 "The business of fluid creativity")
If the relationship between the consumer and the company has been disrupted radically in the past 10 years then further upstream, the relationship between a company and its advertising agency is undergoing one of the greatest transformations.
Consumers have in their embrace of digital technologies run far ahead of where companies are. This fast rate of adoption has proved to be extremely challenging for most companies and the organisations they turn to in order to guide them through this transition, namely advertising agencies, are themselves falling far behind and in the need of guidance and direction in how to meet the challenges and take advantage of the opportunities of digital. Digital technologies have disrupted the traditional business models of most advertising agencies and they are still reeling from the shock.
One only has to look at the very way that marketing agencies typically plan budget and execute marketing campaigns to see the cracks appearing in how they operate and their inability to guide their customers into a digital age.
Most advertising campaigns follow a very similar model. They tend to be front-loaded in terms of spends, resource allocation and the media buying which then sharply tails off after the initial impact. They are predicated on the 'big splash' approach. They involve spending as much money as quickly as possible on the biggest stone and drop it into the sea of consumer consciousness in order to generate as big a splash as possible. The problem with this approach is that this splash soon dissipates in the sea and returns to its normal state quickly. And to drive greater impact you simply need to buy a bigger stone.
Agencies not only deliver advertising through this front-loaded structure but also tend to base their revenue models on the structure and this is precisely why it is becoming so hard for them to lead their customers in digital adoption because it involves a fundamental shift in how they actually make their money.
Digital marketing requires a different approach. When we look at campaign resource planning and budgeting in a digital context, however the picture is very different. Digital technologies give us access to a level of information and analytics about what people do that we never had before. This completely alters the dynamic in marketing away from the big splash approach to a small incremental iterative and improving campaign model. It allows us to try something, gauge the response, improve the campaign and change it on an iterative basis focusing on the parts that work best. This of course has a direct and immediate impact on how an advertising agency actually resources marketing campaigns. Traditionally, much of the effort in terms of people has been in the planning and production and launch of the campaign. Whereas now the resource will be required throughout the life of the campaign in order to modify it and improve it in response to consumer interaction. Similarly, the budget now needs to be liberated from the constraints of the traditional marketing campaign and a fluid approach to budgeting for marketing needs to be adopted, which allows managers to spend money where they are getting the best reaction and result.
Now let us look at banner advertising. This medium offers the greatest opportunities for iterative change and improvement based on user response. All digital advertising formats allow us to change a brand's creative, message and a call to action on an almost daily basis.
Yet we are still very much prisoners of the first published idea. The concept we actually go to market with is never the best one, it's just the one we start with and if we are open to allowing the users dictate what they want then any campaign gets better over the life of the campaign. It improves in terms of response rates as we change it in response to user interaction and preferences.
When meeting companies or students to talk about digital, I always ask two questions: First do they use display or banner advertising and if they do, how many times during the life of their campaign do they change their ads in terms of creative, message or call to action. The answer I receive is consistent across the globe: "yes" they engage in banner advertising and "no" they never change the creative or content once the campaign has gone live.
We are therefore creating and implementing digital marketing with a traditional marketing mindset and structure. The iterative and responsive approach to advertising and marketing campaigns is the complete opposite to the traditional front-loaded approach. It requires a change in how we resource budget for plan and implement marketing campaigns. Digital provides the opportunity to move away from a big splash approach and instead of throwing stones we get to cast lots of pieces of wood onto the water. Stones sink but wood floats and is carried by the water.
Advertising agencies that can embrace this shift in emphasis towards a responsive and iterative campaign structure will provide guidance and direction that most companies need in learning how to embrace the opportunity of digital.
Ian Dodson
founder, Digital Marketing Institute
Consumers have in their embrace of digital technologies run far ahead of where companies are. This fast rate of adoption has proved to be extremely challenging for most companies and the organisations they turn to in order to guide them through this transition, namely advertising agencies, are themselves falling far behind and in the need of guidance and direction in how to meet the challenges and take advantage of the opportunities of digital. Digital technologies have disrupted the traditional business models of most advertising agencies and they are still reeling from the shock.
One only has to look at the very way that marketing agencies typically plan budget and execute marketing campaigns to see the cracks appearing in how they operate and their inability to guide their customers into a digital age.
Most advertising campaigns follow a very similar model. They tend to be front-loaded in terms of spends, resource allocation and the media buying which then sharply tails off after the initial impact. They are predicated on the 'big splash' approach. They involve spending as much money as quickly as possible on the biggest stone and drop it into the sea of consumer consciousness in order to generate as big a splash as possible. The problem with this approach is that this splash soon dissipates in the sea and returns to its normal state quickly. And to drive greater impact you simply need to buy a bigger stone.
Agencies not only deliver advertising through this front-loaded structure but also tend to base their revenue models on the structure and this is precisely why it is becoming so hard for them to lead their customers in digital adoption because it involves a fundamental shift in how they actually make their money.
Digital marketing requires a different approach. When we look at campaign resource planning and budgeting in a digital context, however the picture is very different. Digital technologies give us access to a level of information and analytics about what people do that we never had before. This completely alters the dynamic in marketing away from the big splash approach to a small incremental iterative and improving campaign model. It allows us to try something, gauge the response, improve the campaign and change it on an iterative basis focusing on the parts that work best. This of course has a direct and immediate impact on how an advertising agency actually resources marketing campaigns. Traditionally, much of the effort in terms of people has been in the planning and production and launch of the campaign. Whereas now the resource will be required throughout the life of the campaign in order to modify it and improve it in response to consumer interaction. Similarly, the budget now needs to be liberated from the constraints of the traditional marketing campaign and a fluid approach to budgeting for marketing needs to be adopted, which allows managers to spend money where they are getting the best reaction and result.
Now let us look at banner advertising. This medium offers the greatest opportunities for iterative change and improvement based on user response. All digital advertising formats allow us to change a brand's creative, message and a call to action on an almost daily basis.
Yet we are still very much prisoners of the first published idea. The concept we actually go to market with is never the best one, it's just the one we start with and if we are open to allowing the users dictate what they want then any campaign gets better over the life of the campaign. It improves in terms of response rates as we change it in response to user interaction and preferences.
When meeting companies or students to talk about digital, I always ask two questions: First do they use display or banner advertising and if they do, how many times during the life of their campaign do they change their ads in terms of creative, message or call to action. The answer I receive is consistent across the globe: "yes" they engage in banner advertising and "no" they never change the creative or content once the campaign has gone live.
We are therefore creating and implementing digital marketing with a traditional marketing mindset and structure. The iterative and responsive approach to advertising and marketing campaigns is the complete opposite to the traditional front-loaded approach. It requires a change in how we resource budget for plan and implement marketing campaigns. Digital provides the opportunity to move away from a big splash approach and instead of throwing stones we get to cast lots of pieces of wood onto the water. Stones sink but wood floats and is carried by the water.
Advertising agencies that can embrace this shift in emphasis towards a responsive and iterative campaign structure will provide guidance and direction that most companies need in learning how to embrace the opportunity of digital.
Ian Dodson
founder, Digital Marketing Institute