The Changing Face of Media

The Momentum Effect

Scott Berg — Tue, 01 Jul 2008 14:51:00 GMT

The Momentum Effect

I encourage all of you to take a look at the video and the book “The Momentum Effect” by Jean-Claude Larréché, the Alfred H. Heineken Chaired Professor of Marketing at INSEAD. This is a fascinating way to look at driving the market, growing market share without having to increase investment (e.g. getting efficiency out of advertising and marketing in general). Value creation and innovation need to be considered by all CMO’s as we move forward… emotion has a critical impact on the customer and how we satisfy their needs and requirements. Enjoy!

http://knowledge.insead.edu/TheMomentumEffect080607.cfm?vid=52

Scott

What’s the Most Important Media Type During a Recession??

Scott Berg — Mon, 30 Jun 2008 15:26:00 GMT

With the Dow dropping nearly 20% the US economy seems to be poised for a technical “bear” market. Not that the word “technical” means a whole lot, when you have commodity prices rising driving an inflationary marketplace.

But with that in mind, and with the announcement from Zenith media in which they cut the rest of the years media forecast by .03% (from a previous increase of 3.7% to a revised 3.4%), so what’s a marketer to do? And where should you invest your dollars to maximize the highest ROMI?

A number of factors play into these types of decisions, but let’s hash through a few of today’s market and customer realities.

Gas Prices – with gas prices around $4.00 per gallon, the consumer is trying to combine trips, limit overall travel, etc.
Pocketbook Squeeze – with not only gas going up, but the costs of food, clothing, etc. also being pushed upward, the consumer is searching for the lowest possible cost.

Here’s how and why I’d rank my media choices based on the before mentioned consumer challenges….

Search – allowing the consumer to find the lowest price and/or check the availability of the product before running out can work to your advantage.
Point of Sale – boost up those POS signs in store to drive impulse purchases.
Web Site – ensure your web site is optimized for search; landing pages are extra easy to navigate and drive to checkout quickly. And use the web site to advertise sales, discounts, low shipping costs, etc.
Interactive Banners – driving demand generation banners which allow the consumer to actually purchase the product at a lower cost (while keeping shipping costs manageable) is another way to help the consumer and gain market share. Make it easy, fast and cost efficient.
Radio – it’s cheap on a per GRP basis, easy to target and can be used to get the message out about a sale or discount. The key I believe is to ensure you have plenty of frequency during afternoon drive and be sure to list out locations so the consumer can make a “quick” stop to pickup the item(s). My recommendation… weekday’s afternoon drive/weekends during the entire day part when shopping is at it’s highest.
Newspaper – yes newspaper… but I would use it only on key shopping days such as Saturday or Sunday.

Others that should also be considered but I won't rank include: direct mail, email, etc. All the other media types fall off my list at this point for demand generation, because either the cost is a bit too high or the return is bit too low.

Needless to say, regardless of the media type, you must spend money during recessionary times to make money… they key is investing it appropriately.

Scott

AAF-Ft. Worth, TX Presentation

Scott Berg — Mon, 23 Jun 2008 16:03:00 GMT

I had the pleasure of speaking with the AAF-Ft. Worth Chapter yesterday in Ft. Worth, TX on future media/marketing and advertising trends, etc. I’ve attached my presentation in pdf and the link to the video “Did You Know 2.0” which I showed at the presentation.

The world is changing folks and we as marketers must begin to shape each of our company’s to take advantage of these shifts.

Scott

Media Trends

http://www.hp.com/hpinfo/blogs/docs/AAF_FtWorth_June2008.pdf

Did You Know 2.0 Video

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The End of Pilot… Not the End of an Idea

Scott Berg — Wed, 11 Jun 2008 21:40:00 GMT

As reported by Adweek, the ebay television Ad Sales Marketplace Pilot has been discontinued. As you might recall, myself and other marketing folks from major advertisers helped to drive this initiative along with ebay.

