Archive for 2008

September 27th, 2008

Dairy Milk gets the gorilla, but Galaxy gets the growth

dg
So, Dairy Milk with its Drumming Gorilla TV ad campaign has posted a sluggish 2% market share growth whilst ‘run of the mill’ Galaxy has romped home with a 12% growth. Research has shown that the Gorilla ad is more memorable than Galaxy activity, but clearly this success in recall does not seem to have translated into success in sales. Quite rightly, this result immediately ignites a discussion about the sales value of creativity. You can get into some of that here.

Not entirely unconnected to this is the debate that took place on the 4th August at the IPA - “Who makes better planners? Planners or creatives?” Veteran creative Dave Trott and planning sophistocrat David Golding battled it out with Trott arguing that it’s time planners got back to building sales rather than using advertising “to provide a window on a brand’s soul and to build the brand’s ‘equity’ in people’s minds”. Golding defended the principle of using the brand as a source of insight, and quite valiantly by all reports.

I’ve worked on projects with both of these characters, with David Golding on an existing client account at WCRS and Dave Trott on a creative pitch at WTCS (as was). Dave Trott worked in an interesting way. He did his own planning in his own mind, based on very considerable experience. His approach was intuitive - he visualised the target audience as people he knew (in this case his mother and her friends) and asked himself what type of message would engage her. Then he wrote those messages down and turned them into a visualized campaign for TV and press. Trott’s campaign was a distillation of the communication problem, solved, simplified and then visualised. Dave Golding on the other hand was measured, considerate, analytical and logical. He’d be as likely to base a campaign on what his mother thought as a judge would be to discuss a legal technicality with a courtroom security guard. The work that resulted was memorable and strong. So here’s the question - if the insight for the Dairy Milk Gorilla campaign were to have originated from the grey matter of either Golding or Trott, which would it be?

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September 18th, 2008

Is Google Marketing’s new Yellow Pages?


For many years Yellow Pages had an interesting, if not pole, position in marketing performance reports. Whilst many communication and media channels would deliver a cost per sale of £X, the Yellow Pages always topped the report, often with a CPS of a 10th of £X - or even less.

Why did it do so well? Not because it had any magical qualities as an advertising medium but because it because it was the first calling point for many consumers wanting to find out more about an advertised product. When calling a call centre, the operative might ask, “And where did you hear about AB Financial services?” to which the caller would respond, “In the Yellow Pages”. This Yellow Pages source would then be duly logged in the call data for future agency evaluation. Let’s call this “Yellow Pages Syndrome”

Google is now increasingly performing this “first port of call” function in marketing activity, particularly in non-retail services marketing. The result is that when brand terms are measured in pay per click campaigns they can perform extremely well. Conversions on PPC brand search terms for product X can come in at less than 10% of the cost per conversion on generic category terms. Think “Atco lawnmowers” versus the generic “lawnmowers” for example. “Atco lawnmowers” may deliver a cost per conversion of less than £10, whilst the generic “lawnmowers” may produce a cost per conversion several times higher.

Informed marketers always knew that Yellow Pages was only the “receptacle for response” not the originator of the response itself. The problem was that Yellow Pages was very difficult to measure, all we had to go on was the circulation or distribution volumes in each book’s catchment area. This figure was flat over the whole year and no daily or seasonal readership reporting was available. As a result is was almost impossible to form robust causal linkages between advertising activity and Yellow Pages response. But Google’s daily level reporting across all purchased PPC terms including factors such as response, conversion and key page visits (through Google analytics) means that we have enough data variation to examine those linkages. And, lo and behold, the data clearly supports the idea that advertising drives brand searches.

The fact that advertising and direct marketing drive Google brand term searches means they now have a new metric against which they can be judged. Advertising and direct marketing that produces Google searches can be driving some of the lowest cost sales a business is likely to make - -provided Google searches driven by these channels are correctly attributed. So whilst online and offline, Google and other techniques may appear to be competing against each other, they are in fact enjoying a harmonious and synergistic relationship.

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July 27th, 2008

Can direct marketing live without the electoral roll?

There’s a lot of noise around the new recommendations about restructuring or even banning the use of the electoral roll. The government seems to think that the commercial exploitation of the UK’s voter roll has now gone far enough. This is probably driven by a number of factors ranging from privacy and data security issues through to green considerations. There’s no doubting the fact that data security is rising up the agenda as more and more seems to get lost, and from the green perspective, the DM industry uses vast amounts of paper which for the most part (around 95%) ends up either in the bin or recycling boxes.

In return, the DM industry is having to argue that it needs the electoral roll to produce targeted advertising and to clean and validate mailing lists. The industry is also drawing attention to the fact the local authorities earn income from the sale of electoral roll data.

