Will the Future of Advertising Be a Blend of Old and New Media?

It hasn’t caught on yet in the U.S., but a global ad campaign for Unilever’s army of laundry detergents — sold in Asia as Omo, in France as Skip, and by other names around the planet — hailing that “Dirt is Good,” is considered by experts to be a perfect example of a new path for marketing in the 21st century.

The marketing push merges memorable images of children splashing in mud with a customer-engaging social message — “every child has a right to play and explore.” Some claim the ad helped push Singapore to increase recess time at its academics-heavy, stress-inducing schools.

The early success of Unilever’s advertising strategy is exactly the type of information that company marketing executives and ad agencies need to discuss as they struggle to develop new ideas to handle the cataclysmic changes in technology and communications — from Tivo to Twitter — that have altered the ways companies interact with customers. But until now, there has been surprisingly little coordinated effort to re-invent the science of advertising or to rewrite the basic manual of what advertising strategies don’t work and which ones do — and under what set of circumstances.

That is the mission of a new effort by the Wharton School’s SEI Center for Advanced Studies in Management — called, quite simply, the Future of Advertising Project. It seeks not only to collect case studies and data, and ask experts to debate the best new practices in the fast-changing world of marketing, but also to make its own use of New Media to build a broader audience for its work.

Partnering with the search-engine giant Google, the Wharton project took a huge step in that direction this fall with the launch of a new channel on Google’s popular YouTube site called Fast.Forward offering what it calls “quick perspectives” — primarily in the form of short video clips — on the future of marketing from executives, ad gurus and academic thought leaders.

The Google site features clips such as a 1-minute-and-14-second riff from Kevin Werbach, a professor of legal studies and business ethics at Wharton, on “What Change Does the Internet Bring to the Relationship Between Brands and Consumers.” (In it, he says “[t]he Internet is becoming more ubiquitous, more social and also more immediate, and that is upsetting all sorts of business models….”) Within just a few days, the Fast.Forward channel had garnered 12,500 views and hundreds of new subscribers.

Yoram (Jerry) Wind, director of the SEI Center, says the Future of Advertising Project is working toward the ambitious goal of creating what he calls “a portfolio model” of advertising that would allow companies to craft a unique strategy using a traditional mix of traditional and new media to make sure it’s reaching the right customers. “When families create an investment portfolio, the idea is to figure out what is the objective of the investment and then make your decisions based on that,” Wind says. “We want to bring that same approach to advertising” — in other words, weighting the use of various techniques like TV spots compared to Internet advertising or communicating directly with consumers through social networking sites like Twitter or Facebook.

Wind notes that despite the intense focus on advertising moving to the Internet, a winning marketing plan is, in fact, still likely to be a hybrid involving new and old media. “It will be synergistic — they will build on each other and produce the best result.”

Unsettling Times

The Future of Advertising Project comes in the midst of what is arguably the most unsettling period in the advertising industry since the rapid growth of television in the 1950s. And this time, it has been harder for experts to get a complete handle on how to respond to technological change. The reason, in part, is that the global economic recession has slashed advertising budgets at virtually every company across most platforms, for an overall decline in spending in 2009 in the 13% to 15%, according to reports by the major ad-tracking firms.

The recession has hardly dimmed the fact that Internet advertising continues to gain at the expense of so-called traditional media, such as 30-second TV spots or newspaper display ads. One tracking firm, WPP’s Group M, said that online media will go from 13% of all ad dollars this year to 15%, or $65 billion, in 2010. John McDonald, a spokesman for GM, recently told the Wall Street Journal: “The old days of carpet bombing the U.S. with network TV ads and expecting to reach everybody are over.”

Still, most experts agree that merely dropping and replacing traditional media overnight with a strategy that seeks to serenade customers over social networks such as Facebook is too simplistic a solution, as some marketers have already learned the hard way.

“One conundrum for advertisers that they’re trying to figure out is how to get into that conversation — how to get into it and tell the story without annoying people,” says Michael Donahue, who is the executive vice president of the American Association of Advertising Agencies, or the 4As, as well as an advisory board member of the Future of Advertising Project. In fact, Donahue said he organized a seminar around the topic of advertisers, social networking and intrusiveness after his college student son told him that too many profit-seeking applications were spoiling his experience on Facebook.

