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TV Advertising Still Works…

  |  June 23, 2011   |  Comments

Advertising on television may make consumers feel better about your brand, but does it actually drive any incremental sales?

TV advertising still works. Well, that's if you still believe in Santa Claus, the Easter Bunny, and the Tooth Fairy. And I guess some people do. But if you're spending 90+ percent of your budget on TV or other traditional forms of one-way, push media (magazines, radio, newspapers, etc.), it's time to think again.

History of TV Advertising - Why It Used to Work

When advertising on TV first started, it represented an incredibly efficient way of getting one message out to a ton of people quickly. Why it worked was because it increased awareness of a product where there was none before. And so sales went up as more people became aware of the product - e.g., Tide detergent. Why it no longer works is because most brands don't have an awareness problem. Awareness of brands is already maxed out in most cases; so doing more awareness advertising is wasteful. If awareness is not lacking, then it's something else that's keeping more customers from buying. More awareness advertising fails to address these "something elses."

The Myth of Branding - Why It No Longer Works

Many advertisers still support the use of TV advertising with the argument that "it helps with branding; it makes people feel better about the brand." It may. But does that actually drive any incremental sales; or, put another way, is it possible to directly attribute sales to it? Of course there are studies that say people buy more from brands they are passionate about. But don't confuse that with TV ads causing people to be more "in love" with the brand. It doesn't.

Modern users are not only very savvy, but they are also empowered with information, friends who can help them cut through the clutter, and tools that give them instant and constant access to the above. When they are oversaturated with information and bombarded at every moment with ads, they have gotten to be experts at tuning everything out. Indeed, traditional advertising is like "homeless marketing," where at best, you get a glance to get your message across. A March 2011 Forrester study further reports that "53% [of consumers] think ads are intrusive and only 21% say they trust ads."

Even if they did see the ad, 30 seconds is not enough time to get enough information across to be meaningful any more. Hence, we see consumers flocking online to look up additional information before they buy. So what are the bits of information that people need to move closer to the purchase? What are these "missing links"? In a personal example, I've been 100 percent aware of the awesomeness of Apple's operating system and computers. But my missing link is how hard it would be to make the transition to Mac OS after having been a PC user for 15 years. Nothing in a :30 TV ad, print ad, or radio ad would solve that. In another example, my missing link regarding FlyClear's "get-through-airport-security-faster" service was who has access to my iris scans, fingerprints, and passport. None of the brochures or representatives could answer that bit of information. So in both of these examples, I ended up not buying.

So branding, done through traditional forms of one-way push advertising, does not work. First, advertisers would be lucky if target users even saw the ad. Second, telling people about your own awesomeness doesn't make them think you're awesome. And finally, consumers are powerful and powerfully informed, so if your product or service wasn't already actually awesome, you don't have a snowball's chance in hell of making them "feel good" about your brand through shouting your message at them.

Names Have Been Changed to Protect the Innocent

In two more dramatic examples of the complete failure and irrelevance of one-way push advertising, we zero in on the business impact that they produced.

The first was a well-publicized TV campaign that featured a super hero and a super comedian. Aired before the era of YouTube, it was designed to drive people to a microsite to watch the short films (branded entertainment). But when it came to 1) the number of people actually going to the site to watch, 2) the number of people who took action as a result of the campaign, and 3) the number of people who actually became customers, let's just say it was statistically indistinguishable from the number that means "thin air."

The second example saw a department's ad budget get slashed by 90 percent for an extended period of time. During that period, the number of unique users to the website was unchanged and the rate of new customers signing up was exactly identical to prior periods where 100 percent budget was being spent in all manner of push advertising.

Finally, I have shown in a prior column how ephemeral the effect of Super Bowl ads are. Excerpting, "For example, on February 1, the day of Super Bowl XLIII, 20 of the top 100 Google searches related to ads aired during the game. On day two, it dropped to 6 out of 100. On day three, 1 out of 100. By Day four, February 4, none of the top 100 Google searches related to the ads or the advertisers."

So, Where Do We Go From Here?

  1. Use TV advertising if you must; but only if you absolutely have just an awareness problem.
  2. Look for integrated approaches to solve more of the other scenarios that involve customers' missing links (the bits of information they need to move expeditiously down the funnel towards the purchase).
  3. Go digital when you have low budgets and need high accountability and ROI and when you want to serve savvy, informed customers the way they want to be served and respected.


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Augustine Fou

Dr. Augustine Fou is the senior digital strategy advisor to CMOs, marketing executives, and global brands. Dr. Fou has over 15 years of Internet strategy consulting experience and is an expert in social media marketing strategy, data/analytics, and consumer insights, with specific knowledge in the consumer packaged goods, financial services/credit cards, food/beverage, retail/apparel, and pharmaceutical/healthcare sectors.

He is a frequent panelist, moderator, and keynote speaker at industry conferences. Dr. Fou is also an Adjunct Professor at NYU in the School for Continuing and Professional Studies and at Rutgers University at the Center for Management Development, where he teaches executive courses on digital strategy and integrated marketing.

Dr. Fou completed his PhD at MIT at the age of 23. He started his career with McKinsey & Company and previously served as SVP, digital strategy lead, McCann/MRM Worldwide and group chief digital officer of Omnicom's Healthcare Consultancy Group (HCG). He writes a blog "Rants, Raves about Digital Marketing" and can be found on Twitter at @acfou.

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