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Why agencies are failing

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Take a moment to review some of the top-rated television advertising from the first quarter of this year and you'll see a weird pattern.


There is the E*Trade "One Finger" spot that lists all the things you can do with one finger, such as "save Holland" and "reallocate your entire investment portfolio to E*Trade" then "tell your expensive broker where to go." 


A commercial for Bud Light features a motorist picking up hitchhikers because they have Bud Light even though the hitchhikers appear dangerous and are carrying weapons like an ax and a chainsaw. We've all also seen the celebrity Geico commercials, which -- like the others -- are all humorous "push" advertising that expresses the brand using idioms that are, to say the least, a reach from the product.


For viewers who have not bypassed television ads with their DVRs, television advertising does not provide opportunities to connect with the brand, nor does it invite dialogue -- except perhaps, "Hey pass the remote." Consumers are leaving television and traditional media for the internet in greater numbers every year. But adware blockers and a multitude of other online tools have made it easy for consumers to avoid marketing and advertising messages online as well. What are agencies to do when every year consumers make a greater effort to ignore the fruits of our labor?


There have been few reports that have accurately described the state of our industry better than Forrester's February report, "The Connected Agency." And there is no doubt that many agencies are in a weakened position. With innumerable technological breakthroughs, a sea change in consumer preferences, interests and multiple (and increasing) different avenues to reach consumers, one has to wonder why we as an industry are doing such a crappy job. That's right; I just gave agencies a "C," which is barely worth crowing about.  


In this piece, I will take some of the observations from the Connected Agency report and apply them to real-world examples. Love them or hate them, this is where our industry is headed, so grab a helmet and get used to it.

The Forrester report makes the assertion that two-way communication with consumers and the translation of the resulting data into brand positioning for clients is the new role of the connected agency. Well, yeah! Isn't that supposed to be the real power of what we call this "interactive" media? 


Unfortunately, many brands and agencies believe they can engage consumers in a dialogue purely by producing campaigns alongside and within user-generated content (UGC) and exploiting the YouTube phenomenon. In the last year, you have probably read about the success of Doritos, Dove and other UGC contest campaigns and the controversy around the Subway/Quiznos UGC contest lawsuit. But which of these campaigns really "gets" it? How about none of them?


The details surrounding the Subway/Quiznos lawsuit again demonstrate that not all "UGC" campaigns engage consumers or are even consumer-generated. One of the Quiznos contest's finalists quoted in The New York Times makes ads in Lexington, Ky., and has participated in several national ad contests.


Having advertising professionals compete seems to defeat the purpose of engaging and creating a consumer community around your brand. When agency UGC campaigns turn into RFP responses for one-person ad shops, the consumer engagement shark has been jumped.


How lasting is an engagement predicated on winning a contest? Are consumers really engaging with your brand or simply seeking attention for their own?


I think the best example of a brand using UGC to make a connection with consumers is the Toyota World of Warcraft commercial, which was obviously predicated on the earlier YouTube hit Leroy Jenkins.


The creators of the Toyota ad did not need to hold a contest to create their UGC World of Warcraft segment. Instead, the ad creators demonstrate a strong understanding of the online gaming community and its culture by parodying the Leroy Jenkins piece. The resulting ad is an engaging, hilarious unit, and it generated enough buzz on its own to at least quadruple its media buy in terms of value. The spot was so well regarded that it was used on "Monday Night Football" and other premium showcases. The lesson here is that only by understanding the community and audience does brand-supported UGC advertising become really effective.


Lesson No. 1 -- Understand the community as a whole and the individual audience of a given campaign first before you try talking to them. Use our medium to listen first.

With interactive media firing on all cylinders, the 2008 presidential campaign has become a digital communication machine representing the future of the connected agency. From developing online community groups and issue-oriented websites to Facebook and MySpace efforts to conducting virtual town hall meetings and attending blogger conventions, the campaigns are acting like the new agency model, exemplifying integrated cross-media marketing.


The digital efforts are working well with voters, as evinced by the Obama Girl and Hillary Clinton fan videos on YouTube. These UGC "campaigns" are truly user-generated -- not the result of contests -- and have helped move these political races from campaigns to conversations. But the campaigns have done much more than inspire a few hundred UGC videos.


Interactive banner ads have made a very big impact, with millions of impressions raising millions of dollars. Although the Romney campaign was the first to use interactive streaming video format, Obama's display ads received 65 million ad impressions both in October and November, according to Nielsen Online AdRelevance. The interactive video-enabled homepage takeover display ads the Obama campaign ran in March through local media giant Centro caused such a stir that industry analysts wondered whether the ads caused endorsement confusion on the part of website users.



