Ad Age Editor, Jonah Bloom, places his hand on the third rail of procurement

You have to respect any editor that wades into a controversy up to his hips in front of an audience that may be hostile. Hats off to Jonah Bloom, Editor of Ad Age, for raising the possibility that the role of procurement has gone too far in grinding down ad agency compensation in front of the Association of National Advertisers’ (ANA) Annual meeting in Phoenix this week (see link below).

Of course, the audience might not be as hostile as one thinks. It is, after all, composed mostly of the Chief Marketing Officers and other marketing executives at the country’s leading brand marketers, and the attrition of trust and resources over the past 20 years has affected them, particularly.

I won’t bother to look it up right now for it is known generally anyway: the average tenure of a CMO today is – well – stupid short. I imagine, in fact, that if the video had panned the audience during Jonah’s remarks, you might have seen many a tough marketing man or woman discreetly dabbing away the tears of emotion and relief.

It’s okay, everybody. Let it out. It’s time.

http://link.brightcove.com/services/link/bcpid1370868150/bctid50051848001

Calling all advocates!

I am waiting for a new report from Forrester Research that Ad Age says is due out this week that will offer insights on how brand marketers should behave in the digital world. According to the Ad Age story, the guts of the report will focus on familiar themes about the need to be faster and more nimble, and the need to be open to new sorts of partnerships, especially with the media, that are less reflective of the long-term ad agency associations that are industry legend. A summary observation in the report is that “Brand Managers” should be re-christened, “Brand Advocates,” which is an interesting point, and the one that most caught my attention.

I remember Stu Upson, the CEO of Dancer Fitzgerald Sample, the ad agency in New York where I first worked after graduating from college, addressing the New York office in a rare all Company meeting to talk about the loss of a major client. I don’t remember all the things he said about the client loss, but I remember what he said about the business of advertising. He said advertising is not about giving consumers the information they need to make an informed decision about products they buy – and he used the word “bunk!” to underscore his objection to that notion. We are advocates, he said, along with our clients, of their brands. We are advocates.

There’s a bit of the “so-what-else-is-new” to me, then, in Forrester’s recommendation that marketers re-brand “Managers” as “Advocates”, but fine; Perhaps what Forrester is sensing about the current state of brand marketing is an urgent need for advocacy given the amount of change that has occurred over the past thirty years, and given that in the violent tumble of new media brands are losing track of their audience and audiences are losing track of brands.

Online we are doing a lot to push the value of brands – media brands, that is – away. We seem to imagine that we can distinguish between the value of media brand relationships and consumer brand relationships. We think competing for brand advertising is desirable, but dependence on media brand relations in order to do so is not. That’s a significant disconnect. It implies that the context of things – and all brands are contextual – matters only part-time. Bunk! If the relationships that consumers have with particular media brands are irrelevant then the relationships they have with all brands are irrelevant. Also bunk, of course. Brand relationships matter. Context matters.

Context has simply improved and multiplied. Call it fragmentation. (Everyone else does.) The media world has fragmented. So what? The consumer products world has fragmented, too. I stood in line at Starbucks this morning. Fortunately, by the time I got to the register I was chatting with my wife on the mobile telephone and had her to walk me through the choices. The coffee business is fragmented. Who would have thought it could happen?

All of which is to say that Forrester may sense the urgent need for Brand Advocates in order to weave back together the fragmented pieces of their brands and brand relations. Happily, the media world is configured to help. It can segment reach against the normal Joes that just want coffee and the other Joes that want Grande Cappuccinos. And, it can do it in the context of those relationships.

A few more media brand advocates to join the consumer brand advocates and we should be good to go.

Even if OPA publishers won’t listen to Jim Spanfeller, there are many others online that will, if invited.

You can say this about Jim Spanfeller, the outgoing CEO of Forbes.com: he’s straight-forward. There’s very little ambiquity in his piece in Paid Content yesterday, titled “Publishers Are Killing Web Advertising’s Potential With Misguided Pricing,” which concludes by saying “When it’s all said and done, there really is no remnant inventory on the web, just as there is little to no real remnant inventory elsewhere.” Jim is exhorting web publishers not to give away value by entrusting it to the “invisible” hand of third-parties.