And although this pilot did not meet the expectations of ebay nor the committee, the need for a more efficient manner to exchange media is certainly not dead. You have to look no further than Google and Yahoo! who both are trying to sell media inventory through their own respective systems.

As I read the article from Adweek, I was reminded of a quote by Malcom F. MacNeil,

“The only failure which lacks dignity is the failure to try.”

Scott

Radio – The New Comeback Kid?

Scott Berg — Wed, 11 Jun 2008 21:37:00 GMT

I notice this article from Media in Canada, showing an 8.3% increase in radio advertising in radio advertising in Canada for the upcoming Q308 time period.

The industries with biggest increases included: Restaurants, Alcoholic Beverages, Financial Services, Retail and Automotive.

What’s great to hear is 8 quarters of continued growth in radio advertising… for a media type that has been in decline in general, this is very positive news.

And although this information and trending is for Canada, my hope is that the US marketplace will begin to follow suit in due course.

So what might be driving these increases? A couple of thoughts:

Inventory – TV inventory in general has been tight… radio inventory has been easier to obtain. So hitting campaign GRPs… I can see agencies and clients moving quickly to radio to make up GRPs
Cost – when demand exceeds supply, price goes up (sometimes waaaayyyyy up). That being said radio is relatively cheap on a per GRP rate vs. TV.
Creative – radio commercials are extremely cheap from a production perspective and I don’t know many clients who have seen increases in budgets these days. If anything, most are trying to reduce creative/production costs in order to increase the amount of working media.
Viability – radio is still a viable medium… challenged yes, but also viable.

Scott

I Facebook, Therefore I Am

Scott Berg — Thu, 05 Jun 2008 20:17:00 GMT

I haven’t blogged in a while about my Facebook experience, so I thought I’d give an update.

First, I have a total of 113 friends. And although many of them are more contacts via the business at HP, I have actually had a few friends from the past claim me.

Second, I actually have become somewhat addicted at reading the News Feed posts on my account. I’ve learned a lot of things about a lot of people – nothing scary… but frankly, those little tidbits of information are acting as a way to “connect” or start conversations.

Third, I haven’t loaded up a bunch of photos. I guess with the audience I have it probably isn’t a huge priority. But I did find out from the folks at Facebook that they have around 15 million photos loaded to the site DAILY. Yes, that is correct… DAILY. That easily makes them monster in the aggregation of photo storage. The kicker, most of these folks don’t print the photos.

Forth, my best friend’s teenage daughter friended me… what I’ve quickly noticed is the completely different use of Facebook she and rest of the youth market exhibit. They comment on everything, they let everyone know where their going, what their doing, and they load and utilize a much larger number of apps. Not surprising, but they are literally “connected” all the time. And to boot, they use the mobile function religiously.

Fifth, I believe the platform is viable as a marketing tool… but frankly, banners and such aren’t really the thing I believe will work. Engagement with the audience through a “thread which ties people together” (e.g. a cause, event, or passion point) is probably the best way to use the medium.

Scott

Perhaps the Most Important Words to be Successful in Marketing in the Future…

Scott Berg — Mon, 19 May 2008 19:07:00 GMT

Over the weekend, I was helping my daughter with her 3^rd grade math homework. And the statement which all parents have heard at least once from their children sprang from her mouth “Daddy, am I ever going to use this stuff?” And after pondering the question I answered “Yes.”

I’ll spare you the specific math problems (which by the way, I don’t think I learned until I was in high school) but the short story is she is dealing with Boolean logic and terms.

Via Wikipedia, Boolean is defined as “a complete system for logical operations. It was named after George Boole, who first defined an algebraic system of logic in the mid 19th century. Boolean logic has many applications in electronics, computer hardware and software, and is the base of digital electronics. In 1938, Claude Shannon showed how electric circuits with relays were a model for Boolean logic. This fact soon proved enormously consequential with the emergence of the electronic computer. Using the algebra of sets, this article contains a basic introduction to sets, Boolean operations, Venn diagrams, truth tables, and Boolean applications. The Boolean algebra article discusses a type of algebraic structure that satisfies the axioms of Boolean logic. The binary arithmetic article discusses the use of binary numbers in computer systems.”

