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The Evolution of Advertising Strategy

2010 November 10

Michael Porter, the renowned strategic thinker, says that “Sound strategy starts with having the right goal.”  However, what is becoming even more important is choosing the right kind of goal.

As technology, media and the marketplace evolve, the way we plan needs to adapt and change as well.  This is truly one of the great challenges of modern marketing and it requires us to not only think differently than in the past, but also acquire the skills to meet new challenges and grasp emerging opportunities.

To gain perspective, let’s review how we got to this point and then look to what the future holds.

Creative Planning

After World War II, most of the globe went through several decades of seemingly boundless economic expansion.  People had ever more money to spend and business expanded to satisfy the demand.  It was the dawn of the branding age and marketers strove to make their products popular with consumers hungry to join the consumer culture.

It was also an era of mass media.  There was a limited amount of TV stations and programming was geared to mass audiences.  Popular broadcasts like The Ed Sullivan Show in the US could reach more than 50% of the population, so getting your message out wasn’t a problem.  Consequently, strategy revolved around what the message should be.

In this environment, “the big idea” was at the center of planning.  Advertising pioneers such as David Ogilvy and Leo Burnett developed powerful brand images and media was generally chosen to suit the creative concept.  Media departments were widely seen as “gorillas with calculators” who were not central to the strategic process.

Communications Planning

With the 1970’s came the arab oil embargo and difficult economic times.  In this environment, financial accountability began to take precedence over big creative ideas.  Some of the “gorillas with calculators” went out and started their own independent media agencies with an emphasis on volume, tough negotiations and low prices.

Then, in the 80’s and 90’s, cable and satellite technology transformed the media landscape and fragmented audiences.  No longer could you be sure that your target consumer would see your message no matter how big the idea was.

In the new environment, media agencies moved upstream and communications planning was born. The central strategic question became “where is our consumer.” When you can’t reach everyone, you need to target your messaging before you can target your message.

Still, as in the earlier creative driven era, the primary marketing objective was awareness, which was assumed to lead to sales and eventually to loyal consumers.

Strategic Marketing Planning

In the digital age, we not only have increasingly fragmented audiences, but fragmented metrics as well.  GRP’s, aided and unaided awareness, market share, CTR’s, conversion ratios, engagement metrics, net promoter scores and still more to come.

The current marketplace requires us not only to choose the best communication channel to reach our consumer, but also to focus on what we want our marketing to achieve. Raising awareness will do little if we are not converting awareness to sales, just as increasing market share alone is a short sighted strategy if our competitor has built a strong community of consumer advocates.

This means that we need to start making a distinction between planning metrics and ROI metrics. First we need to analyze the brand pathway to determine what type of action can do our brand the most good and only then can we make a decision about how we are going to judge success.

The old days of static performance indicators is gone.  Today, strategy needs to adapt to a specific need of a specific brand in a specific marketplace.  The market simply moves to fast for dogmatism to keep up.

The New Creativity

Most of all, the new marketplace requires a new notion of creativity.  Big ideas aren’t enough anymore. Creativity needs to be integrated across a variety of platforms by people with a diverse set of skills.  Today’s marketing problems need to be solved by cross functional teams that are often ad hoc and diffuse with weak operational interfaces.

Richard Ogle, in his book Smart World, underlines the problem in his narrative about how most great discoveries have come from synthesizing ideas rather than great “Eureka!” moments.  With the dizzying array of new technology and the fantastic marketing opportunities that a digitized, networked world presents, no one person, method or role possesses ultimate wisdom.

While this challenge has been widely recognized, the issue is usually centered on talk about “unsiloed organizations.” The reality is that we need to unsilo ourselves.  We need to build diverse skills and knowledge that cross domains, rather than be content to sit in one specialized area for an entire career.

To truly grasp the new creativity that the digital revolution has unleashed, we first need to recreate ourselves.

- Greg

8 Responses leave one →
  1. Jan Golden permalink
    November 11, 2010

    New notion of creativity, teams that work well together-yes you are very right. Advertising teams must have a strong mandate and strategy. Advertising always has to re-invent it’s self to meet the needs of the current technology and social trends. But, the underlying consumer psychology is the same, how to get people to part with their hard earned money for the brands that are advertised. So it’s back to the future- solid, creative advertising and sales principles. We only need to change our thinking about what proportion of media mix is need for each medium. Test, experiment, don’t be afraid to jump into new technology-It is still the same game

    [Reply]

    Greg Reply:

    Good point, Jan. As I wrote in an earlier post, consumers today are very much like the humans who roamed the earth a decade ago:-)

    - Greg

    [Reply]

  2. November 14, 2010

    Hey Greg,
    I beg to differ in this. Although the consumer psychology is the still the same, the more choice is being offered, his level of expectation also increases concurrently. I remember my professor’s lines of increasing segmentation leads to increased expectations. Today’s networked consumers wants to carry all his experiences everywhere. He is now looking for customizable experiences and is more willing than ever to collaborate with the producers of goods/services to offer him the most suited service!
    Venky´s last blog post ..Reflections up in the air about our connected age

    [Reply]

    Greg Reply:

    Venky,

    Thanks again for a very thoughtful comment.

    There is a lot of truth in what you say and increased segmentation does change a lot in terms of how we execute, but not in how we plan. For instance, if you had a more segmented marketplace for your brand than a decade ago, but awareness was still your objective, you would simply come up with a more specific positioning and increase the campaign intensity.

    Also, customizable experiences are not new, just newly feasible, and they aren’t always a good thing. The “paradox of choice” often alienates consumers.

    - Greg

    [Reply]

    Venky Reply:

    True..Im quite excited about paradox of choice. Ever since I read about it, I’ve been wanting to explore Sheena Iyengar’s “Art of Choosing ” and wanted to juxtapose it with Long Tail. Would love to hear your thoughts.
    Venky´s last blog post ..Reflections up in the air about our connected age

    [Reply]

    Greg Reply:

    Venky,

    I think they’re completely separate notions. The paradox of choice arises because we can only keep sdo many things in our head. The long tail is more of a natural phenomenon. It applies to river systems as well as it does to e-commerce.

    - Greg

  3. December 8, 2010

    This is more interesting thoughts. I especially like the ‘paradox of choice’, which I guess means more and more brands and better and better marketing–eventually confuses customers. So, how are we going to take the product to a consumer, in a way he likes it…may be we shoudl concentrate ona benchmarketing strategy….?

    [Reply]

    Greg Reply:

    Interesting point. Thanks.

    - Greg

    [Reply]

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