I find myself torn two ways. As a direct marketer I relish the ability to reach highly targeted individuals with a relevant and timely piece of communication. But on the other hand, I can’t help feeling a sense of shame at being associated with an industry that pushes thousands of tons of unwanted paper through peoples’ letter boxes.

I think the reality is that DM is overused as an acquisition medium. And it’s not as though the direct marketing industry is short of communication channels for acquisition marketing. Alongside print and broadcast, digital media now offers direct marketers a communication channel that has all the right characteristics and none of the negatives: it is highly targetable, it puts consumers in control - they get the information they want when they want it and finally, online direct marketing has to be greener than paper based direct marketing. I sense that the government understands these factors and finds itself having to try ever harder to push a recalcitrant body in a new direction.

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June 26th, 2008

What’s the future for call centres?

For many years, even decades, call centres have been the primary recipient of response to consumer advertising campaigns. Throughout the 1990’s call centres were able to grow on the back of a strong growth in response-seeking advertising and marketing. In the last decades of the last millennium there was significant investment in call centres, technology and people.

However, as we entered the new millennium, the internet emerged as an alternative recipient of response. Now, as broadband penetration has increased to critical mass, online interactivity has become the norm and many companies are driving huge volumes of response to the internet. These developments open up a debate about the future of call centres with their significant costs in terms of buildings, communications, technology and people. Marketers are asking: What is the future of the call centre?

I found some interesting research on this topic from Forrester. Forrester asked 176 large US firms (turnover of $500m+) to forecast how the saw the way they interact with customers changing over the next two years.

The big gainers are web and email, whilst the big loser is call centres. 96% predicted a significant increase in the use of the web and 80% saw a significant increase in the use of email. Virtually no companies saw a reduction in these online interaction channels. At the other end of the spectrum 28% saw either a small or significant reduction in the use of call centres whilst only 17% saw significant growth prospects. Phone self service was tabled for a 69% increase suggesting that whilst these firms recognise that there are many consumers who still want to interact by phone, they are not necessarily prepared to pay for that to be a live conversation.

It looks as through live call centres are in for a tough time; they’ve lost their historical monopoly on non-retail interaction with the consumer. Companies are going to see very tempting cost savings in online interaction so they’re likely to encourage and invest in it. I think they’ll always be a role for live call centres, though much reduced and focused into the type of high value conversations that justify their relatively high costs. Live conversations are likely to be increasingly reserved for high value products, high value relationships and high value customers.

Forrester

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June 9th, 2008

What is Web 2.0?

Requests for a definition of Web 2.0 are still made by clients - for some this is still a new subject. Here’s a summary of the points I recently used to describe Web 2.0 to an FMCG advertiser.

Web 2.0 is an inclusive phrase that covers the new web based networking, customisation and data management functionalities that have emerged since 2000. 2000 is a significant start point because it played host to two important events in the gestation of Web 2.0. First, 2000 was the year of the dotcom crash which, in an almost Darwinian sense, extinguished poor performing technologies and ideas and created the intellectual, technological and financial ‘space’ for something new. And second, 2000 was the year that Google began real take-off after receiving $25m of venture capital in 1999. This investment paved the way for Google to expand globally and redefine the way web information is catalogued, ordered and retrieved worldwide.

It’s important to note that the web as a technology platform remains largely unchanged, but in Web 2.0, the way that platform is being used has changed dramatically. Web 2.0 is about moving web content from being information on a news stand to being customised information solutions for individual needs. This individual customisation is the essence of Web 2.0. The guys who coined the phrase Web 2.0* cite a number of examples to illustrate how Web 2.0 is an evolution from Web 1.0. Here are two examples that really sum it up:

1) Encyclopaedia Britannica versus Wikipedia

Britannica was - and remains - an online encyclopedia written and researched by the Britannica editorial team. It’s a huge compendium of information, but it remains under the tight control of Britannica. Wikipedia on the other hand is open to editorial contributions from almost anyone at any time. It is therefore never the same across any two days. That makes it a living and evolving entity. Where Britannica is ice, Wikipedia is water. Britannica is Web 1.0 and Wikipedia is Web 2.0.

2) Personal Website versus Blogs

Personal websites are generally static and non-interactive. Content is uploaded, pages are then fixed and remain unaltered unless the webmaster decides to make changes. Change is cumbersome, requiring changes in HTML source code. Blogs on the other hand are a platform designed to have content updated frequently. New content can be posted every minute and uploaded from PCs or mobile phones. Readers can air their views by posting comments. Content can be emailed to others. Blogs can be “claimed” at Technocrati where all registered blogs are brought together in a searchable blog universe or blogosphere. Personal Web sites are 1.0 and blogs are Web 2.0.

