Wednesday, April 9, 2008

Engagement Top of Mind at IAA World Congress

The article is enough to bring tears of joy to the eyes of an experiential marketer. Ad Age reports from the International Advertising Association's 41st annual World Congress, and the article contains eye-popping lines such as, "Online is not just a sales channel, and technology will only increase engagement with consumers" and "more focus will be placed on using digital creative to engage users rather than just advertise to them."

When a 50-year-old ad organization begins to talk about wanting to do more "than just advertise" to consumers, you know that exciting changes are afoot. What is sad is that the idea of engaging consumers rather than simply advertising to them seems the least bit revolutionary.

The message at the IAA conference was that technology will continue to drive changes throughout the ad business, but content and creativity matters. Said Kevin Johnson, Microsoft President of Platforms and Services, "We no longer look at digital as a discreet driver. This is a technology-enabled marketing environment. All the marketing specialists need to be well-versed in digital."

Tribal DDB West President Elizabeth Ross notes that technology isn't just changing how we advertise but is changing the very nature of the consumers' role in marketing. "Consumers are the new media and they know it. You have to market with consumers, not at consumers. Ultimately it becomes a collaborative process. It's no longer linear."

Leo Burnett USA CEO Tom Bernardin persuasively offered, "A majority of brands' success comes from connecting to real people. Instead of broadcasting the brand, we need to give time to experience the brand. We need brands with a purpose."

Bernardin offers a rule of thumb to ease "the confusion and frustration a marketer might feel when approaching the digital domain," but his advice is both overly simplistic and too conservative. He suggests a 70/20/10 rule where 70% of digital monies go toward creative and established areas of digital marketing including search engine, 20% goes to emerging areas and 10% goes to experimentation.

I'm pleased to see a big agency leader tackling the question of experimentation and emerging media, but I can't help but wonder if this recipe is appropriate for all (or any) brands. First of all, there's the obvious question of what defines established vs. emerging vs. experimentative. Bernardin says that the established category includes "things you most likely have been implementing for one to two years." That's great if you've been experimenting all along, but considering the number of brands that still dedicate the vast majority of their online marketing budget to ad buys, 40% or 50% may be more advisable than 70%.

Bernardin's "emerging" bucket includes mobile marketing, social networks and certain types of gaming. Again, I'd suggest that depending upon your brand, your audience, and your goals, allocating just 20% of your budget to these activities could be harmful to your brand's health.

Perhaps the even bigger problem I have with Bernardin's rule of thumb is that while I think it is laudable to encourage greater experimentation and spending in emerging media, the question shouldn't be one of "How do I allocate my budget?" but "What concepts will best help me achieve my brand goals?" I understand managing marketing budgets is an essential task for any marketing leader who wishes to retain his or her job, but it still seems like a sad state of affairs when we start with how we'll slice and dice our budgets rather than beginning with what the brand wants to achieve, what customers expect, where they'll be found, and how the brand will provide the kind of experience that achieves the brand goals. Marketers should want to spend 100% of their budget that way!


Jeff Larche said...

I too wondered, when I read Bernardin's 20% rule, if that share of marketing budget was sufficient. The emerging media -- including mobile marketing, social networks and gaming -- have the potential to deliver strong returns on investment. Then I realized that many emerging media also have emerging price tags. These media do not necessarily have to have hefty price tags. Chosen strategically and specified carefully, you could make that 20% stretch quite far.

For example: A presence on social network sites does not have to cost a fortune. It can also be surprisingly measurable.

Thanks for a great post!

Augie Ray said...

Thanks Jeff. You're right, playing with emerging media doesn't have to mean a large budget, but I sometimes wonder if emerging media is a little like sponsorships--there's the cost to do it, and then there's the cost to activate it.

For example, creating a game is one thing. Promoting it so that awareness and traffic are generated is another.

Or, Bernardin mentions social media. I suppose one could easily and cheaply do advertising on social networking sites, but there's plenty of evidence that isn't a very effective strategy.

The My Starbucks Idea program seems like a more successful strategy (or at least a more attention-getting strategy). But the cost to develop the site was just a small portion of the overall price tag--there was also PR, monitoring the site, acting on ideas, etc.

Just like a sponsorship that isn't activated, I'd be concerned the "20% rule" would tend to undermine otherwise effective programs that may require more attention and funding to succeed.

Really appreciate the thoughts!