Incoming!

  

           

WARC published a release from the Fournaise Marketing Group in the UK that CEOs are suspicious of creativity.  That got my attention.  So off I went to the Fournaise Group to get the skinny on this creativity thing, and it turns out it these guys aren't fooling around:

1) 76% of CEOs feel Ad & Media Agencies are not business-pragmatic enough, are too inward-looking, talk too much about “creativity as the saviour” without really being able to unquestionably prove or quantify it, and are often too opportunistic.

Indeed these CEOs view agencies as often being too quick to claim credit for business results that they were not able to unquestionably prove came directly from what they created (such as attributing year-on-year sales growth to their creative/media activities when in fact growth came from product, sales force, channel, pricing and/or operation factors);

2) 74% of CEOs think Ad & Media Agencies are too disconnected from the short- and medium-term business realities: they keep on talking about “giving time to creativity to see the impact” and fail to truly understand the type of Shareholder/Board pressures the Management is facing;

3) CEOs admitted they initially assumed (at the start of their Management careers) that Ad & Media Agencies were the ultimate specialists when it comes to understanding customers and target audience’s behaviours, and to knowing how to best engage with them: however, 72% of these CEOs admitted they soon realised Ad & Media Agencies were not as data- and science-driven as they had expected, relied too much on gut-feelings, hearsay, wrong methodologies and questionable information – greatly reducing the trust these CEOs have in these agencies;

4) 70% of CEOs feel Ad & Media Agencies too often hide behind technicalities such as not having enough budget or not being paid fast enough as a way to justify their inability to deliver the (real and P&L-quantifiable) business results expected of them.

Now, to show that they aren't all cold-hearted bastards, CEOs said they were willing to kiss and make up if agencies agree to the "Payment-by-Result (PRM) Model—naturally forcing them to cut the fluff and to become the business and demand generator partners CEOs expect them in the first place."

My first reaction to this peace offering is that this is a shot across the bow of the HMS Social Media.  All the points the CEOs make seem aimed at the fuzziness of Social Media accountability. Yeah, sure, there are a few companies that have a large presence on Facebook but these examples need some perspective.  Let's look at Coke's Facebook page. As of this writing, it has 69,331,714 likes and 875,499 people taking about it, whatever that means. Coke, however, sells 1,700,000,000 servings EACH DAY, which is several of orders of magnitude larger than the 69,331,714 likes it accumulated since the page went live in 2009.

Up Periscope

Now, let's get down to customer level.  Using a "simple" method, the average Coke drinker buys (in the UK at least—US figures are nearly similar but measured differently) 12 servings a year.  But as Byron Sharpe (buy his book, damn it!) points out, this figure is skewed towards the miniscule group that buys it three or more times A DAY, and that the average buyer is nowhere near that amount. In fact, the "typical" Coke customer (~50% of total customers) actually buys between one and two servings PER YEAR. That's it. With so many customers buying so little product per year, it makes one wonder would it not make more sense to get those who typically buy one to three per year to, perhaps, buy one or two more?  Still, Coke's FB presence is pretty benign and gives fan boys an outlet but it still pours much more into traditional channels than Social.  Perhaps Coke learned that lesson from Pepsi, which went full-on stupid with Social and lost about 5% market share, or $350 million, in 2010.  Their slide continues to this day.

To be fair to some of the Social Media folks, I have to wonder what exactly CEOs expect their advertising to achieve and are those expectations realistic.  If they are hoping to get an immediate bump in sales when advertising an established brand into a mature channel chock-a-block with competition, without any earth-shattering change in the product's features or its price, they will be disappointed.  Part of the reason is because they base their ads and campaigns around tired and meaningless USPs.  Saying their product is different and does X might have worked when the product was first in category but that won't cut it anymore because their competitors have caught up—and are likely using a version of that USP—and any differentiation is purely subjective.

CEOs need to recognize that, if they have nothing "new" to sell, they need to focus on the product's distinctiveness, if any, and build brand salience.  They need to find and exploit what makes sets their product apart, what makes it stand out on the shelf and be easily recognized in those fleeting seconds of the consumer's decision-making process.  And that takes time with not much return in the short run.  It must also be consistant and on bran.  This is where Social Media can be added to the mix.

Or maybe the CEOs need to stop thinking agencies can solve all their business problems and let them focus on creative.  They should also leave the task of business-building to those who are supposed to do it—themselves. 

Last Word

Anyway, the only area online that is getting results is email.  Wired reported last week "Email is crushing Twitter, Facebook for selling stuff online."  Their graph makes it quite clear:

I find it funny that the red-headed step child of advertising, Direct Marketing, leads the way in generating and maintaining online sales.  And I won't say I told you so because that would be gloating…