At a time when marketers are pressed to measure results and prove the connection between what they do and its impact in the marketplace, two recent columns in "Advertising Age" stood out. I first caught the summary of an Al Ries column that read, "Running business by the numbers is just not logical." I thought he was kidding but quickly realized he was not. As I turned inside the paper to the full column, I came across Rance Crain's defense of advertising in light of the financial morass as "simply the messenger."
At Progressive Insurance, where I was a product manager, business is run by the numbers. Climbing from the top 50 to well inside the top five in any sector doesn't happen by hunches alone. At GSD&M, where I worked with clients on marketing integration strategies, we were guided by a fundamental tenet: Advertising is much more than a messenger. It's a powerful source of influence that can move consumers to do what they would not have done otherwise.
Respecting Messrs. Crain and Ries -- both smart people known for insightful views -- if ads didn't spur sales and we couldn't prove up the results, this business would have died a long time ago.
Hence my reaction when I read these two columns. At the root of Mr. Crain's column was the partial blame attributed to the ad industry for contributing -- in whatever way -- the financial meltdown. Mr. Crain's view was evidently, "Don't blame us just because consumers did what we told them to do." He pointed to a recent Harris Poll showing that about two-thirds of American adults believe ad agencies bear some responsibility for the economic crisis because they caused people to buy things they couldn't afford. I'm thinking they're right.
After all, wasn't that the point of the ads? To encourage people to buy things? As Americans we are about consumption, and advertising is a good part of what drives that consumption. I've yet to see a successful agency pitch that started out, "Our research showed that consumers are maxed out on credit, so we've designed a campaign for you suggesting that consumers hold off until next year on that new car." (Speaking of, Saturn's new campaign adds to what Hyundai started: it's a campaign that is most definitely intended to move a consumer to action, and, will most definitely be measured. Kudos to both.)
Whether it was over-consumption, the ad-driven belief that banks were more like rocks than, say, water vapor, or a steady diet of television programming like, "Flip This House," the fact is that advertisers worked hand-in-hand with clients to create demand that drives purchases. To now say, "Hey, we're not at fault, we're just the messenger" is to further damage the credibility and trustworthiness of the ad business itself. I cannot think of a worse time to be doing that.
According to Jupiter Research, a 2007 global study found that only about 10 percent of those polled considered advertising to be trustworthy. Compare this with friends and people like themselves, who were considered to be about 30 percent trustworthy. In other words, asking someone "like you" whether or not a product or service was likely to satisfy your needs was three times as likely to produce a trusted answer as asking the marketer who offered it.
Gap Widens Between Marketers and Consumers
Consumers using the social Web and social media -- and not advertisers -- are stepping in to fill a gap between marketers and consumers.
The social Web is now mainstream, and social media -- in particular the content that people create in response to experiences with products, brands, and services -- is a factor in all of this. Again citing Mr. Crain's column and his reference to the Harris Poll, people 55 and over disproportionately considered (75 percent) ad agencies partly responsible for the current mess when compared with younger people (18 to 34, 60 percent). Why the difference? I'd posit that that older people -- more than a few of whom thought of Robert Young as being a doctor when he pitched Vicks Formula 44 on TV -- actually believed the ads and acted accordingly. And why shouldn't they? America is a country where the people we look up to tell the truth, right?
Younger people don't hold this same view. Recent scandals affecting nearly every sector of American life have eroded trust, and as a result, this group believes a lot less of what marketers tell them and a lot more of what they hear and read in their personal social networks. Back in 2002, as broadband and the social Web were emerging, John Horrigan of the Pew Internet & American Life Project put it this way: "No matter what people see, hear, or read on TV, the radio, or magazines, they can verify it on the Internet." And verify it they do.
Younger People Get Their Information From Other People Like Themselves
As young people turn to their peers for information -- increasingly on the social Web -- Boomers are doing the same. This makes social media a big force for marketers to contend with.
