There is a debate that has been raging in Advertising quarters for almost a decade now - which is better Digital Media or Traditional Advertising. The fact that this question is being asked at all shows that most advertisers and institutions don't get consumer
behavior in the interconnected world. Considering that agencies are in advertising, you'd think they would get it right? Considering the declining ROI in traditional marketing approaches, you'd think marketing staffers would get it too right?
Over the last couple of years the debate on Advertising spend has centered on where the money is going. In March 2008 General Motors shocked the
traditional advertising world when they announced they were
shifting US$1.5Bn of ad spend to the digital space and while some shift towards digital has been hailed as 'game changing' most advertising spend is
still heavily biased towards traditional media. Susan Wojcicki, Google’s vice president of public policy and communications, was quoted in Digital Media Buzz as arguing that
Ad spending has not caught up with consumer behavior.
"U.S. users spend 12 hours per week online, which represents about 32 percent of their media time. However, online advertising makes up only 13.6 percent of advertising spend in the U.S."
Susan Wojcicki, VP - Public Policy and Communications, Google
This is accurate, but what is holding back the shift? Long entrenched marketing behaviors, lack of digital skills in-house, lack of agency drive away from traditional media buy, or lack of understanding of changing consumer behavior...
It's probably a combination of all of these. The fact that most financial institutions, for example, have minimal social media or mobile advertising spend today shows either a complete lack of understanding of consumer behavior, a lag in internal adaptation
of 'digital' or organizational inertia that is just too hard to shift?
I think all of the above contribute, but the real problem lies in the 'campaign' mentality. Brand marketing is very well suited to traditional media, because it is about creating a ubiquitous recognition of your brand, logo, image or message. To fit
broadcast mediums for product ROI advertisers created the campaign - really mini product or service branding initiatives designed to create recall at a time when customers are compiling their 'evoked' set of purchase alternatives. But while the
campaign worked in the 70-90s utilizing broadcast, this is no longer the case in the digital world.
The question over Digital or Traditional is the wrong question. The question should be, how do we better engage customers today so that they are compelled to buy?
Campaigns on traditional media are struggling in the one area that digital is increasingly effective - measuring ROI. Measurability is a strong advantage in the new world because the ability to understand why, when and where customers need a product or service
should be considered the Holy Grail. But traditional broadcast methods such as TVC, Radio, Newspaper, Direct Mail, and static outdoor, only work efficiently when it is a static message directed at a wide audience that doesn't need to change.
It was for this reason that Pepsi started its shift to
Direct Response Marketing this year as they moved
their entire SuperBowl TVC budget to online and social media. At the Sears Annual General Meeting Edward Lampert explained that even a major retailer is having to conceptualize a shift away from broadcast methods to much more targeted conversations with
customers, something that static media can't deliver.
"It's not just us broadcasting to customers any more, he said. "It has to be interactive, and it has to be relevant."
Edward Lampert, Chairman of Sears
Retail organizations, whether banks, financial institutions, or retailers like Sears need to understand that Brand advertising can survive and thrive with traditional media, but campaigns are effectively dead in the IP-conversation space. Companies need to
re-gear their marketing teams toward conversations, not just telling their customers a message and hoping for brand recall at purchase time.
In the next 5-7 years TVCs will largely disappear because consumers aren't watching them, why? Because we'll either be downloading or TiVo'ing and Ads won't be a part of the experience. Newspaper will shift to digital format so that ads in that space will go
from static to just like web banner Ads. Radio will survive, but perhaps be delivered differently based on subscription feed models. Billboards just like Newspaper will move to digital format also. The question over Digital versus Traditional is kind of redundant.
The way media is morphing everything is going digital, even traditional.
What marketers and advertisers need to work on is the conversation, not broadcast. It takes a lot more competency internally, and initially the cost of delivering conversation marketing is alot more expensive than traditional broadcast production. However,
the ROI in direct response, permission or conversation marketing blows anything in the traditional media measurability space away. We have the technology now to target messages at customers at the right time, across the right channel, but we're not using it
because we can't fit campaigns into this model. It's tough - but reengineering our approach to customer engagement is the only way through this discussion.
Bank marketing staffers better go back to school, and fast...