That desire not only is prompting marketers to shift funds from traditional measured media to the Internet; it also underlies the unabated, two-decade-long transfer of marketing budgets from mainstream media advertising to promotions. Media companies and ad agencies used to dismiss the rise in below-the-line spending as a phenomenon driven largely by retailer demand for trade promotions. But the spending shift from major broadcast and print media to below-the-line marketing expenditures owes more to the fact that marketers can more easily measure and prove the value of most below-the-line spend.
Online media technology reinforces the trend toward integration. Although the dichotomy between “brand building” (advertising) and “moving the goods” (promotions) that characterized spending decisions in the old days was always relatively false (L.L. Bean is one of scores of companies that have built enduring brands on the back of promotions efforts without traditional advertising), any distinction disappears in interactive environments, where all communications can be designed to prompt an action. Whether in heavy consideration categories (automotive, travel, personal finance) or impulse-buy categories (specialty foods, packaged goods), marketers can now deliver contextually relevant messages and product information to only those consumers who are interested in choosing a Lexus, planning a trip to France, or searching for organic cotton diapers, and they can measure the actual results, instead of survey-extrapolated estimates.
New outcome-focused metrics are emerging on both the buy-side and sell-side of the marketing gulch. They include:
Session quality (for example, brand retention, number of ads viewed per session, and type of advertising content viewed)
Degree of consumer cross-platform activity (TV to online and print to online)
“Opt-in” activity (online registrations, toll-free calls, and requests for information)
Sales impact (leads generated, store traffic, and volume lift at retail stores)
Such is the proliferation of new measurements, new measurement techniques, and new measurement suppliers that the industry may be on the verge of a near-term glut in metrics that transfers precious capacity away from productive activities and creates a cult of accountability. That overindulgence will probably be short-lived, and most companies will settle on the set of metrics that are right for them. At the front end of marketing planning, these new metrics mean greater accuracy in judging impact, more finely tuned objectives, and less waste in budgeting. At the back end, the new metrics allow marketers to better estimate the degree to which objectives have been met. They can develop improvement measures, scale up R&D endeavors, and work with consumers more effectively than they have in the past. For their part, media companies can more effectively price their offerings on the basis of a range of objectives and results.
Much as in the early days of television, when Procter & Gamble produced its own soap operas to showcase its products in situ, marketers today are appealing to consumers directly by creating their own programming venues and assets. Although we’re not likely to see many marketers and media companies converge (the ill-fated merger of Columbia Pictures and Coca-Cola in the 1980s remains a cautionary tale), there is no question that more marketers will inform and entertain their consumers directly. Blue-chip brand marketers such as Coca-Cola and Mercedes-Benz are already major players in the digital music arena with mycokemusic.com and mercedes-benz.com/mixedtape.
But the focus is not just on music. Marketers such as P&G have developed their own magazine-like capabilities. With 4 million opt-in e-mail newsletter subscribers, P&G’s HomeMadeSimple.com ranks in reach and influence with the leading women’s service periodicals — the magazines in which P&G has for decades been among the top advertisers. A destination environment focused on Procter & Gamble’s home-care portfolio, HomeMadeSimple.com is chock-full of contextually relevant product information, community stories, household ideas (recipes, tips for storing antiques, etc.), and related promotions — even music by Diana Krall and Harry Connick Jr. It generates a treasure trove of consumer insight for P&G that is entirely proprietary.