Convince and Convert Blog: Where Social Media and Email Collide

Excellent post by Bart Cleveland on the AdAge Small Agency blog recently about Comfort Zones.

Bart made the point that if you get too careful and comfortable in your agency, you won’t attract clients that are looking for innovative work. There’s no question this is true. His post used “risky” or groundbreaking creative as the benchmark, but I’d say what services an agency provides is perhaps an even better measure of its Comfort Zone.

Digital marketing is NOT comfortable for most “traditional” advertising and PR firms. I get that. I’ve lived it. But, given the fact that digital marketing is growing extremely fast at the expense of other tactics, and given the fact that this will be even more acute in a down economy, agencies’ resistance to fully embrace digital is confusing.

The vast majority of agency principals are very smart folks. I know this to be true. They are good businesspeople, and great marketers. They clearly recognize that digital is taking a larger and larger share of the pie every year, and that digital-only shops are a growing threat.

Thus, if the awareness is there, I conclude that fear and uncertainty is the obstacle for most agencies to really get going on digital.

Digital Marketing is Like Learning French

In my experience, many agency leaders are immediately overwhelmed by the dizzying array of numbers, vendors, acronyms and general craziness inherent in digital marketing. I absolutely understand that coming at digital head on can be frustrating and baffling.

But, there’s an awful lot of jargon and insider knowledge in traditional advertising and PR too, and agency principals managed to pick that up somewhere.

True, digital marketing has a lot of specific terms. But if you can learn a foreign language, or learn how to write up a media plan, you certainly can figure out digital marketing basics.

It’s Not Different. It’s The Same.

The number one mistake that I see agencies make is to treat digital totally differently than other elements of their organization. In a lot of shops, it’s like Area 51. The digital guys are separated, quarantined and viewed with a mix of reverence and curiosity.

This causes two huge problems.

- Your digital guys have almost no oversight because nobody can speak their language
- You never really integrate digital into the fabric of the agency or even at a campaign level, because your “traditional” teams don’t understand or work closely with the digital teams.

There’s no other marketing tactic that gets treated this way. Would you hire a single radio expert and put them in a corner of the office and only deal with them when necessary and then say “okay radio guy, I don’t understand this very well, but do your stuff.” Of course not.

Ultimately, digital marketing is just that…..marketing. The same rules apply. Figure out the characteristics of prospective customers. Figure out how to most efficiently reach them. Craft messages that matter to them. Deliver those message. The main difference between traditional and digital marketing is the ability to measure success definitively, and that’s an advantage that should be embraced by agencies.

Many agencies are beginning to implement digital marketing tactics on their own behalf, using themselves as guinea pigs to develop greater digital prowess and confidence. This is an approach advocated by Michael Gass at Fueling Ad Agency New Business who works with agencies to set up their own blogs.

If you’re not fully embracing digital, why not? Leave a comment.

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AdAge reports that GM has moved approximately 25% of its total media budget online over the past three years. That’s 25% of a $2 billion+ annual media spend.

A current focus for GM’s online initiatives is the new Used Car Ambush program, a microsite and online campaign intended to convince used car shoppers to purchase certified GM used vehicles, rather than those sold by private parties.

The site is perhaps a bit too polished to pull off its desired “organic” vibe, and it requires a serious download commitment from the user. But, this type of online-only content and accompanying campaign demonstrates that car makers are trying to use the Web to make their overall media spend more efficient in these tough economic times.

Targeted Ads Are More Efficient

From an online advertising standpoint, moving dollars online (at the expense of TV) is a no-brainer for automotive and other highly considered purchases. Here are just a few of the way you could target your advertising online to reach only consumers with a demonstrated interest in making a vehicle purchase in the near future:

- Manufacturer Web site
- Dealer Web sites
- Paid search
- Organic search
- Behaviorally targeted banner ads
- Ads on auto aggregator sites like cars.com
- Ads on blogs and social networking sites devoted to vehicle research and reviews (However, we do not recommend ads on social networks. Here’s 3 reasons why:)

Conversely, here are the ways to isolate TV viewers so that you are only reaching folks that are currently in the market for a vehicle:

- Using demographics and psychographics and hoping for the best

Furthermore, reaching out to prospective buyers online enables automakers to presumably collect data from Web site visitors, allowing for ongoing, targeted follow up via email, postal mail, etc.

Broadcast Is Not a Research Medium

Of course it’s true that the Web doesn’t reach everybody. As Dan Gorrell from Autostrategem mentioned in the AdAge account of GM’s spend, 34% of U.S. new vehicle buyers do not use the Internet to shop for an auto. He states that this makes GM’s online strategy a “double-edged sword.”