Jim is Chair Emeritus of IAB and Treasurer of OPA, and - knowing that -we’re conscious that his exhortations are largely directed at the branded media-types with whom he spends most of his time. But his message applies to all serious web publishers, not just OPA publishers, which is why the OPA could help itself and many others by acknowledging the content value that extends deep into the long tail of the Internet. It failed to do this with its recent study “Improving ad performance online” (about which there has been plenty to say in this space) and Jim slipped past the chance again in his Paid Content commentary yesterday when he said the OPA study ”shows the far greater value in buying ad programs directly from publishers” - a problematic, and somewhat suspicious claim to the vast majority of publishers online without salespeople of their own.  

Buying directly from publishers is not a media value proposition. Buying the value of content, and the audience it attracts, is a media proposition.

Jim Spanfeller is deeply committed to media value and were he invited to speak right at this point he (and possibly also the agents at OPA responsible for their recent study) might hasten to add to his comments that yes, yes, of course, it’s about content and the audience it attracts. But, he’d argue, ad networks and other third-parties aren’t capable of that for publishers. Indeed, in most cases, they are prevented from doing so because they are restricted from guaranteeing web sites and positions. Many of them are blind. So, selling the value of the web site is actually antithetical to their offering and they, along with participating publishers are “killing web advertising’s potential.”

Indeed, it’s a shame, but as it turns out the online system has evolved with a built-in value cap; a governor that keeps the Internet motor from racing.  And, it’s hard to rail against those market forces as Jim Spanfeller is conscientiously doing in order to remove the governor and change behaviors. 

To succeed, you need leverage which has been the point in taking aim at the OPA study released two weeks ago that failed to differentiate among ad networks, or other third-parties that sell value, or offer a nod to thousands of independent web publishers who don’t have their own salespeople, but surely have their own audiences! These publishers can provide leverage to the media value argument online with their passion - as partners, members of a branded content network, or simply (affordable) dues payers.

It’s been said here to anybody who will listen: imagine an OPA (or IAB, or party-to-be-named-later) Annual Meeting 10 years from now with 10,000 people attending, mostly publishers. Think MacWorld. Maybe the Javits Center in New York will hold them. All of them excited to be there to talk about publishing issues. All of them with stories to tell about how their web site is different  and makes a difference. All of them intimidated by the very big Time Warner booth with an invitation over top that reads “Be Part Of The Biggest Content Network in the World!”; all of them whispering as Tim Armstrong walks by; all of them standing in line at the Google booth (“Why Paid Search Still Works For You!”); all of them sitting with their arms folded across their chest listening critically to the panel of senior ad agency executives talking about partnership and performance. Maybe twenty-five hundred of them in the audience blogging and Tweeting and whatever-elsing as the Global Agency Director General of All Things Bright and Beautiful rumbles on about the importance of partnership and performance “with all of you of who are so closely connected to the audiences online that are our most important customers.” 

That’s leverage.

Even if OPA publishers won’t listen to Jim Spanfeller there are many, many others that will. And they can help, if invited.

The Online Publishers Association: still driving with its foot on the brake.

The Online Publishers Association(OPA), the trade association representing the digital interests of mostly offline media companies, opted to set fire to the forest floor yesterday with the release of a study on brand advertising metrics that, by the time they finished, scorched the effectiveness of the entire Internet as a brand medium save for its 50, or so, members who served as the “proxy for content sites” in the study. That means all the other non-proxy content sites served by ad networks or sales representatives, plus portals – or, basically, the remainder of the Internet - were voted off the island by the report.

There are 400,000 words in the English language and there are seven you can’t say on television. What a ratio that is, the great George Carlin once observed. Add to it, now, that there are 10 billion web sites on the Internet and only 50 on which you can advertise your brand successfully.

They must be reeeally goood.

Unfortunately, this is a problem for anyone rooting for the Internet to get to $50 billion, which many people seem to be doing. If  brand advertisers can only hope to be successful on OPA web sites, the $50 billion means that, a) they will pay through the nose for advertising on the reeeally goood sites, and b) the rest of the Internet will be awash in so much fakevertising it will be like spilled oil on the beach. (Which Yahoo! already thinks is like spilled oil on the beach and is trying to clean up on its sites. Which is not what needs to happen if CPMS go to $250 on OPA sites and you need enough room for an environmental disaster to support the rest of the economy.)

This is what lashing out looks like. The OPA didn’t release a study yesterday; the OPA lashed out at the industry, which it feels conspires every day to wreck the value propositions of its members who are important, dedicated, hard-working, First Amendment freedom fighters that are sick and tired of being trampled by midgets. Honestly, I think they are just that frustrated. Every day it’s attack of the killer ants. Every day it’s a nightmare of compromises and conditions and unwelcome intrusions:

“Another Ad Network to see you, Sir.”