Other ways of defining Web 2.0

There are other ways of defining Web 2.0. Think of drinking in a highly social pub rather than having a glass of wine at home alone. Think of videoconferencing rather than watching the TV. Think of CB radio with its network of “breakers on the side” rather than a one to one linear telephone call. Think in terms of the Internet versus the printing press or conventional TV versus You Tube. Web 2.0 is Facebook where 1.0 is a printed membership directory. Web 1.0 is one dimensional, non-network based, comparatively static and delivered to “mass” online audiences. But Web 2.0 is about being multi-dimensional, connected, highly dynamic and delivered on a customised one to one basis.

What are Web 2.0’s component parts?

Web 2.0 is many things and the list is potentially endless – there are already about 9m references to it in Google. Even the guys who defined Web 2.0 had to say “Web 2.0 doesn’t have a hard boundary, but rather, a gravitational core”. Here are some of our examples:

Blogs / Blogosphere
Broadband
Comments
Communities
Content
Databases
Democracy of information
Facebook
Google
Google Adwords and Adsense
i-Tunes and i-Pods
LinkedIn
Networking
Tags
The “People who bought this, also bought this” feature in Amazon (A web 1.0 survivor)
Technocrati
User Generated Content
Widgets
Wikipedia

These examples are component parts of a totally new media age. It’s a new form of media (indeed media may no longer be the right word) with a new set of rules, a new language, a new functionality and it’s a world that puts the consumer, as the scheduler, at its core.

* O’Reilly Media and MediaLive International

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May 6th, 2008

Does offline advertising drive online site visits?

Many advertisers are asking whether offline media drives their online traffic and to what degree. I recently had to review this for a major blue chip advertiser so I thought I’d share the sources and results I’ve found:

1. Jupiter/IPSOS Study
Jupiter and IPSOS got together in 2007 to survey 2,000 US web search users to analyse what drove them to make web searches. The Jupiter/IPSOS research found that 37% of respondents claimed they had searched in response to a TV ad, 30% had searched as a result of seeing a newspaper or magazine ad, 17% had searched after hearing a radio ad and 9% had searched after seeing an outdoor billboard ad. These results were higher amongst “daily searchers” i.e. people who say the use search engines at least on a daily basis. For example the percentage of daily searchers quoting TV and press/magazines as an influence climbed from 37% to 44% for TV and from 30% to 35% for a magazine ad.

2. PPA / BMRB Study
The PPA, a trade body representing UK press and magazine titles, undertook a survey of 3,045 online adults aged 16-64 during August 2007. The research found that 70% of those surveyed had visited a web site as a result of seeing offline communication and 58% of online adults have made a purchase online as a result of seeing offline messaging. When asked, “Which of the following have triggered you to go online when looking for information on products that you have considered purchasing?“ the responses were as follows:

TV - 50%
Magazines - 45%
Newspapers - 31%
Radio ads - 17%

3. Retail Advertising and Marketing Association / BIGresearch (US study)
The Retail Advertising and Marketing Association (RAMA) undertook research with BIGresearch in the US and surveyed over 15,000 consumers in its Simultaneous Media Survey. This project found the top 10 media that trigger an online search (Adults 18+) to be:

51.6% Magazine
47.7% Read an Article
44.2% TV / Broadcast
41.3% Newspaper
35.6% Cable TV
35.3% Face-to-Face Communication
33.8% Coupons
30.3% Email Advertising
29.3% Direct Mail
28.2% Radio

4. Hitwise Media Impact Report
This report contains good case studies from the AA, Orange and Sky. Key take outs are firstly that integrated campaigns drive greater levels of search volume and secondly that product specific advertising in offline channels e.g. press can have a positive uplift effect on the search terms that reflect the product being advertised in that offline channel.

Understanding your own traffic sources
All brands have their own DNA and industry and category level research will only give you an indication of how offline media might drive online traffic to your web site. Only a bespoke analysis using your own media data and search/web traffic logs will help you to understand how offline media drives traffic to your site.

There’s no need to get into intricate modelling to reveal these relationships. Most statisticians will begin even the most complex analysis by simply plotting media activity looking for patterns. Try plotting your media activity (e.g. spend, impacts or GRPs) and search traffic volume data (only relevant terms) into charts and observing the patterns. This may be sufficient to illustrate whether offline media is driving traffic to your site.

Your analysis will be much stronger if you are able to strip out all referred traffic and focus on direct traffic when looking for these relationships. If you use a reporting tool like Google Analytics, you can strip out all traffic source data that can be explained by other activity such as paid search, banner campaigns or link referrals. You are then able to isolate direct organic search traffic coming into your site and compare that with your media activity.

Larger brands with more complex and inter-related traffic drivers may have to undertake more sophisticated econometric modelling to isolate the effect of individual traffic-driving variables and remove the effects of underlying seasonality and brand awareness.

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