Brand owners seek new online models

29 June 2011
NEW YORK: Companies such as Diageo, Coca-Cola and Facebook are attempting to fuse heightened creativity with rigorous online measurement in a bid to maximise digital marketing return on investment.

Speaking at the Cannes Lions International Festival of Creativity, Andy Fennell, chief marketing officer for premium spirits manufacturer Diageo, outlined the challenge facing brands.

"How do you put a price on engagement?" he said, according to Marketing Week. "We need to find more accurate and contemporary ways to see if an activity works rather than wait to see if a product sells more."

Diageo has boosted its investment in digital content, marking a reversal in the cut backs which took hold during the recession.

"In the old days, we tried to squeeze these costs as much as we could. Now we are considerably increasing spending," said Fennell.

Recent schemes include a reality series on Black Entertainment Television, part of Viacom, featuring Smirnoff vodka, as well as a football-related game show running across Africa, and linked to Guinness.

The necessity for such strategies has partly resulted from evolving habits and the huge amount of content currently available to consumers, meaning cut-through is more difficult than ever to achieve.

"People have a lower attention span," said Fennell.

In a further reflection of the transformation being wrought by this new era, it has become apparent previous agency payment structures cannot survive intact.

"The client-agency relationship has changed and remuneration needs to move with these differing requirements," said Fennell.

"They have to invest in the core product that is creativity, be able to measure it and show the financial results."

Soft drinks giant Coca-Cola has already modernised the ways in which its agency partners are rewarded, and is taking an equally pro-active attitude to demonstrating social media payback.

Wendy Clark, the company's senior vice president, integrated marketing, stated better metrics were vital to understanding the fans its trademark drink has amassed on Facebook, standing at 31.5m people.

"That is bigger than American Idol's audience on a good night," she said. "We are acquiring fans by roughly 1m every ten days."

Analysis conducted by Coca-Cola in late 2010 regarding the differences between this group and its standard customer delivered interesting findings.

"Fans are twice as likely to consume and ten times as likely to purchase as a non-fan," Clark said.

"If you can put great content out to your fan base they will pass it on. We have 30m fans who are networked to 585m people. If we do our job well, that wider network becomes our remit."

Clark is one member of Facebook's new "client council", a panel of third-party marketing experts the social network has developed to ensure it meets the needs of advertising clients.

"Measuring clicks is an old display model. We need to measure awareness, affinity and purchase intent," said Carolyn Everson, Facebook's vice president for global marketing solutions.

Agencies are also adapting their approaches in response to the seismic forces at work, with networks like Ogilvy producing documentaries, films, blogs and editorial alongside traditional advertising.

"We used to be agents. Then we weren't sure what we were, as people were terrified by the digital disruption. Now, I believe we are publishers," said Miles Young, Ogilvy & Mather's worldwide CEO.

Jeff Bewkes, chief executive of Time Warner, similarly suggested adopting a broader array of best practice advice is essential.

"Advertisers have got to make cleverer ads, you have to learn from the creative industry," he said.

Data sourced from Marketing Week, Wall Street Journal; additional content by Warc staff
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