. But, the “new data-analytics tools” wording implies that there is some whole new class of business impact measurement platforms, and there simply is not. There are scads of emerging tools for measuring new channels like blogs and Facebook and Twitter, and there are lots of really smart people trying to build models that can supplement or supplant the broken reality of marketing mix modeling. But, we’re far, far, far from simply having “tools that aren’t infallible.”
Finally, the snippet above brings up the Old Spice campaign that featured Isaiah Mustafa in an eye-popping number of clever and consumer-engaging videos. No rational marketer would look at that campaign and try to judge it solely based on near-term sales. Word-of-mouth impact, consumers talking positively about the brand, existing customers quietly puffing out their chests because “their” brand is making a splash. How can that not lead to increased awareness of the brand, a positive shift in brand perception, and, I would think, 12-24 months of lingering positive effects? Is all of that worth $100 million or $1 million? I don’t know. But, from a “results based on what the conceivers of the campaign hoped to achieve,” it’s hard to argue that it delivered. But, I’m really not going to continue that debate — just want to point out that “immediate sales impact” is, well, the same sort of old school thinking that the rest of the article takes to task.
I still liked the article, but the brief measurement nod was a bit bizarre.