The Association of National Advertisers’ annual Masters of Marketing conference painted a depressing picture, says Gareth Kay, with driving greater efficiency being lauded over the creation of valuable brands and end-to-end brand experiences.
Bob Liodice, head of the Association of National Advertisers, painted a bleak picture at the beginning of their annual Masters of Marketing conference. He pointed out that 259 companies on the Fortune 500 list had declining revenues. "Look at the pattern of US business sales that declined for the last two calendar years," said Liodice. "This is a terrible proxy about the effectiveness of our marketing." This feels rather like the commercial outcome of the infamous Havas finding that most people wouldn't care if three-quarters of brands disappeared tomorrow.
The annual event exists to showcase best practice in marketing and is a good barometer of its health. So, if you believe the role of marketing is to drive sustainable growth, then it's fair to say the warning signs were writ large. Consequently, you might have expected to see a rigorous discussion about whether marketing was fit for purpose. On new ways to build brands. On how marketers can help transform the fortunes of business. Yet, sadly, the debate – a microcosm of the overall debate in the marketing industry – felt myopic at best.
During the week, there was a roll call of concerns about the state of the industry: digital fraud, viewability, brand safety, ad blocking, ineffective leadership. All valid concerns. But for a discipline whose purpose is to grow demand, its focus on the supply side and driving greater efficiency felt surprising. P&G's chief brand officer, Marc Pritchard, outlined the steps P&G are taking to 'clean' the digital media supply chain. Much of this makes sense: seeing if people, not bots, are viewing ads; capping frequency. But what strikes me as odd, and perhaps dangerous, are the strides being taken in the name of efficiency by some of the biggest marketers to build more one-to-one, highly targeted marketing.
There's a move afoot to use 'digital' as a way to drive greater efficiency of communication. To target intent. All well and good, but we've forgotten about what makes advertising communications truly effective: the creation of intent in the first place. We've forgotten that 'waste' is in fact highly valuable when it comes to the creation of valuable, long-lasting, margin-commanding brands. All the work analysing the IPA Databank by Binet and Field, and the work of the Ehrenberg-Bass Institute has shown that growth is predominantly driven by growing penetration, not loyalty. It's a game of fame and the overheard conversation is as valuable, if not more valuable, than the one originally targeted for. It creates intent and it works in the long term. Digital, and programmatic in particular, are creating an environment where we value laser targeting and immediate payback. We judge success through short-term results. But the most effective campaigns reveal their full impact over time by building fame among a broader audience. We risk being caught by Rory Sutherland's conundrum that "what gets measured gets managed; what gets mismeasured gets mismanaged". We're at risk of seeing digital media as the reinvention of digital response, not a new canvas to build fame for brands.
We risk forgetting how advertising can contribute to the creation of that economically magical thing: the brand. But, more importantly, the ANA conference did little to dispel how marketing can be its own worst enemy. Repeatedly, marketers talked about a magical piece of film at the crux of their brand reinvention efforts; advertising as the most important thing they do. There were few stories of transformation and reinvention beyond marketing communications. Of how marketers used their skills to help a company grow through creating more desirable products or services. Of how marketers can find new ways of working to create coherent, joined-up experiences that people are more likely to care about. No talk about breaking down the silos; about new ways of working across the organisation and across partners; about how marketing can realistically lead organisations towards growth. All this seems rather at odds with a recent Gartner study which suggests more than four out of five companies believe customer experience will be the basis of their competitive advantage versus only one in three four years ago. It's a huge opportunity for marketers and those who advise them. If only we'd ever lift our heads up.
It seems we remain stuck in the same ever-decreasing circles. And marketing risks putting its foot on the accelerator by seeing technology as a tool to drive greater efficiency, not create more valuable futures through transforming how people experience a brand end to end.