This makes zero sense to me. First, if 66% of the country IS using the Web to research new vehicle purchases, that’s a colossal market segment. Second, I very much doubt that the other 34% are instead using television to research vehicles. How would that work exactly? You watch “24″ hoping commercials for cars you like appear at the breaks?

Comparing Internet and TV as opportunities for consumer pre-purchase research is like comparing apples and chihuahuas.

Broadcast Creates Demand. Online Fulfills It

Let’s don’t go crazy, however. There’s no question whatsoever that online advertising doesn’t have the reach or power to go it alone for a broad category like automotive. You need TV to generate initial interest and awareness (unless it’s just an under the radar program like Used Car Ambush). Once that awareness takes root via broadcast, the online components of the campaign pick up steam in a hurry.

I’ve seen this happen many times, and it’s an easy phenomenon to measure (and agencies should try it). Measure search volume for your key terms. Then run a broadcast campaign (alone) for a couple of weeks. Then remeasure your search volume. You’ll find it goes up considerably. The same thing happens with banner ad campaigns. Click through rate always goes up after the market has been “softened” by broadcast.

Automakers looking to market more efficiently should reduce their TV spend and use it in short bursts at the beginning of campaigns to introduce new models and programs, and then follow up with aggressive Internet advertising programs that are much more targeted and cost effective.

Do you agree? Leave a comment.
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A report last week by the Publishers Information Bureau found that advertising pages in the nation’s magazines declined by 7.4% compared to the first half of 2007. 

With the stock market down by about 20%, and house prices down at least that much in some parts of the country, a 7% dip in magazine ads may seem less frightening than the prospect that Angelina Jolie will somehow end up being mother to all of the world’s children. 

However, there are two inexorable trends in marketing right now and neither bode well for magazines mid or long-term. The economy will rebound at some point, but even when that happens, will magazines recoup their share of the advertising pie? In general, I think not. 

First, marketing is increasingly about measurability, and on that front magazines score no better than any other “traditional advertising” tactic like TV, radio, or newspaper. I would put magazines ahead of outdoor on that scale, because at least they have audited circulation. But how does the savvy marketing director (or agency media buyer) determine the financial impact and ROI of magazine? Short of tracking URLs and phone numbers (which basically pass the measurement buck off to another medium), it’s pretty difficult to isolate the effect of a magazine buy - which is why digital marketing is growing and everything else is stagnating in this down economy. 

The second issue for magazines is speed. The lead times required by monthly magazines for advertising and editorial are positively anachronistic. Consumer magazines are working on their October issues right now. Seriously? By October, Brett Favre could be playing quarterback for the Bears, and all of California could be on fire. In these uncertain times, committing to expensive magazine ads 90 days in advance seems like a leap of faith that fewer advertisers are willing to make. 

And speaking of speed, magazines without an especially sharp editorial focus and solid reporting are going to have a tough time in a culture where information is conveyed in 160-character bites RIGHT NOW. Interestingly, some of the magazines showing the biggest decline in ad pages this year are those who cover topics that are perhaps covered better online by sites and blogs.

Blender (-23.5%). See www.pitchforkmedia.com, last.fm

Business Week (-14.8%) See www.thestreet.com, www.cnbc.com, www.businessweek.com

PC Magazine (-35.8%) See www.gizmodo.com, www.cnet.com

Newsweek (-22.4%) Time (-21.1%) and U.S. News (-30.3%) See www.huffingtonpost.com, www.nytimes.com, and Twitter, where thousands of people are discussing current events as they happen, not a week later. 

Interestingly, one area of magazine-ville that showed consistent gains was food publications. With gas and food prices soaring, Americans are eating out less and trying to craft delicious meals at home. I’m not sure this trend is going to do anything about the obesity problem, however, as Cooking with Paul Deen ad pages were up 31%. That lady is physically incapable of executing recipes without at least one pound of sour cream. 

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Market Research firm Advertising Perceptions released a new survey of 1,811 media buyers showing that a whopping 72% of them believe Internet advertising spend will increase in the second half of 2008.

This is a shocking finding, considering that no other medium (other than mobile) was expected to grow by more than 28% of the respondents.

The outlook for newspapers and radio was especially pessimistic, with more than a third of respondents projecting overall spend to drop for those media in the next 6 months.

While we’re big supporters of mobile here at C&C, 55% of media buyers suggesting that mobile spend will increase was also a suprise. As a somewhat experimental tactic, we’d expect mobile to be set aside temporarily in this down economy. However, the measurability of mobile (which is also a terrific database acquisition tactic) could be fueling the optimism about it.