“The local residents have asked if they may hunt on the grounds tomorrow, Sir.”

“The gentleman in the portal next door has asked if he might borrow some Grey Poupon.”

No one is confused about the OPA’s mission: countless years and considerable wealth and innovation went into building the global media franchises that the OPA mostly represents, and keeping them secure amidst the torrent of new media brought on by the Internet is an important and worthwhile assignment. They should be beacons. But we must live in the real world and the real world online isn’t confined to a city block. It isn’t a gated community. It just isn’t. Look up.

The OPA should be the representative for all quality content online including content touched by ad networks and rep firms. It needs to get over the “branded” content thing and identify with millions of consumers online that have abiding relationships (some might call these brand relationships) with plenty of sites the OPA has never heard of. The IAB is wisely reaching-out at a critical time to long tail, independent publishers. The OPA should be ahead of it. The OPA, informed by the centuries-old mission of its founders - themselves small, independent media pioneers – should be the principal steward of online content and quality and a fierce advocate for publishers, big and small, that work hard to create meaningful destinations for consumers. The OPA should be filled with empathy, not petty rivalry.

If so, the OPA’s study yesterday might have offered cover to brand advertisers desiring to allocate more money online in response to all the signs that proclaim that’s where the people are! Instead, the OPA said “No. Mine,” and helped keep the brand advertising promise of the Internet down. In the process, for the day at least, the shift of brand dollars regarded as essential to the future of the industry was postponed. Again.

Striking value into the hearts of buyers and sellers online: $25 billion more might just do it.

 

Media Post reports that Dave Zinman, VP and GM of Display Advertising at Yahoo!, was talking about “signals” in his presentation to the OMMA Behavioral crowd in San Francisco this week. Dave is a long-time player in the Internet space with plenty of experience to inform his signal calling. With his view of history he postulates that the first $25 billion of Internet ad spending – about where we are now – was driven by search. I’d agree. It’s been essentially $25 billion of clicks and actions thus far.

Dave signals now that the next $25 billion will come from display advertising wherein the value of the impression, not simply the click, will matter most. Yes. For one thing, we can’t be sure there are $25 billion more in clicks and actions available online. The Internet would have to be intergalactic in size, or action rates would have to substantially increase, which is unlikely; consumers are just not that into advertising.

But there is no dispute that the Internet is a staple in the daily media diet of people worldwide. Other media are shrinking, therefore Internet advertising should grow. So if there is $25 billion more in ad spending on its way, how will it be accepted and provided for?

Again, who would welcome $25 billion in additional click and action driven advertising? Under those circumstances, if the Internet were an ocean you would be able to walk across it stepping from one flashing banner ad to the next. You could set the water on fire, which is probably a fair description of the reaction consumers might have to such a polluted environment.

Impression-driven advertising will be the only way to absorb the next $25 billion. Advertising that counts for engagement. Advertising that must, therefore, be creative and compelling (like some of these from this year’s Cannes festival). Advertising that is intended to woo 100% of the audience, not just .5%. Advertising that is efficient. Advertising that can then be bought in units of one thousand impressions at a time. Advertising that can scale without deforesting the landscape, or drying-up all the wells or burning the ocean.

Which must be what Dave Zinman is concerned about from his vantage point at Yahoo!. As he reports, portals got into the advertising network business a few years ago and vacuumed-up all the reach they could get. But impression-based results were never on their mind as part of that initiative. Impression-based results belonged to the people selling Yahoo! homepages and sponsorships. The ad networks were all about clicks and actions and as the market grew and a desire for action rates led to a desire for more action rates even the portals didn’t have the reach to accommodate the results. They needed networks.

Now what? Dave Zinman signals the future: the next $25 billion is going to have to be about the value of impressions. Tim Armstrong may be signaling the same thing at AOL with the dissolution of Platform A and a renewed commitment to selling content and brand.

There has to be something that strikes value into the hearts of buyers and sellers online after all these years and maybe the next $25 billion is that thing.

What the heck is Display Advertising, anyway? And who cares?

It’s mid-year ad forecasting season. ZenithOptimedia and PricewaterhouseCoopers have both issued outlooks that could be described as cautiously optimistic. Once more online is expected to float slightly higher in the water than traditional media. Again, however, online is a mixed bag. Paid search will grow the fastest. Social networking will also grow. Video is reportedly still just around the corner according to analysts. But display advertising will shrink - at least according to PricewaterhouseCoopers.

