Amid the arrival of a connected car industry that many experts believe will transform automotive advertising, Nissan is tuning its media for what happens when those complex machines spew out large amounts of data.
When that outpour of information happens from hundreds of millions of cars from around the world, it will be worthless unless the business can call itself a “big data company”, warns chief marketing officer Roel de Vries. As lofty a goal it sounds for a global car manufacturer, Nissan feels it must act now or risk being relegated to the common conduit through which the likes of Google and Facebook prosper.
“We need to become a big data company because we want to connect all our cars so we’re going to get piles and piles of data about our customers,” said de Vries. “We can have an agency that works with us but we, as a company, need to build [our data capability]. We need to be very careful that we don’t create a system where all the data sits within the big digital companies… I don’t want to depend on some of the big media owners.”
The only way Nissan can get that level of expertise – in de Vries mind – is through integration. Integration of analytics between Nissan and its partners; integration of its agencies; integration of its marketing; and an integration of its media. It might not be the freshest marketing idea, but the fact that there are few success stories speaks volumes about its complexity. A complexity Nissan’s top marketer has spent the last five years trying to unravel by building up its own internal skills across programmatic, analytics, social media and data and insisting on a closer relationship with its agencies.
And with automation in advertising continuing to make waves across the industry, de Vries is mindful that it needs to further expand on those early efforts.
One “big challenge” on the horizon is how Nissan remunerates media agencies amidst its growing demand for programmatic. “That’s something I’m trying to figure out,” admits de Vries. “Because media is traditionally cost-per-thousand reached before you look at the year-on-year improvement. Whereas now we need to be far more focused on how good we are in reaching the people we actually want to reach.”
In other words, de Vries wants to pay its media agency for the results irs trading desk delivers rather than just the cost. Currently, many advertisers are given a choice be two types of models; one disclosed version that gives the advertiser complete transparency on costs and an agreed agency commission; the non-disclosed alternative guarantees the advertiser a price for media that is usually less than what they are paying now, though there is no opportunity to audit the buying, per the ANA’s K2 report.
Nissan can only make those calls if it has the programmatic know-how in-house. For all the benefits of the discipline, programmatic’s proliferation across media plans worldwide has made it easier for advertisers to have the wool pulled over their eyes if they ignore the importance of media knowledge. Without such knowledge, de Vries knows his marketers won’t be able to scrutinise the value of what’s being offered to them.
“We’re coming out of a point where the media agencies have all the knowledge and then they go and place the budgets with the media owners,” he continues. “The world of programmatic is changing all that and we need to get better because it [programmatic] cannot be a black box… we have made adjustments but I don’t think as an industry we’ve found the end model yet.”
This doesn’t mean Nissan will stop working with media agencies anytime soon. Rather, as media buying becomes more democratised, the car maker wants to have the internal skills to be able to move away from having to pay for mark-ups on media inventory, which de Vries says is “temporary and not the solution in the long run”.
“We are significantly stepping up our capabilities in-house to truly understand the models we’ve got in place and to run the analytics because it’s not only about the media placement,” he continues. “Having the skill on our side means we push for closer cooperation between us and the media agency. That’s going to create the change we need to understand who our customers are and what we want to achieve with them. You can’t have all that skill outside the business.”
One thing Nissan won’t be doing to get that level of integration is seek out smaller, boutique shops. De Vries believes it would do more harm than good to initiate such a dramatic shift, particularly given the extent he was worked with Omnicom over the last three years to tailor the Nissan United bespoke offer.
“We spend billions on advertising so to go and experiment with small agencies at this time of integration would not be the best way to go,” says de Vries.
“Now Omnicom, TBWA and the other agencies that we work with fully understand what we’re trying to do and have already invested a lot on digital and data to help us. I think these big holding companies will fundamentally change but the one thing you need to keep in mind is that in this world of data analytics size does matter…you don’t want to have many individual agencies for a large brand like ours. It’s probably not the best way for us but that doesn’t mean it’s wrong; there are different ways for different companies.”
“You can be a small shop but we need create our own data,” he feels, pointing to the role the larger agencies play in making that happen. With so much riding on the strategy it makes sense that de Vries has instigated much change within Nissan, including the structure of his own marketing teams and the way he rewards agencies.
“We did not go into big bonus structures,” he reveals. “Instead, as part of the fee arrangement we hold a percentage back of what we have as a fee at the global centre at Nissan United. You need something that motivates people to work together and the way we pay out is based [in-part] on the quality of the operation of their individual agencies but the biggest part is to what extent that they work together. The hold back at the level of Omnicom was quite a fundamental change in the work because it’s a big part of individual agencies’ profits.”
Such a move could only be possible because of the tailored setup Nissan has worked with Omnicom to build. Launched in 2013, Nissan United was formed as a dedicated shop comprised of talent from Omnicom agencies that already worked with the automaker such as TBWA (creative), OMD (media), Critical Mass (digital), Interbrand (brand strategy) and Emanate (PR). Unlike other dedicated shops at the time, the division reports directly to the Omnicom board rather than one of the agencies and is also structured around what de Vries calls a “nerve centre” that brings various disciplines together around data and digital.
If it all sounds familiar then that’s because remnants of the Nissan United can be picked out in the model Omnicom has erected for McDonald’s. “When they [the agency] were on the pitch I had to explain what we’d done,” says de Vries. “The McDonald’s model is built on [Nissan United] that we’ve built at Omnicom.”
It’s all a stepping stone to Nissan being able to personalise its marketing at scale. De Vries talks admiringly about how companies like Uber and Airbnb can deliver that type of communications consistency, and has clearly been taking notes.
“The future in my eyes is one-to-one marketing at scale,” says de Vries. “I don’t think many advertisers or agencies have managed to crack that. The only businesses that get close are the Ubers of this world that are dong mass communication but they are good at communicating to the individual at the moment they want to be reached. That’s harder for us as traditional advertisers because you need the data platforms and the digital platforms so that you’re able to be more integrated and connected.”