The campaigns have moved their marketing message to the next stage -- engaging and communicating with voters at every level. In case you are thinking national brands cannot afford integrated online campaigns on this scale, less than one percent of the estimated $1.5 billion advertising dollars spent by all presidential candidates this year will go to online advertising -- something to consider next year when your brand is considering buying one 30-second spot during the Super Bowl.

By any measure, Apple's iPod commercials and advertising ventures have become hits and star-makers by giving traditional rock legends like U2 a Web 2.0 makeover. With its multifaceted deal, Apple retained exclusive rights to sell all songs from U2's album "How to Dismantle an Atomic Bomb" on the iTunes Music Store and to market a special U2 iPod. For acts like Feist, Apple's iPod commercial featuring Feist's "1234" catapulted the Canadian chanteuse to the top of U.S. charts and garnered her a Grammy nomination. 


No matter what Matt Creamer of Advertising Age suggested in the March 17 "Digital Issue," the fact that Apple makes this kind of effort -- while making its broadcast creative look like Flash -- implies that the creative "lives" in digital and ventures out into broadcast, not vice-versa.


Consistently, Apple's iPod campaigns use new music to pull consumers to its technology and its iTunes store. Apple's slick television spots, which focus on music and not their product, give added credibility to its brand while pulling viewers online to purchase the music they heard at iTunes. The key to Apple's multi-channel success is marketing the music first, the iPod brand second, with the added benefit of promoting iTunes.


Verizon, a Questus client, also has used music to create "pull marketing" to its brand and FiOS services. Working with major acts such as Fergie and Gwen Stefani, Verizon created successful online communities around each act's tours. Each interactive community featured online fan chat rooms, tour weblogs from the stars, UGC video elements, as well as phone and texting features that allowed concert goers to post live pictures from the concert event on the community site. By promoting the music, Verizon also introduced thousands of new consumers to its FiOS technology and broadband media offerings.


Both Apple and Verizon understand that great pull advertising means giving to your consumer community first, whether it is access to new music or greater access to their favorite acts -- getting consumers excited by understanding that their interests are really what the new agency model is all about.

Perhaps the best and most subversive example of where new advertising is going comes from Radiohead. Last year, the band distributed its latest album "In Rainbows" online -- without backing from a major record company -- allowing fans to pay whatever they wanted to download the album. Then last week, the band offered fans and aspiring producers the chance to remix one of the songs, "Nude", from their latest album. The band also launched its own social networking site, W.A.S.T.E. Central. On the site, fans can communicate with each other, see videos and photos and follow the Radiohead tour.


Those of us who work at digital agencies need to remind one another that our world is called "interactive."  As such, we can provide opportunities for consumers to interact with their favorite brands within every campaign we design. Enticing and not just inviting that interactivity has to be an essential part of everything we do.

True connection -- via a consumer-centric development process -- will yield unparalleled results. Two fundamentally different projects highlight this power. We generated groundbreaking results for one traditional publisher's website by integrating both quantitative and qualitative research into its redesign. The result was a 95 percent increase in ad revenue within 12 months of the re-launch. Would there be significant improvements to revenue without the research components? Yes. But would the results be as dramatic without including the consumer-centric approach? Not a chance. How did we get there?
 
The ways in which consumers interacted with the traditional publisher's assets pointed the way. Our research made it clear how consumers access their news, and we made it easier for consumers to see those sections first when they accessed the site. Simple, yes, but it required learning the data first. We weren't left to guess at this, we knew before we did any development.
                                                                             
One of the sections that the publisher thought should be their lead turned out to be something else after our research results came in, revealing that only one percent of users started with that section. By understanding this one simple data point, we were able to ensure that we focused the site on its core content. This had a profound impact on the information architecture and visual hierarchy -- focusing on other sections that enabled the site to engage users from the homepage and provide them with a direct and enticing path to more page views.

Deeper understanding of consumers' community affiliations will lead to effective brand positioning for your clients. It is not enough to have your consumers participate at some level in discrete campaigns or focus groups -- the connected agency reaches out and participates at the onset of the work engagement.
 