It is a wonder anyone can arrive at an overall picture of the health of the business with all the separate ups and downs projected within our industry. Why is it important to differentiate among advertising formats as if they were businesses unto themselves? With regards particularly to “display” advertising, what are we talking about? Banners? Leaderboards? Do the OPA’s new, larger ad units qualify as display advertising? Yes? No?

Why is video not display advertising, or visa versa? What about in-banner video, is that display or video? Expandable banners…what are those? Is rich media display advertising, or is it different? Or, does it depend?

Is display advertising inclusive of behavioral targeting? Behaviorally targeted video is not display, I assume. Are behaviorally targeted leaderboards display? Probably. Paid search display ads such as Google is keen to foist upon the world: is it display advertising or paid search? What exactly do we think social network advertising will look like as distinct from display advertising?

Of course, whatever it is, who cares what happens to display advertising? Really, let it wither and die. Should we not be agnostic concerning ad formats and delivery? Arguably we should do everything within our power to ensure that video emerges as the standard given its ability to compete with the sight, sound and motion of television. Of course, it might remain as hard as it is today to populate the Internet with good video content capable of supporting good video advertising. In which case, what is the problem with in-banner video which seems especially user friendly, except that it might start out life each time as a banner?

Possibly, the pretzel logic that has us examining individual species of advertising within the online media animal kingdom has its roots in our temptation to bite the apple way back when in hopes of - well, you know, knowledge. The Ad Age story on PricewaterhouseCooper’s ad forecast quoted Alistair Beattie, head of strategic planning at AKQA London, saying something in that regard:

“Banners have been sold as a media where effectiveness can be directly measured by a click,” he said. “If posters were measured by the number of times people reached over and touched them, they wouldn’t be used. If you measure banners by clicks alone you are missing a trick — we’ve made a rod for our own backs.”

A rod for our own backs, indeed. All this energy on which ad units and formats are likely to trump the other, like one is the key to the door leading in - or out. How about let nature take its course? Says Ad Age again about Mr. Beattie:

“…Mr. Beattie said banners should be measured through a process of noticing the effect on how consumers feel about a brand. He also warned that it’s early. “People talk about the internet as just another media channel, but it’s not — it’s a social revolution, and the industry is still relatively immature.”‘

More metric madness.

On the heels of Al Ries’s ”Metric Madness” commentary in Ad Age yesterday (see previous post), comes this from Zephrin Lasker in the online trade, Adotas: “Online branding in the age of performance.” Performance today, says Zephrin, is a cultural imperative, woven into every day life. Accordingly, he asks:

“Why should it be different in the world of online advertising? Why can’t our executive teams and clients expect better performance from our branding campaigns? Why should branding campaigns be insulated from the demand for better performance and higher ROI?”

This is where we get distracted and off-track with the whole advertising accountability question, particularly as it regards brands.

For starters, who says that branding campaigns are insulated from performance and ROI?  Brand campaigns are not launched into the advertising ether without goals and objectives, and there are plenty of tools with which to measure performance against those objectives.

But consider also:

Brands are a collection of promises: quality promises, service promises and price promises. If a brand promises one thing and delivers another, the brand suffers and the customer suffers. This is the primary performance burden of brands. And, to Zephrin’s point, they carry that burden with them to work every day.

The burden of brand advertising is to remind customers of brand promises. To do this, most brands – especially big brands – have to reach many people, perhaps millions. Take Tide detergent, for instance: I heard once that Tide sells about 500,000,000 units of its product(s) each year in order to fulfill it’s promises.  At an average action rate of, say, .006 if Tide’s sales depended exclusively on the sort of direct action implied by performance advertising advocates the online world would have to come up with slightly over 8 trillion ad impressions. Maybe less, considering that 12% – 15% of Tide’s customers account for most of their sales. Regardless, long before we reached those levels of exposure customers would be dumping Tide out the windows. More advertising is not the answer for brands.

I own an Acura TL. Before I owned an Acrua TL I was mostly unconscious of other TLs on the highway. Driving the TL home from the dealer the first day, and as I have driven every day since, I am amazed at how many people drive TLs. This is something brand marketers understand. It is the same thing with brand advertising. Before the TL, I saw no TL advertising. Since the TL, I see it all. This is branding. I have 56,000 miles on my car and I plan to make it last another 100,000, or three to five years. All the car buyer opportunities in the world don’t add up to all the car owner opportunities in the world, but there will be very little performance in the advertising that washes over me from Acura until, maybe, 2012.  Is their money insulated from the demand for performance?

