Marketers who prioritise digital advertising have delusions of effectiveness

The Promotion Fix is a​n ​exclusive biweekly column for The Drum from Samuel Scott, a global keynote marketing speaker who is a former journalist, newspaper editor, and director of marketing and communications in the high-tech industry. Follow him @samueljscott.

When I was in sixth grade in the midwestern United States in 1992, every kid wanted a pair of Umbro shorts. It was the big fad because football – and the associated clothing – had flooded suburban America from the UK in the eighties and nineties. However, I grew up in a modest household that could rarely afford the latest, expensive fashions.

My cool mother, seeing how much I wanted them, eventually put aside enough money to buy a pair. The next morning, I put them on and walked to school. I was nervous because I had never worn such a stylish brand and was wondering what was going to happen.

After I arrived on the basketball court where everyone hung out in the mornings before first period, all of my classmates turned to look at me. The boys from wealthy families walked over, looked at my neon, nylon shorts, and gave me high-fives. “Niiiiiiice, dude!” they said. Some of the girls I secretly liked were, let’s say, friendlier than ever before.

Yes, the things that teenagers value have always been ludicrous. Just look at the earlobe stretchers that are popular today.

Comparing the effectiveness of online and offline

Now, fast forward to 2018. Ebiquity recently released an evaluation of online and offline media that revealed a major discrepancy between how marketers perceive the effectiveness of certain advertising mediums and how effective the channels actually are. (The study was funded by Radiocentre, but the report is independent, unbiased, and fair – after all, radio is far from dead.)

First, Ebiquity found agreement between marketers and the company’s own research that the most important media attributes to grow a long-term brand are those in blue:

For each of these attributes, Ebiquity compiled sets of rankings. The first was how well marketers and agencies thought each medium achieved a goal. The second was how well each medium actually performed, according to the company’s research and internal data.

The study assigned rankings for each attribute, but here was the end result. Ebiquity combined the weighted scores to release this final list of the perceived best mediums and the actual most effective ones:

Some observations. First, it is encouraging to see that television ranks first in both sets. As I discussed in a keynote talk at FICCI Frames in India two weeks ago, TV is very much alive.

Second, marketers think that online video and social media are the second- and third-best mediums for brand building. But in contrast, Ebiquity found that the top six mediums are actually traditional ones that are always proclaimed as “dead”.

“With the exception of TV, advertisers undervalue traditional media, especially radio,” the report’s summary states. “They overrate the value of online video and paid social. There is a clear disconnect between the scale of investment in online media and the value it delivers. Re-evaluating the media mix may help advertisers better achieve long-term brand growth.”

Why offline mediums are best for advertising

In 2014, social psychology writer Kevin Simler published an excellent essay on his Melting Asphalt blog that discusses why advertising works. A summary:

“Cultural imprinting is the mechanism whereby an ad, rather than trying to change our minds individually, instead changes the landscape of cultural meanings — which in turn changes how we are perceived by others when we use a product. Whether you drink Corona or Heineken or Budweiser "says" something about you…

“In this way, cultural imprinting relies on the principle of common knowledge. For a fact to be common knowledge among a group, it's not enough for everyone to know it. Everyone must also know that everyone else knows it— and know that they know that they know it... and so on.

"So for an ad to work by cultural imprinting, it's not enough for it to be seen by a single person, or even by many people individually. It has to be broadcast publicly, in front of a large audience. I have to see the ad, but I also have to know (or suspect) that most of my friends have seen the ad too.”

When I walk through Times Square in New York City and look at a giant billboard, I know that millions of other people there are also viewing it. When I watched Tide’s genius Super Bowl advertising, I knew that millions of other people also saw it.

The consumption of mass media – and thereby advertising – in the real world is a communal and simultaneous event shared by millions of people. Whenever tragedies such as 9/11 or 7/7, or events such as the Olympics or Champions League occur, for example, almost everyone instinctively turns on the television. Everyone is watching the same thing at the same time – including the advertisements. In comparison, the internet is individualised. Billions of individual people are doing billions of individual things without seeing what others are seeing.

Due credit. Ad Contrarian Bob Hoffman surfaced Simler’s essay in a recent episode of his podcast on why online advertising does not generally build brands. This part of my column is influenced by Hoffman’s thoughts, which I believe to be correct.

In sixth grade, everyone was impressed by my Umbro shorts because everyone had developed the same brand association. Each of us subconsciously knew that everyone else had all seen the same marketing. In Simler’s argument, that is how brands are built. If I had seen a random, individually targeted online display ad for Umbro clothing in 1992, I would not have given it a second thought.

The 'cultural imprinting' process that Simler describes can happen over only traditional mass media. It is impossible to replicate on the internet because of the very nature of the World Wide Web – the communal versus individual media consumption.

The big discrepancy in marketing

Too many marketers think that targeted and individualised digital campaigns are best. Recent headlines for marketing products and ideas show that fact.

Global Web Index recently released an e-book on personalised marketing with “tips and tools to drive ROI with hyper targeted campaigns” because “today’s consumers expect personalisation”. Quora recently announced options for “behavioural and contextual targeting”. Faith Popcorn told MediaPost that “advertising is dead” and personalisation based on machine learning is the future.

Adweek reported that “personalisation is a priority for retailers”. Tapad launched a customer data platform that offers profile-based targeting”. Radius developed Radius Advertiser, which provides contact-level B2B targeting over more than 500 channels. (But what will happen to all of these technologies once GDPR goes into effect in two months?)