Indeed, the early findings of the Future of Advertising Project have been challenging some of the current conventional wisdom, including the notion that traditional forms of advertising are dead. In fact, one of the project’s first major efforts — publishing 21 research papers in the Advertising Research Foundation’s Journal of Advertising — included a paper by the ARF’s chief research officer Joel Rubinson on the efficacy of TV advertising; it found there was no erosion of television’s impact in recent years, even with declining audiences and the use of devices like a Tivo player that allow ad-skipping. Another study presented through the project found that the impact of DVR devices like Tivo may not be as negative as marketers have feared, perhaps because brand messages can be effective even as a viewer fast-forwards through them. 

Wind believes the failure to develop innovative marketing strategies that integrate the power of television with the potential of social media is part of a broader structural problem in the ways that large advertising agencies are set up to handle accounts — exactly the type of problem he says will be tackled by the Future of Advertising Project. New knowledge, Wind notes, can help break down the “silos” in the top agencies. “The current model doesn’t work because the mega-agencies have silos that don’t offer multiple solutions” across different media. Right now, there’s no mechanism for bringing these silos within an agency — or across organizations.”

The Future of Advertising Project aims not just to change the techniques that advertising managers use, but also to promote broader and more radical changes in style that are possible in advertising, where a running two-way dialog with consumers is not just possible but critical to success. With the public’s trust in business so badly damaged in the wake of the economic meltdown, Wind is bullish about the potential for advertising to promote social change — such as with the Unilever push for both cleaner clothes and for child recreation. “We’re saying that, in addition to your business message, how can you have a positive social impact?”

The project has evolved since it was launched last year, looking to move beyond the staid formats that academics like Wind are most familiar with, such as published research papers leading up to a printed book. As the effort picked up steam, organizers realized that it needed to be an online and interactive conversation, similar in style to the new ways that advertisers need to build two-way customer relationships over the Internet.

“That’s why I’m using this model to manage the project, to show that we can ‘walk the talk’ of the things that we are trying to document ourselves,” explains Catharine Findiesen Hays, executive director of the Future of Advertising Project. “We are using multimedia to get the word out, and the lesson we have learned is that you have to vary things according to the medium — you don’t just put a TV show into a mobile device.”

One of the goals of the project is to make full use of its global advisory board, a group of some 40 top agency executives, marketing experts and academics who will be contributing their own research by bringing other campaigns or research findings to the attention of the group, as well as offering their own analysis. Hays notes the board’s involvement is critical in the next phase, which involves assembling a detailed data base of papers and case studies of the best practices looking toward advertising’s future.  Project leaders hope that each of the 40 participants can offer two or three significant pieces.

Beyond that, Hays says, the next phase will be to develop the best technological platform to allow both the advisory board members as well as followers of the project to engage in a running discussion about the data and other studies, perhaps similar to the style of group editing that is found on Wikipedia. 

Google Videos

A major goal of The Fast.Forward project launched in a partnership with Google is to take the discussion about advertising’s future online and expand it to a much wider audience. Wind and Hays explain that Google — which generates most of its revenue through search advertising — agreed to get involved in the project even though many of the discussions will promote advertising in other media, occasionally involving competitors, such as Microsoft. “Google feels that providing value to anyone involved in marketing will encourage them to make decisions that will ultimately benefit the company, Wind notes.

Cindy Goodrich, the Google business marketing executive who is working with Wharton on the Fast.Forward project, notes that the search-engine firm got involved in the project because so many executives were coming to Google seeking broad advice on marketing. It decided to partner with Wharton and to help develop a site that is open and democratic, even as it spotlights one of Google’s prime properties — the popular YouTube video site. Indeed, Fast.Forward was modeled after a popular Google-backed site in the United Kingdom called Survival of the Fastest, which features video about best practices and new ideas in e-commerce.

Goodrich agrees that Google executives have no problems with Fast.Forward promoting videos or hosting discussions that call attention to other forms of media and marketing in addition to its own brand of online-search advertising, or even posts about its leading competitors. “We welcome this kind of communication because it makes everybody better.”

When it’s done, the Future of Advertising Project will offer one last reminder that Old Media can be as powerful a tool for marketers as the web or newfangled social media. At the very outset, Wind’s vision for the project was leading up to a book. Even with the YouTube channel and the other high-tech bells and whistles, Hays says that book will be published as planned, for those who still prefer that oldest of media format. “But we won’t just wait for the book,” she adds. “We’re hoping to take the sources of our information and use it — whether it’s on the YouTube channel or in partnership with other organizations.”

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