No. Measured in units of one-thousand (CPMs), brand advertising is wonderfully efficient way to reach customers, over time, with a reminder of brand promises and smart choices. Nothing is best left to the last minute, as my father used to try and teach me. We’re not going back to the store to get Tide for weeks. We’re not buying another car for years. If marketers save advertising for those last possible - in-market - moments so as to try and connect the financial dots more securely they are only insulating themselves from reality.

IAB Annual Meeting: Brands Battle Back.

I have always been bothered by the fact that the Internet’s leading trade show is called “Ad Tech.” The name has implied from the start that the value proposition of our industry would be in the tools of our delivery, and it has led to a gum ball rally sort of race for one-to-one audience connections brought about by data and measurement. The result (no pun) today is a business heavily reliant on direct response, or performance-based advertising which is the only iteration of the advertising trade capable of holding-up the proposition.

The IAB’s annual meeting kicked-off yesterday with the theme, “Brands Battle Back”, and a call from IAB CEO Randall Rothenberg and Chairman, Wenda Harris Millard, to move beyond the immediacy of direct response and to invigorate the art, not just the science, of our business. Entering into our 15th year (roughly) as an industry, perhaps it is dawning on us, then, that our value proposition isn’t simply in the technology - any more than it is in the technology of other media. Audiences, after all, do not sink into their chairs at night to marvel at the fact that TV comes to them via a satellite in orbit over earth. Radio, still a miracle, is meaningful only if you like what’s on. Newspapers, delivered at enormous effort and expense (and also by satellite in cases), sell only if people are moved by the headlines.

The Internet is a marvel of content. Audiences respond to content. We need to sell the content. Internet content overwhelms the competition.

The IAB’s media partner for it’s annual meeting, Advertising Age, carries this story on the front page, today: “Guess which medium is as effective as ever: TV”. It sites evidence that TV advertising works and its effectiveness may be improving. The story reminds us that measurement and effectiveness as media value propositions are not unique and not high ground. If we want to challenge TVs dominant position on media plans today we must offer the chief reasons for why people would rather be online – and technology, measurement and effectiveness aren’t among them.

Time to battle back.

A Manifesto on Interactive Creativity

IAB CEO, Randall Rothenberg, has given us an exceptional treatise on the current state of advertising creativity online: http://www.randallrothenberg.com/2009/02/heartbeats-and-mouseclicks-manifesto-on.html

Randall’s column is not simply about the business of producing great looking ads, however; it is about recognizing and extracting advertising value online.

It’s a great read. Well done, Randall.

Platform A: Brand Building at the Internet’s Leading Performance Network

Greg Coleman is in and Lynda Clarizo is out as head of AOL’s Platform A unit, which is the warehouse for its many digital media assets including its ad networks, Advertising.com and TACODA. Coleman is the eighth person to essentially lead AOL’s ad sales efforts since 2001. Interestingly, as a media sales person he is much more in character with Curt Viebranz, who was jettisoned less than a year ago in favor of Clarizo. It is hard to grab hold of the narrative thread here in the decision-making of CEO and Chairman Randy Flaco and COO Ron Grant. Is Coleman different from Viebranz in important ways? Did they go to Curt, first, and ask if he would consider stepping back into the role of Platform A President? I did not see any nod in the announcement to the job Clarizo did since taking over. Was it mission accomplished? Are they simply on to the next step in the difficult process of integrating all the pieces of Platform A?

I’m very much in favor of the sentiment expressed by Randy Falco announcing the change: “Greg’s a seasoned sales pro who understands that online brand building is the next frontier in digital advertising.” I assume that means the next frontier in relation to the old frontier, but I can’t think of an old frontier except for the performance driven, “risk free,” mostly CPA frontier championed and nearly perfected by Advertising.com. It has so dominated the online discussion that people have been willing to argue brand advertising is dead. Now, maybe not. Mr. Falco did say “brand building” is the next frontier, though, not “brand advertising,” so there may be a distinction being made. Looking through the Advertising.com prism I suspect the distinction would be brand advertising activity that builds results versus brand advertising activity that fails to build results – whatever that means. It can’t – please – simply mean “actions” because we’re talking next frontiers here. It could mean more traditional brand result measures such as awareness, image and loyalty. But, if it means trips to the brand web site, emails of the brand viral video, downloads of the brand widget…old frontier. Dust bowl. Nothing grows there for long.

Nor at the top of Platform A, evidently, where Lyndia Clarizo appears to be a victim of brand building at the Internet’s leading performance network.