Marketers fell in love with individualised targeting over digital out of a misplaced fear of “wastage” – the idea that marketing to people who will not immediately make a purchase is throwing money away. But in Simler’s theory, that 'waste' is not bad.

Even those students in my class who had no interest in buying Umbro shorts were still impressed with me because they had seen the marketing as well. As Hoffman put it in his podcast, the 'wastage' is actually what makes the ads important – the fact that other people besides the target see the ads is crucial to a campaign’s success.

Digital marketers care so much about targeting that they forget about signaling – and the mass signaling over mass media is what builds brands. Is it any wonder that P&G is increasing efficiency by cutting digital media spend by 50%?

Digital marketers are irrational

On some level, I believe that digital marketers know that online mediums are wonderful at direct response but terrible at building brands. As Hoffman himself put it earlier this month, how many brands that are not web-native – such as dishwashing soaps, mustards, or beers – have been built online over the past 20 years?

I have yet to see anyone in digital marketing admit that fact. Why? I’ve got a theory.

Many in the online world claim that everyone needs to be digital-only or digital-first because their jobs or retainers depend on it. As author Upton Sinclair once said: "It is difficult to get a man to understand something when his salary depends upon his not understanding it."

If all a person knows is, say, social media, then that person will claim that social media is the solution to every problem – even if the customer-facing research and ideal media planning show otherwise. Too many digital marketers live in a Bizarro World resembling an alternate reality out of the latest season of Twin Peaks.

And that does not even take into account the pervasive online ad fraud and bullshit numbers as well as the fact that 40% of all online traffic may be fictional. Digital is becoming the marketing industry’s version of fake news. Digital is to advertising as Avril Lavigne is to punk rock.

Social media is vastly overrated

If you work in social media, you might want to notice that “engagement” is not listed as an important advertising attribute in Ebiquity’s study. A separate and unrelated report by the Ehrenberg-Bass Institute that I once obtained (PDF) also ranked the aspects of advertising that correlate with higher sales:

In this study, whether an advertisement is memorable correlates the most with increased sales. “Engagement” ranks 11th. As I have written before, getting 'likes,' shares, and retweets on social media posts does little to build a brand because a miniscule percentage of the market follows any given brand, and social media advertising rarely triggers an emotional response, increases brand salience, or remains memorable.

After all, another recent study by Engagement Labs found that “there is little to no relationship between the conversations happening on social media versus those that happen in real life”. The digital world is not the real world. I remember ads I saw on TV 20 years ago. I do not remember blog spam or display or social media ads that I saw yesterday. Ads alongside premium online editorial content are more effective than display and those within social media networks.

As I wrote two weeks ago, gun control activists and opponents in the US have been doing PR and advertising campaigns following yet another mass school shooting. Now, which is more effective – seeing this statement on a bunch of random display or social media ads or this monster billboard from political operative Claude Taylor in the real world?

At a trade event in the UK last month, GiffGaff head of advertising Abi Pearl said that TV advertising and sponsorship built the company’s brand. “Back then we thought we didn’t need TV and that we could just make content that would go viral and make us famous,” she said. “That didn’t happen at all. We were wrong.”

Human beings generally make decisions with the emotional part of our brains and then use the logical part to justify the choice after the fact. Digital marketers do the same thing in the professional world – too many are emotionally invested in a given medium and twist logic to support that preference. All reach is not created equal – the nature of the given medium itself makes a difference in terms of the strength of the impression.

“Digital” is just one collection of tools in the toolbox. Marketers need to know how to use all available tools because the best strategies consist of what to do and what not to do to solve a given problem. I would love to see less talk in the digital world about sales, conversions and CRO and more about long-term brand management. Discussion of that issue is sorely lacking.

Think about the big picture

The IPA in the UK recently released a PDF collection of The Greatest Hits of Les Binet and Peter Field. One slide in the set of insights summarises the longstanding view that a 60/40 split between brand building and sales activation is best for long-term growth:

While the specific media mix for any campaign will vary, the general rule is that 60% of ad spend should go towards the relevant channels that will grow the brand. Based on the new studies mentioned earlier, it seems that most of that budget should go towards traditional media. The remaining 40% for short-term results can be distributed over offline or online media as warranted.

And why is this 60/40 split the most effective? Here is another IPA chart from the collection:

Most campaigns over digital, in Simler’s theory, are marketers talking to audiences of one and are therefore generally best only for direct response. But direct response – even with personalisation or machine learning – will only take you so far. Mass advertising reaches mass audiences with mass messages that everyone sees that everyone else sees.

So, I wonder why we still see ludicrous statements such as this one from Stephan Croix, Pizza Hut’s chief sales and brand office for Europe, at the Millennial 20/20 conference in London last week: "We used to invest 70% in traditional media; now we're investing 100% in digital media."

That giant sucking sound you hear is masses of people going to Domino's Pizza.

After all, why did a bunch of American children in the days of En Vogue and House of Pain place such irrational value on nylon pairs of British Umbro shorts? Advertising in the real world.

The Promotion Fix is an exclusive biweekly column for The Drum contributed by global marketing and technology keynote speaker Samuel Scott, a former journalist, consultant, and director of marketing in the high-tech industry. Follow him on Twitter and Facebook. Scott is based out of Tel Aviv, Israel.

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