Without question, the measurability of Internet advertising and search marketing is what’s driving the move of ad dollars from traditional tactics like newspaper toward digital marketing. This move is going to be even more acute in a recession, as digital’s cost-effectiveness, speed of deployment, and targeting capabilities make it a “safe” media bet for most companies and agencies.

It will be very interesting to see if this movement of ad dollars toward digital results in markedly higher CPMs for banner ads by year end. We’re already seeing increases in PPC costs due to the “over-popularity” of Google.Similar Posts That You Might Enjoy

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Fascinating article in BrandWeek today about putting a value on word of mouth marketing.

BzzAgent, a word of mouth marketing agency (how’s that for a good gig if you can get it), says they figure an online conversation about a brand is worth 50 cents.

It’s admirable that somebody is trying to put a value on word of mouth and social media marketing, because today it looks a lot like that Smoke Monster on Lost, or SEO pricing circa 1999. But, I’m not sure that 50 cents is a metric that makes sense. Interesting, however, is the fact that a much more rigorous study conducted by ChatThreads Group found a 51 cent average value (based on estimated number of product units sold).

Note: Here is a nice slide deck from Digital Influence Group on measuring social media, via SlideShare

| View | Upload your own

The biggest problem I have with this type of math is that it is so inherently tied to all other facets of an integrated marketing plan. Word of mouth isn’t like search marketing, where you need something, you look for it, and you find it. Via search, I’ve found a company or product I didn’t otherwise know countless times. With word of mouth, it seems more likely that a product or service will be mentioned and I’ll already know it, it’s just a reminder. Thus, it’s not a “new mention” but a “reminder mention” and that’s worth less to me as a marketer.

Further, the biggest fallacy is assuming that all digital word of mouth mentions are equivalent. A prominent post on Trip Advisor or Yelp may get a lot more eyeballs than a similar comment on a small, localized travel site. In that way, digital word of mouth is the same as network TV, radio, or print. The number of people paying attention dramatically impacts the worth of the medium.

(incidentally, Internet advertising whether banners or pay per click is the one exception. You buy as many impressions or click as you want, and the overall size of the site’s audience is somewhat immaterial - one of the reasons I love Internet advertising).

For now, while I applaud the notion of putting a value on conversations online, I’ll stay away from recommending valuations or valuation methods until it shakes out a bit more. I suggest you do the same. Similar Posts That You Might Enjoy

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Rerouting inefficient markets is what the Internet does best. Wherever lack of information transparency requires regular folks to use specialists to make a transaction, the Internet will discredit and then cripple that industry. The former travel agents and stockbrokers serving your Bloomin’ Onion at Outback can attest to the Net’s unique ability to eliminate the middleman.

The next cabal of intermediaries wearing a bullseye sport coat is the buyers and sellers of advertising space and time. Today, it’s not that different from getting a rug in Istanbul or a necklace on the beaches of Rocky Point. The purchase of media shares a bunk with car sales in the shrinking barracks of business transactions where haggling is the norm.

Do print, broadcast and billboard companies have price lists? Sure, but they’re adhered to with Pitt-esque fidelity, and rarely published. Ad deals are negotiated and finalized in a tango of proposals and counter-proposals, faux outrage and coy denial. It requires two highly compensated people to seal even a modestly sophisticated advertising agreement.

It’s an inefficient marketplace that reeks of vulnerability and opportunity.

Internet advertising will tally $16 billion in the U.S. this year, and a preponderance of that lucre will go to the high flying gorillas of the industry: Google, Yahoo!, MSN – a post-modern Big Three Networks. But, the stock market-fueled requirement to continue growing like Barry Bonds necessitates the location of other major revenue streams, and offline advertising could prove to be the HGH of the online media giants.

“Our goal with adCenter is to advertise into any medium. This marketplace is begging for some efficiency in the media buying process.”
- Joanne Bradford, Chief Media Revenue Officer, Microsoft
June, 2006

The Big Three already have hundreds of thousands of customers buying ads every day, utilizing their Web-based systems for purchasing those cute little text ads that come up on top and on the right hand side of search engine results. The plan is to modify and extend that platform to enable advertisers to purchase offline advertising directly. No phone calls, no meetings over sushi, no negotiation. Whoever will pay the most for the ad gets the space, and anyone with a computer can play ball.

Taking a page from the eBay playbook (note Yahoo!’s new joint venture with the auctions king), the money isn’t necessarily in owning the ad space to be sold, it’s in taking a small piece of each transaction in exchange for facilitating the deal.

Newspaper classifieds advertising alone generated $3.8 billion in the first quarter of this year, according to the Newspaper Association of America. Just a two percent commission on that component of the offline media universe totals $76 million in commissions per quarter, and requires approximately zero overhead once the system is running.