Keep in mind, social media is a direct response to our need for trusted, personally relevant information. And marketers must consider the power of this new form of media. People create and share content based on their own personal experiences in the hope that others will be moved or influenced to join in and do the same. It's a systemic response to one-sided communications that have placed the marketer's interests (for example, selling the TV) ahead of the customer's interests (being able to pay for the TV). To miss this connection is to miss the responsibility that comes with being a source of trusted information.
Adding value on the social Web -- call it the creation of social capital -- requires the establishment of trust. Claiming that "someone else" was responsible for consumer purchases and behaviors is to suggest that we (advertisers) weren't. Really? Play that sentence backwards and see if you'd anchor your agency's next new business presentation on it.
All of this gets at the current interest in numbers -- in establishing return on investment -- in particular around the interplay between the social media and traditional media. Quantitative measurement is central to this understanding. Mr. Ries contends, "Advertising is more like insurance than an investment." It's exactly this defense of soft-logic -- recall the oft-quote, "I know half my advertising is wasted I just don't know which half"-- that gets CMOs in trouble. CEOs, CFOs, and COOs live by numbers because numbers tend to be robust and valuable as planning tools. Quantitative tools allow a management team to actually chart its course and then hold to it. If you've ever been in the hot seat on an analysts' call you'll understand the importance of this.
Social media based marketing is part of this measurement trend. The current interest around social media has as much to do with the appeal of hard measurement as it does with the media itself. For example, while marketers may be hesitant to create and share content or initiate a blog, most are now interested in counting the number of comments about their brand, product, or service and separating the positive references from the negative, identifying the influential sources of content and more. Armed with this basic quantitative data, marketers can engage their operations counterparts in the redesign of the customer service team or next year's wakeboard designs thereby impacting positively and measurably the general tone of the conversations that drive sales.
Far from shirking responsibility or discouraging measurement, marketers looking to tap social media for their businesses ought to be driving demand for measurement and finding themselves in much closer partnership --a.k.a., accepting responsibility -- with their customers. This means building trust and operating in alignment with customers rather than self-interest. Importantly, the social Web rewards this. So, as you're building your next marketing program, look for causal connections between your advertising and marketplace conversations that drive sales. Look as well for ways to measure -- quantitatively -- the results.
One more thing: Don't believe everything you read.
Meet Your Favorite ClickZ Contributors
Many of ClickZ's leading expert contributors will be at ClickZ Live, the new online and digital marketing event kicking off in New York (March 31-April 3). Hear from the likes of: Jeremy Hull, Lisa Raehsler, Andrew Goodman, Bryan Eisenberg, Mathew Sweezey, Aaron Kahlow, Stephanie Miller, Simms Jenkins, Jeanne S. Jennings, Dave Hendricks and more!
Dave is the VP of social strategy at Lithium. Based in Austin, Dave is also the author of best-selling "Social Media Marketing: An Hour a Day," as well as "Social Media Marketing: The Next Generation of Business Engagement." Dave is a regular columnist for ClickZ, a frequent keynoter, and leads social technology and measurement workshops with the American Marketing Association as well as Social Media Executive Seminars, a C-level business training provider.
Dave has worked in social technology consulting and development around the world: with India's Publicis|2020media and its clients including the Bengaluru International Airport, Intel, Dell, United Brands, and Pepsico and with Austin's FG SQUARED and GSD&M| IdeaCity and clients including PGi, Southwest Airlines, AARP, Wal-Mart, and the PGA TOUR. Dave serves on the advisory boards for social technology startups including Palo Alto-based Friend2Friend and Mountain View-based Netbase and iGoals.
Prior, Dave was a co-founder of social customer care technology provider Social Dynamx, a product manager with Progressive Insurance, and a systems analyst with NASA| Jet Propulsion Labs. Dave co-founded Digital Voodoo, a web technology consultancy, in 1994. Dave holds a BS in physics and mathematics from the State University of New York/ Brockport and has served on the Advisory Board for ad:tech and the Measurement and Metrics Council with WOMMA.
March 19, 2014