Digital Scores A Comeback

As predicted in the first part of this blog, as technology vendors take over the agenda at ANA’s annual conference from classic brand advertisers – the discussion of digital advertising comes to the fore.  Diane Brink of IBM discussed Smarter Planet – IBMs large scale infrastructure project to wire the world and make information highly portable across devices, geographies, and systems – which was a perfect lead in to Eric Schmidt, CEO of Google.  I wanted to relate some of the key aspects of his presentation.

• First, an interesting tid bit.  In the history of humanity through 2003, there has been 2 exabytes of information recorded and stored.  In 2009, 2 exabytes of data are created EVERY 2 days. So every 2 days, humanity creates as much exigent information as humans did in all of pre-2003 history.  Sobering.
• Second, technology is shifting the balance of power around consumer transactions away from the advertiser and toward the consumer.  Specifically, advertisers have a continuous test of brand value.  The ability of the consumer to get reviews and comparative pricing information in real time, and leveraging mobile devices, at the point of sale, puts a risk on advertisers if they have an inferior offering. However, the ability to influence those individual transactions has never been greater – through search advertising, through targeted display advertising, and through social media.  Winning brands will survive the “information explosion” and see this as an opportunity and organize themselves to take advantage of this “new order” of branding.
• Third, mobile is a huge focus for Google. Mr. Schmidt indicated that the growth in mobile, and the opportunity it affords advertisers, is staggering.  He said that the people at Google are challenged to think about the entirety of the opportunity mobile presents – given its ability to not only provide an advertising platform that is aware of a consumer’s location, but through leverage of their past behavior, can predict their actions and make real time recommendations (see Minority Report!).  He used an example of the airport, where the mobile device will be able to tell a passenger, upon checking in for a particular flight, the on-time percentage of the flight, its ETD, its ETA, and can predict the “level of frustration” a passenger will likely experience.
• Fourth, this fits into his overall approach – that advertising will ultimately be transparent, local (personal), scalable, and measureable.  He pushed the audience to consider these four factors in designing and executing any campaign – and if the advertiser/agency ecosystem is unable to execute on these processes, they risk losing out on the future dynamics of the brand battle.

I found it amusing that the first question from the audience was a question on Google’s foray into traditional advertising media “so what happened to Google Radio and Print?”  Google has a great perspective on this.

Each advertising channel has a different “quality of measurement” –with search, it is extremely high quality, with radio and print it is of lower quality.  Mr. Schmidt said that they pulled back on radio because Google was unable to offer a significant improvement for the media buyer over the current process.  Why?  There was no way to get a return signal on the effectiveness of the advertising.  This is not the case with Google TV.  Since Google is leveraging Echostar to do the TV placements, the “box” that satellite users have acts like a feedback computer to see whether the ad is actually viewed by a household with the appropriate target demographics for the brand.  There is feedback.  HD Radio will provide the same capability ultimately, as will the Kindle (if you can consider the Kindle rendering of “print” to be analogous to the traditional “print media”).  He expects this effort to revive itself as the technology evolves.

The last point is that Mr. Schmidt said that his ideal system would provide advertisers with the dashboard of performance for all their media channels, with the correlative impact each channel has on driving brand awareness or brand purchase.  This is a vision shared by Covario – and not surprisingly, it springs from organizations that dedicate themselves to search.  Search has a privileged position in this conversation given its “last click” fulfillment of the buying funnel.  We see the same from all of our clients – search is not just a media channel, it is an enabler of effectiveness across all media channels.  Ultimately, as Covario (and Google) integrate data together on advertising and marketing, the ability to do direct statistical analysis on behavior, and “fuzzy logic” on behaviors that cannot be directly measured – the ability of marketers to advertise transparently, locally, at scale, and with complete measurement.

ACTIONABLE INSIGHT #1: Advertisers need to develop a comprehensive mobile strategy for 2010.  Execution may not necessarily take place in the US for all brands, but testing should be most aggressive in Scandinavian countries, Japan and Korea where cell phone use is more advanced.

ACTIONABLE INSIGHT #2: As Search Marketers, with an understanding of the power of measurability, we are in the best position to help drive the necessary change in our organizations to embrace the principals of transparency, personalization (locality), scalability and measurability.  This is a big issue, but the technology exists to allow this transformation to begin and it is imperative to having a winning brand 5 years from now.

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