But let's face it, helping brands become more connected can be expensive. In fact, over a 12 month period, a sincere investment in customer-centricity can cost hundreds of thousands of dollars or more. We know the finance department doesn't like to make investments of that magnitude without reaping a return on the investment. So, it's important to have that roadmap concretized before any engagement. The template that we work with predicts hard results every time, with improvement in key metrics such as ad revenue or e-commerce conversions within 12 months or we don't take the engagement. If you can't predict results like these with some certainty, I recommend trying another medium that isn't as accountable as interactive. Remember -- what you'll learn from listening to users is what will inform the performance of everything you do. You can either listen, learn and perform, or maybe go back to print.


Joseph Dumont is a partner at Questus.

Joey is currently the Chief Growth Officer of eecosphere, a behavioral company that applies a science based approach to story telling for mission based organizations and corporate brands. Previously, he was a Partner, Managing Director at Questus,...

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Comments

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Commenter: Barrett Rossie

2008, May 28

Joseph, that's a great article and it should be required reading for everyone involved with traditional advertising.

But I must say -- perhaps unintentionally, you're making the case for truly great creative in broadcast. In fact, in the context of the internet and today's audiences, broadcast is absolutely worthless without great creative. The problem is of course many agency directors and clients know great creative if it slapped them in the face.

Let me point to one of your examples, the Geico campaign. Contrary to what you write -- it works, and it works hard. It engages consumers. It's somewhat measurable, or at least testable. Geico sees an uptick in calls precisely when ads run. Talk about interactive -- once someone calls the number, they're talking to a live human, the ultimate in interactivity.

I believe you wrote that the commercials are "a stretch". To the contrary, mostly they deal directly with what people are concerned about. The success of the campaign ought to speak for itself, no matter what your and my well-founded leanings may be.

That being said, broadcast can only be effective these days with truly great creative. Not creative that merely has great craftsmanship. Great creative implies great execution against great strategy. The strategy must be informed by profound insights, which probably requires diligent research. All of which is consistent with your ideas.

David Kennedy of Wieden & Kennedy, who as a young art director worked on Pillsbury Doughboy of all things, once said: "We're not in the business of making commercials, really. We're in the business of making a connection." This holds true today more than ever.

Your article demonstrates that making a connection has become harder and harder for one-way communication. And more and more a job better suited for interactive media.

Commenter: Raymond Santopietro

2008, May 28

As an internet information architect, I have been watching this transition for years. Slowly attention is shifting from televion to a more interesting platform. Traditional agencies are trying to catch up, but generally do not have the ability to seperate the mentality differences. I always talk about "what brought someone to this point" on the internet, and use the thought process of the information seeker to dictate the communication pattern.
Ray
Focus Internet Services
www.focusinternetservices.com

Commenter: Tom Kasperski

2008, May 28

You raise several good points here, particularly your thought on the importance of "listening". Agencies are failing to engage consumers in the interactive space because many of them view consumers as something to be manipulated - listening is just an account planning formality. And many brand marketers are still so focused on quarterly results they won't invest in long term engagements. I once had a CMO tell me "I don't want a relationship with my consumers, I want a ROI".

Btw you might be interested in this series of posts I wrote last year on CGC and branding:
http://koolaidantidote.wordpress.com/2007/07/10/ugc-cgc-and-upcs-part-i/

Commenter: Tim Bottiglieri

2008, May 28

inspiring topic, Mr. Dumont, let's get right to the point, the reason advertising ( television, media outlets) do not connect or lose sight of the brand and consumer is because of the time / costs involved to think creatively, many of the ad houses are thinking quick kill, the thinking of, being in it for the long haul, building a client base is all but extinct, to much emphasis now is, "just deliver the product", bottom line, make a profit as quick and get out. Yes, consumers are leaving traditional television / media outlets for the internet, why, because those forms of information & entertainment are non-informative, boring, no creative expression. The internet provides quick access and to the point without listening to local corespondents sparring with each other. The consumer / people are tired of being misguided (who,what & where) loss of industry ethics, which leads people to gravitate for the get away from it all quick fix instead. Television has become creatively expressionless. Yes sir, crappy job is right. .

Commenter: Christian Markley

2008, May 28

Awesome points! Listening to the clients' needs and offering them choices...that is what it is all about. Only now, the choices can include viral marketing, social networking, seo, sem, ppc, metrics across all levels, and smo (social media optimization). Digital is here to stay - it has leveled the playing field for what was a game ruled by major conglomerates like Viacom, NBC, Fox, CNN. User generated content and cell phone video has opened the door to posting what I want to see, share, and comment on. No more companies telling me what I should watch and listen to.

If agencies don't jump on board and catch up, they will be lost. This is not an option; it is survival!