I speak frequently at advertising industry events, and probably the single most frequent question I get is this:
“What are the biggest game changers in advertising that you believe will permanently change the way that CMO’s and their Marketing organization’s operate in the future?”
From conversations with many CMO’s, Media Heads, Agency Research Heads, etc., I see 5 big trends that will forever change advertising as we’ve known it for the past 50 years.
5 Advertising Game Changers
1. Content: More Than a Pipeline – Advertisers used to think of media plans as analogous to a “pipeline.” Advertisers produced ads, and publishers provided content, which acted as a “pipe” to pump the message to end consumers. This is an overly simplistic view of media plans; a better analogy would be content as a “trampoline,” where content provides “bounce” to advertising effectiveness.
It does so in two ways: attentiveness and context. When viewers pay more attention to content, they also tend to pay more attention to the ads in that content. So, content or programs which have higher attentiveness also drive high ad performance. Similarly, program context also impacts ad performance. Benefit consistency (sports clothes in sports programs; weight loss foods in weight loss programs, etc.) help ads outperform the same ads in content with less relevant context.
Attentiveness and context are not new concepts. But measurement of them is, and advertisers are increasingly taking advantage of this knowledge.
2. Media Planning: More than Audiences – All of the media agencies are being asked for more from their clients—more cost savings, more foresight, more analytics, but more than anything—more brand and sales impact from their media plans. This means that traditional media planning is morphing from being mostly about audience and costs—e.g. reach, frequency, GRP’s and cost per 1000, to brand or sales impact.
This has two implications. First, agencies are beginning to incorporate impact based metrics into their media plans. Instead of GRP’s, there will be “effective GRP’s,” where brand or sales impact is factored in. Second, agencies and advertisers will begin to pre-test media plans. Instead of simply looking at audience and cost metrics, agencies and advertisers will begin using simulations to look at projected brand and sales impact as well.
3. Real Time: More than After the Fact – Everything is moving digital, and one of the benefits of digital is measuring your advertising with granularity and speed.
Two examples: Currently, over 20% of display ads are auctioned thru Real Time Bidding DSP/SSP platforms. Buying audiences in real time is going to get even bigger and more granular, as DSP/SSP platforms become more sophisticated and are fueled by increasingly granular data sets.
And, audiences won’t just be bought in real time, they’ll also be bought for sales impact. Digital attribution modeling now employs daily regression modeling at the individual person level to measure sales impact by touchpoint, including by web site and placement. The move to real time is real, inexorable and now.
4. Single Source: More than Guesswork – Connecting—literally—the ads people are exposed to with the goods and services they buy—has always been deemed the holy grail. This “single source” data at the individual or household level is finally here—at scale, providing unparalleled insights into how advertising works.
Enabled by privacy protected loyalty and credit card buying data plus viewing panels and set top box viewing data, it will help agencies and advertisers understand which audiences most respond volumetrically to the advertising, which ads drive the most volume, which programs or web sites deliver the most lift, what role exposure frequency plays in driving sales, etc.
While still early in the adoption phase, single source is poised to finally provide extraordinary insight into how to improve advertising effectiveness.
5. Audiences: More than Demo’s – Digital audience buying is already focused on all kinds of characteristics that go well beyond basic demo’s. For example, re-targeting uses viewer browser shopping behavior to target future ads (I shopped for a bike on Web site X, so I see bike ads outside of site X in the days and weeks following).
The data sets used to buy audiences are getting richer and more granular. You can already buy digital audiences based on TV viewing behavior (e.g. buy digital audiences unlikely to have seen your TV advertising), offline buyer behavior (e.g. heavy category consumer who have not bought your brand), geography, etc.
The Game Changers Converge
If you’re feeling that these five game changers seem to overlap to some degree, you’d be right. While they are all different concepts, they are mutually reinforcing and, when taken together, are amplifying and accelerating changes to the advertising eco-system. For example, when advertisers launch a new campaign, within the first week they can:
- Use single source to quantify how web site content impacts ad performance.
- Measure this daily to get a read across all sites in their plan.
- Use real time bidding to bid for the most volumetrically responsive sites.
- Bid for audiences most likely to have not seen their TV ads to extend reach.
- Leverage all of this learning in their next impact based media plan.
Where to start ? It sounds almost overwhelming. Well, you can always take Muhammad Ali’s sage advice: “it isn’t the mountains ahead to climb that wear you out, it’s the pebble in your shoe.” In other words, get started small and get started now !