Advertising is a One-Way Street

Is it alone the only way to get the word out about your product, service or brand to large groups? Is it also the most efficient/cost effective? The answer seems to be yes to both questions with a caveat -- that it be integrated with other, deeper conversations.

Advertising has not gone away. Despite the fact that consumers -- and prosumers (thanks, J. Jaffe) -- say they have learned to avoid most forms of marketing to and at them, advertising spending by marketers is slated for big increases in 2008.

As you can see from the charts included, two of the areas where the projected increases are greater are online -- including almost (but not quite) doubling spending on advertising in social networking sites. The lion's share goes to targeted advertising. The increases are there because the results warrant them, especially when click throughs and stickiness can be measured and tracked very closely.

We like to think that we are above advertising and one way messages -- the definition of advertising on Wikipedia, says:

"Advertising is a one-way communication whose purpose is to inform potential customers about products and services and how to obtain them. Every major medium is used to deliver these messages, including: television, radio, movies, magazines, newspapers, video games, the Internet (see Internet advertising), and billboards. Advertising is often placed by an advertising agency on behalf of a company."

Online advertising does not work in isolation. I have been wondering about the role of the corporate Web site. More and more ads click through mini sites and promotional portals instead of integrating with the overall story the company puts forth. One of the reasons may be that most Web sites are static (and seldom updated) brochure ware that reads more like marketing fluff than actual solid content.

Would more companies be well served by building blogs and new media tools around online ads instead of static mini sites?

Although B2B companies are slated to allocate a greater percentage of their budgets to new media, the slice going towards demand generation and customer loyalty is still smaller than the one slated for brand building. I would like to see more movement in that direction for 2008. It would mark the beginning of greater involvement and conversation with prospects about their needs. There would also be greater opportunities for feedback built in the interaction.

With respect to audiences, millennials are leading the way due to their comfort level with using technology, entertainment platforms, user-generated content and communication tools and create a "trickle up" effect with older generations.

This is interesting to me from an anthropological angle -- it is the young who are teaching the elderly. I am also convinced that once the newer generations are on both ends of the conversation, the technology and tools will leap to newer (and more natural) uses.

According to a new media online survey by Deloitte & Touche titled The State of the Media Democracy -- out of 2,200 US consumers:

• 54% said they socialize via social networking sites, chat rooms or message boards, and 45% said they maintain a profile on a social networking site.
• 85% still find TV advertising to have the most impact on their buying habits, but online ads are second best, with 65% of consumers saying they have the most impact, beating out magazines at 63%.
• On the Internet, search engine result ads are the most effective with 78% of the vote, followed by interactive ads (62%), banner ads (60%), pre-roll ads (31%), post-roll ads (19%) and embedded ads (17%).
• 67% said they would willingly be exposed to more online ads if it meant they could receive free content they found valuable, and 65% said they found any type of Internet ad to be more intrusive than ads in newspapers and magazines.
• 37% of consumers said they would rather pay for online content than be exposed to advertisements.
• 59% of consumers said they pay greater attention to magazine ads than any type of Internet advertising, and 55% said they pay greater attention to newspaper ads.

Although marketers are planning more spend towards online advertising, print is not going away any time soon. Tim McHale at Madison Avenue Journal gave a reason why print advertising is so effective:

The physical handling and thumb-through experience contain numerous incentives visually -- be it an ad, a photo, a headline or insert in the magazine. All these sensory stimulations provide reasons to keep reading. 

In fact, it has been documented that once the reader has chosen to commit more time to the print medium, the magazine often slows a person’s heart rate down and puts the reader into a more leisurely mode, which adds to the benefit advertisers have compared to a net-based publication.

I would be curious to learn from the consultants and agencies tuned in -- what are your recommendations and are those being implemented by your customers or are marketers on the client side in the driver's seat on planning?

Comments

[Paul Soldera]

Fred Wilson over at avc.com had an interesting post on the same general topic, just a different perspective - his kids (http://avc.blogs.com/a_vc/2008/01/what-my-kids-te.html)

He also sees traditional media outlets (particularly TV and print, less so movies and radio) doing well in the coming future based on his (admittedly) limited sample.

Based on both of these, definitely wouldn't write off more traditional channels in the coming year. As you say, it's all about the combination.

[Valeria Maltoni]

Thank you, Paul. That is a very good post and commentary below by readers.

I was surprised a little about TV shows as I think that some of those, certainly not all, are being written to entertain the right kind of people for advertisers and sponsors. Then again, I do not watch TV at all. I use it and my computer screen to watch movies.