If you focus the definition downward into layman’s terms the key words include:

AND
OR
NOT
SUBSET
GREATER THAN
EQUAL TOO
LESS THAN

So all of this got me thinking about the marketing earth being inherited by the techno/analytical geeks. Basically, in terms of marketing “Boolean” logic allows marketers to fine tune the target audience. This is certainly nothing new to the database marketers and mathmaticians out there… but for many, this type of logic will be new and perhaps a bit challenging to understand.

So why should we be concerned about the use of this type of logic in the first place? Let me list just a few of my thoughts…

Segmentation – being able to target and segment messaging and offers to segments will help increase response rates.
Sub-Segmentation – this term really helps define a “subset” of an overall segment. For instance, let’s say your “segment” is to target customers who purchased a desktop computer but NOT a monitor. A subset of this segment, would be those customers who have
Budget – by fine tuning down the segmentation and the sub-segmentation, budgets can be optimized to drive the highest ROI.
Search & Online – you’re probably already using Boolean Logic in search and online programs today… you might just not know it. With all of the data being collected via this marketing initiatives, it is critical to fine tune messages and Boolean Logic helps drive these segments.
“Traditional” Media Properties – as data growth continues in the more traditional media types – e.g. television… the hope would be to utilize Boolean Logic even deeper and integrated with digital media properties to maximize the exposure and targeting of the audience.

If you’re not well versed in Boolean, I would recommend you spend some time with your database marketing folks and actually have them walk you through some examples in order for you to gain an understanding.

Also, to all readers of HP blogs, we will be migrating to a new platform in the coming week or so. So as of May 23^rd, I won’t be posting to my blog and won’t be able to receive any comments submitted. Please hold your comments until June 1, when our new site will be live.

Scott

Boolean Logic George Boole Wikipedia Database Marketing Analysis Hewlett Packard HP advertising marketing targeting television search online digital segmentation media Scott Berg

Visual Oriented Search

Scott Berg — Mon, 05 May 2008 20:15:00 GMT

Recently, I was forward the following beta search site address which is in development by Searchme.

http://beta.searchme.com/

And although it’s in the infancy, I’m fascinated on the direction(s) search is starting to take…. Where search begins to be even more user friendly and visually appealing. I liken the results produced to scrolling through an iTunes music and movie library.

If search can became more visually oriented then we as marketers should begin to focus attention on providing advertising/sponsored “links” which are equally visually appealing to the consumer in these environments.

Food for thought….

Scott

Marketing media search advertising iTunes visual search Hewlett Packard HP paid search sponsored links Searchme Visually Oriented Search Scott Berg

From Pet Rocks, Mood Rings, Beanie Babies….to Webkinz

Scott Berg — Thu, 01 May 2008 16:50:00 GMT

For those of you who have kids under the age of 12 probably have been hit in the pocketbook by the newest trend…. Webkinz.

My kids are both fanatics about their lineup of Webkinz animals and I’m sure that this fad will pass in time, but for today I'm stuck shelling out for a host of stuffed animals.

First a bit of background…

1. What is a Webkinz? It’s a stuffed animal(s).

2. What makes them different than the other thousands of stuffed animals my kid has lying on top of their bed? Well, those pesky little varmints’ have an online component. You register them on the Webkinz site, name them, etc.

3. So what’s the big deal with that? The makers of Webkinz, GANZ, allow your kids to interact with the stuffed animal in a “virtual” environment. They can feed them, take care of them, chat with other kids in a controlled environment, etc. In addition, kids can play games, decorate a room, use trading cards to interact and play, etc.

What I find particularly intriguing about Webkinz, is the interlinking between an offline product and an online virtual world. They’ve found a unique way to extend the life of the toy, create a social platform for children as well as a destination site to keep the kids coming back.

I also like the fact; they can use the website to promote new products, cross-sell, etc. while making the kids feel a part of a community. Plus, the site and the in-store products are international, making scale as easy as normal product distribution.