Despite their chest thumping public statements, Microsoft is as usual already running behind in this new race to automated media buying dominance. Google purchased DMarc, a radio advertising company last January, and launched a pilot program in February that enabled Google advertisers to buy space in major magazines including Car and Driver, PC World, and Entrepreneur using a modified auction model.

By its own admission, the test was not particularly successful, and underscores why this transformation will not happen immediately. Except at small companies – not likely to be advertising in Car and Driver – different people in a corporate marketing department or ad agency are responsible for buying online and offline ads. The search marketing guy that understands Google inside and out doesn’t know the magazine market, and an auction model has all the familiarity of Mongolian goat blood liqueur to most offline media buyers.

Google will keep trying until they get it right. There’s too much money at stake to not take a long-term approach to this nascent business.

Says Tim Armstrong, Google’s Vice President of advertising sales,

“We’ve talked about the expansion into video ads, and eventually into television. My guess is for each of these major new media initiatives, we’ll have a few cycles of trying to find the right combination of advertiser product, targeting product, and business model that really takes off.”

Progress is already being made, as Google unveiled a video ad test in late May, and Emmis Radio, the country’s ninth largest station group (and owners of KKFR-FM in Phoenix) announced that they will install Google’s dMarc system in all its stations.

How long will it be before it’s common to purchase offline ads directly via a Web site? One year? Five years? It’s too early to predict when the tipping point will occur, but if you buy or sell ads for a living, now would be a good time to get friendly with your laptop.Similar Posts That You Might Enjoy

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What does the Internet have to do with your print, TV, radio, direct mail and other traditional tactics? Plenty.

Along with the oft-cited belief that half of all marketing dollars are wasted lies a corollary, which is that the traditional components of most marketing plans are evaluated using less than scientific means. In many cases, the perceived success or failure of a traditional marketing tactic such as a magazine ad is based on the random, coffee-breathed feedback offered by Lance, the knit-tie wearing sales associate that stops by your cubicle each morning to give you a blow by blow of each customer interaction. The one big sale Lance was able to make last month was to a woman who mentioned seeing your magazine ad. Thus, Lance advocates an eight-page full-color insert in the next issue since it’s obviously the best possible advertising vehicle.

In addition to Lance’s unimpeachable research, you may ask your customers via some sort of survey where they first heard about you. Numerous studies have shown these queries to be unreliable, as people either check the first box on the list, or whichever media they tend to consume most frequently.

So, what we advocate is the use of Web analytics to determine effectiveness of traditional marketing tactics.

With Internet access surpassing cable television in terms of consumer penetration rates, increasingly prospective customers consume traditional marketing messages first, and then evaluate your company via your Web site before determining whether to progress along the purchase cycle.

Consequently, as long as your traditional marketing consistently references your Web site, your online presence is a reliable surrogate and aggregator for your complete marketing program.

Here’s how to use it to figure out what works.

Public Relations

PR results have always been tough to measure. Historically, column inches of press coverage are multiplied by advertising costs for the same amount of space to derive a value. But that has no bearing on actual effectiveness of PR in driving awareness or sales. We log all media placements our PR division makes for clients by the date the articles ran and by publication. We also create a list of search terms that relate to each article.

Then, we look at the client’s Web site analytics to see traffic patterns after the articles ran, and measure visits from corresponding search terms.

For a recent client for whom we placed an article in the Wall Street Journal, we saw a 1000%+ increase in Web traffic, including many visits directly from wsj.com, and a spike in visitors using search terms mentioned in the article.

Marketing Mix

Similarly, to determine the relative impact of different pieces of the marketing plan, we create spreadsheets that plot when all traditional marketing activities occur such as TV and radio buys, billboards, direct mail drops, newspaper and magazine ads, etc. Then, we add a line graph that show Web site traffic, leads, and sales (if applicable) along the same timeline.

Anytime we see a spike in Web site results, we see what marketing tactics were ongoing at that time, and use that data to help determine which activities are most successful at driving results.

Message Impact

I’m not anti-focus group, but relying solely on research that asks people what they would do in theory puts a lot of artificial conditions on their buying behavior. After you’ve had a couple beers and if the light is just right, even the Pontiac Aztek looks pretty good.

We prefer when possible to mix focus group type theoretical research with measuring what people actually do in a low cost environment that gets results fast. We create a series of online banner ads that contain a distinct potential marketing message for the product or service, and then launch a quick online media buy that puts those ads in front of likely customers. Within just a few days patterns emerge that tell us which messages are salient. The trick to this approach is making sure that the ad creative is extremely similar except for the message itself. You don’t want to interpret a message as powerful, when it’s actually the photograph of the cigar smoking beagle in the one ad that is getting the attention.

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