Actually 4 Thoughts On Advertising
Here are some thoughts on advertising driven by four recent reads.
What If There Was No Advertising?
Imagine a world where all advertising was erased from the environment. That means no more escalator, or bathroom stall ads; no more behavioral retargeting; movies and tv shows without commercials (oh, that’s Netflix); no outdoor boards on Montana highways, and on. Hard to visualize? Maybe (um not), to help, here is a series of “ads” that have been erased. Check out Jorge Pérez Higuera’s photo series Public Spaces.
Back to reality.
But, First The Good Old Days & ROI
I am having a drink tonight in my town San Miguel de Allende with Michael Farmer whose book, “Madison Avenue Manslaughter: An Inside View of Fee-Cutting Clients, Profit-Hungry Owners and Declining Ad Agencies” is the most informative and insightful book on the reasons for the demise of the good old days of advertising. Michael covers the advertising world from the high-profit Mad Men days to where we are today (much less-profit). Today’s ad world is strapped by client jitters, the quest for low-cost advertising services and way too many advertising platforms that equal an ever-increasing workload.
I suggest you buy the book and listen to Michael’s interview with Jack Meyer’s on MediaVillage. From the interview:
Jack Meyers: Last week we talked about the deterioration in agency-client relationships — fee cuts, shorter relationships, in-house agencies, etc. You said that agencies were downsizing and liquidating their capabilities — becoming less capable of helping their clients solve “brand growth problems.” You predicted that this would lead to financial problems for the holding companies. This did not paint a very optimistic picture of the industry. Where do you think things are headed?
Michael Farmer: There’s a difference between where things are probably headed and where they could be headed. In a funny way, I’m still optimistic about the potential for a turnaround in the industry. As long as advertisers have performance problems — stagnant brand performance, for instance — there are attractive opportunities for problem-solving partners. The question today is whether the current leaders of advertising agencies and holding companies will transform their operations and help them become the problem-solvers that their clients need.
We will not return to the good old days of 15% commissions on large TV, print and radio buys. Today we are paid by the hour and seem to need to run Instagram at a 24/7 pace.
However, it does not have to be gloom and doom. As I have written about over the past few years and council my agency clients… we need to, as Michael says, address the core need of our clients and that is sales growth – not mindless Instagram posts. In the case of 2019’s ability to track much of what we do, that means addressing Return On Investment. Yes, you better be creative art directors, media planners and database experts. But, you have to be able to recognize sales opportunities, have the time to find solutions and deliver ROI.
Advertising Is Back! Y’all. I Hope.
From a Business Insider article.
2017 was a trying time for ad agencies, with issues ranging from transparency and brand safety concerns to the looming threat of consulting firms coming to a head last year.
But the prospects for the advertising industry look a lot brighter in 2018, according to new research issued by UBS.
The investment bank surveyed 350 global marketing executives and 500 US CFOs and has predicted that ad agencies will bounce back in 2018, buoyed by a growth of 4-5% in global advertising spend.
The recovery in 2018 will be driven by a number of factors, UBS analysts said, including large advertisers increasing the scope of work with creative agencies and big sporting and political events driving increasing spend on brand media.
This is particularly interesting, as it runs counter to the trend of advertisers doubling down on direct advertising in recent years, where they have prioritized marketing strategies that drive measurable results.
So, I’ll believe this when I see it. That said, in my opinion, the ad industry has gotten way too into data and has forgotten that ideas, big ideas, drive the business. Big ideas that move sales. Data geeks beware. By the way, if you are a data geek, shouldn’t you be working at a high-profit hedge fund?
TV Is Dead.
Bob Hoffman rails against the over-hyped world of digital media. In fact, he has built a mighty fine post ad agency ownership biz on his thinking and talking. He is right and usually finds some “facts” that support his views. Last week he railed, with supporting numbers, that TV still rules the Super Bowl. Surprised that the big box wins? I’m not.
Digital Hype Machine Never Sleeps
Speaking of the trade press, a story in MediaWeek just before the Super Bowl was headlined, “Super Bowl Viewers Embrace Multiple Screens.” The story had some amazing “statistics”:
– “Nearly half (47%) of respondents will use secondary (digital) media to consume Super Bowl-related content”
– “Viewership via streaming services is expected to be up 45% from last year”
The exec VP of a digital media company had this to say, “There is no doubt about it—streaming is on the rise, and advertisers must either adapt to keep up…or face falling behind.” Ohmygod, the heartbreak of falling behind!
We return you now to Planet Earth where 98% of people watched the Super Bowl on TV and 2% streamed it online.
So, is TV dead? No, but to think that we’d rather sit through endless commercials when we can launch one of the many commercial-free options (Netflix, HBO, Amazon, soon Disney and Apple…) is, um, dopey.
Smart Ad Agencies That Get Off Their Asses To Adjust – Win.
If you run an advertising agency. Or, just work for one that should be growing, take a look at my article How A Boise Advertising Agency Went Global.
There is a lot of learning here – especially about having a compelling and competitive specialty.