Scott

P.S. I’m still waiting for the pet rock trend to re-appear!

GANZ Webkinz toys stuffed animals social media interactive digital advertising community virtual marketing media HP Hewlett Packard Scott Berg

Decline in Newspaper Advertising

Scott Berg — Mon, 31 Mar 2008 15:57:00 GMT

Caught this article on the decline in newspaper advertising for 2007 -- a whopping 9.4% This decline is noted as the largest year-over-year decrease since the tracking started in 1950.

The Newspaper Association of America provided the information and some thoughts around the decline – including economic challenges, shift to digital, etc.

Scott

HP Hewlett Packard media marketing newspaper Newspaper Association of America Scott Berg advertising digital changing face of media

Kiva.org – The Power of Social Networks

Scott Berg — Wed, 26 Mar 2008 14:45:00 GMT

I recall an episode of the popular TV show M*A*S*H in which BJ and Hawkeye were trying to get a US serviceman from taking advantage of the local Koreans…., the serviceman said something along the lines of “you guys can’t change the world?” in which Hawkeye responded “No, just our little corner of it.”

For a long time, I’ve looked back on that episode and asked how could I help others around the world? I was searching for a way to really help “change” someone’s life – not just rescue you them from a disaster, but have them become self sufficient.

(Ok, let’s stop for second… keep reading…. This isn’t about trying to get any of you to contribute; there is a real social marketing message around this.)

Well I found it… an organization called kiva.org. Basically Kiva.org is a micro lender which consolidates small amounts of money from many individuals into business loans to those in developing nations. We’re talking about loans in the $100 - $500 as near as I can tell.

The borrowers get the money after a business plan has been approved by a local lending representative. Then they make payments back to kiva.org and the money is “paid” back to those who lent the money. From there, you can take your money off the table or re-loan it to another person. You don’t get any interest with the loans, but the payback you receive is so much larger – the satisfaction knowing you were a small contributor to the betterment of someone’s life – allowing them the chance to start a business which will contribute to them making a living.

My two loans are currently about half paid back after only 3 months.

Now here is the social media point…What amazes me is not only the power of changing lives through the loans provided, but the “social” network kiva.org has created in the process. The members who participate are tied together by the power of helping others. I’ve even received comments from others talking about the progress of the individuals we’ve co-lent to, etc.

I have a Facebook page, Linkedin.com, etc. And those sites are tied together by people trying to connect or network to one another, kiva.org is a site that is based on an action – helping others, not on networking. This is profoundly differently and powerful.

If we as marketers could tie our customers together with a common action think of the possibilities,

Scott

Media marketing advertising emerging technology social media kiva kiva.org facebook linkedin micro lending HP Hewlett Packard Scott Berg

Paying a $540 CPM & Loving It! (For Now)

Scott Berg — Wed, 12 Mar 2008 21:55:00 GMT

Any media strategist or planner worth their weight is always geared towards maximizing the media exposure while at the same time reducing expenses – thus driving the ROI or ROMI (Return on Marketing Investment).

Let’s take a few media types and just put a very “general” CPM (cost per thousand) to them:

TV -- $20 - $25/CPM

News Weekly Print -- $70 - $75/CPM

So why would any client and/or media planner want to spend $540 per CPM? Well that’s exactly what many do when they purchase search. You see the average cost per click for all search terms is estimated to be $.54 cents across the internet as reporter by emarketer via an article from The Rimm Kaufman Group. You multiple that by 1000 and you get $540 per CPM type of measurement… might not be perfect, but hey it’s in the range! And for all of my search friends… yes I understand how you measure the performance of search… but let me play media planner for this article.

Why are we willing to “belly up to the bar” and pay an average $540 per CPM. Couple of reasons:

Search is typically “action” oriented… the end user “clicks” on the advertisement to obtain additional information, purchase or do something.
It’s track able! Usually to the ROI level.
It’s a targeted media choice… vs. other media types which tend to have a general audience lumped together.
Not all CPM’s are created equal…. Just viewing a TV spot (which you really can’t track specifics anyway) has less value than actually doing something as is the case with Search.
Search can tie together the other media types.

