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Published: February 24, 2009

 
 

Digital Darwinism

Becky Saeger, chief marketing officer of Charles Schwab & Company, asserted at a recent ANA panel discussion of the “Marketing & Media Ecosystem 2010” study that the client must play the role of quarterback “whether we want to or not, because the fragmentation is so intense.” Co-panelist Steve Sullivan, senior vice president of communications at Liberty Mutual Group, agreed: “Today’s marketing plans are much more like a mosaic of thousands of little pieces. And you’ve got to figure out which ones go where and what the patterns are, and then glue them all together.”

Already, leading marketers are investing in capabilities that bridge the gaps between media, creative, and brand strategy. The savviest companies will develop an internal “integrator” position (which could reside in communication planning) and will appoint senior media leadership.

Other marketers will rely on their advertising agencies to play this integrator role, at least in selected circumstances. For a recent deodorant product launch, for example, Unilever PLC hired one agency to serve as the “conductor,” integrating all the other agencies and elements of the campaign. This conductor agency was responsible for the budget, the time line, and the overall execution of the entire program. Kevin George, vice president and general manager of the company’s combined antiperspirant, deodorant, and hair care business, acknowledges that it was initially “politically challenging for our other agencies, but it gave our brand teams one point of contact, which saved a great deal of time, strain, and complexity on our end. This is not the right ap­proach all the time, but we gained a lot of learning about a different way of working.”

Dell and WPP pursued a different route. Frustrated with the sheer complexity and loss of efficiency associ­ated with coordinating the efforts of some 800 providers of marketing services, Dell put its entire account up for review. It ended up awarding a budget of $4.5 bil­­lion over three years to a brand-new bespoke agency, Enfatico, that was created, staffed, and fully customized to Dell’s needs by WPP. This agency is devoted to Dell and Dell only for the term of the contract.

Media companies are also stepping up and taking on greater responsibilities in integrating various campaigns. Media companies sit atop a mountain of valuable data on consumers; they have direct visibility into what consumers want and do, so there is a substantial opportunity for them to provide insights and consultative services to marketers and agencies. In the process, they can benefit their own ad sales efforts. In fact, three-quarters of media companies recognize the importance of providing insight into consumer behavior to marketers and believe they should have a role in doing so — a view, incidentally, not shared by the majority of ad agencies, which believe that this responsibility lies primarily with them.

Navigating the New Ecosystem
It’s not just digital media companies that are in the vanguard of such innovation. The Meredith Corporation, a publisher of women’s magazines, has in the past couple of years acquired five digital agencies specializing in customer relationship management, word-of-mouth marketing, custom health care, and online marketing. Now Meredith can not only offer advertisers such as Kraft Foods Inc. the opportunity to reach women through Better Homes & Gardens and Ladies’ Home Journal; it can provide clients like Kraft with a variety of digital solutions and related agency services as well. The benefits to Meredith are twofold. The company can broaden and deepen its relationships with key advertisers, and it can expand into revenue streams that go well beyond print advertising sales.

In the near future, marketers will need to develop an understanding of which capabilities they should keep in-house (e.g., those that can achieve scale across the portfolio and that create essential advantage) and which should be outsourced to external marketing, media, and technology partners. Agencies and media companies, in turn, need to open their minds to alternative ways of working with marketers and one another, ways that are more strategic, solutions-focused, and streamlined.

 
 
 
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Resources

  1. Booz & Company, “Marketing & Media Ecosystem 2010: ANA Annual Meeting CMO Roundtable (PDF),” October 2008: Presentation detailing the survey data.
  2. Matthew Egol and Christopher Vollmer, “Major Media in the Shopping Aisle,” s+b, Winter 2008: Overview of new marketing initiatives in retail locations showing how one corner of the ecosystem is being transformed.
  3. Leslie H. Moeller and Edward C. Landry, with Theodore Kinni, The Four Pillars of Profit-Driven Marketing: How to Maximize Creativity, Accountability, and ROI (McGraw-Hill, 2009): Detailed guide to practices and organizational processes needed to implement marketing metrics and increase accountability for marketing spend.
  4. Christopher Vollmer, with Geoffrey Precourt, Always On: Advertising, Marketing, and Media in an Era of Consumer Control (McGraw-Hill, 2008): How the digital age has reshaped all marketing imperatives and the industry as well.
  5. HP advertising campaign (video)
  6. Nike Web site: Online community for runners that gives Nike key insights into that target market.
  7. For more articles on marketing and sales, sign up for s+b’s RSS feed.
 
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