All of the above justifies a higher valuation by agencies and advertisers.

That being said… let’s look at the other side of the argument. As marketers continue to drive for efficiency out of their marketing cost envelopes, I question whether the search premium currently being paid is worth it? Should we pay a premium if we’re using search for brand awareness? Will those steep valuations decrease over time? And what happens if other media types are able to fine tune their targeting like search? What will that do to the cost model? How can we look to bring down the current CPM for search to increase efficiency?

As marketers we’ve spent a great deal of time, driving down our “traditional” media CPM’s, as we continue to move more dollars into the digital space we should equally be concerned about driving exceptional value from search now, vs. playing catch-up years from now. Metrics, measurement and efficiency are on the minds of all marketers and other media types are beginning to really drive targeting to a new level. That in its self might drive more parity between the media types, but until that day… search will have a leg up given its strong metrics component.

Scott

TV interactive search CPM cost per thousand media marketing advertising brand awareness direct response valuation HP Hewlett Packard ROI ROMI news weekly print Scott Berg emarketer

The Rimm Kaufman Group

2008 Media Predictions Update – How Am I Doing??

Scott Berg — Tue, 11 Mar 2008 19:52:00 GMT

If you recall, I posted my 2008 Media Predictions December 10, 2007. I thought it would be good to “keep me honest” and see how half of those predictions are doing.

Prediction 1: More TV time and interactive space will be purchased by political candidates than the gross domestic product of Serbia.

· RESULT: The GDP of Serbia is about $21B, near as I can tell…. And although the candidates have spent a considerable amount on media…at this I have no confidence they’ll spend that amount… but who knows.

Prediction 2: TV Executives will settle the Writers Strike shortly… to not do so would dramatically impact the US TV upfront.

· RESULT: Got this one correct… and the show will go on.

Prediction 5: More content companies who currently charge the consumer for viewing content will move from the subscription based model to an advertising based model.

· RESULT: Not seeing this one take hold yet.

Prediction 6: Marketers will continue to shift more dollars into digital/interactive media programs – probably an additional 3-5% in FY08.

· RESULT: Intuitively, I believe this one is on track… although we’re only in the first quarter, but when the likes of Ziff Davis file bankruptcy because they’re not getting enough print advertising revenue, the dollars are going somewhere.

Prediction 8: Interactive and digital headcount will continue to be constrained throughout the year, driving people costs higher.

· RESULT: See any employment board and you’ll see the constraint in supply the industry is dealing with.

Scott

media predictions FY08 interactive search digital TV US Upfront Writers Strike advertising agencies media marketing HP Hewlett Packard Scott Berg update

Who’s Got the TUMs?

Scott Berg — Wed, 05 Mar 2008 20:33:00 GMT

I was somewhat alarmed by an article I read in BusinessWeek this past week titled “An Ad Man Tests the Limits.”

The article is about CEO of GroupM, part of WPP (WPPGY) – a powerhouse of a media buying house, purchasing some $60 billion in media per year.

You can read the full article yourself, but I’d summarize the article this way.

- GroupM CEO Irwin Gotlieb is trying to arrange “volume overrides” (aka rebates) bonus payments back to his agency for media volume in the US – this might be through extra spots, media research for the agency, or cold hard cash.

Of course the article points out that these rebates might go to GroupM vs. clients in an effort to boost bottom line profits for WPP. It also points out the possible alienation which might occur with clients if the rebates are applied to WPP’s bottom line and not to the benefit of their clients.

So here’s my take on this “sticky wicket” as they say in the UK.

One of the big benefits which media agencies claim is they can get lower prices for all clients by aggregating the spend between them. In other words, paying wholesale vs. retail prices based on volume.
So if number 1 is true (and let’s suppose it is), shouldn’t those extra spots, cash and benefits be divided up between clients? I think so. Client companies are the ones actually paying for the spots, and also paying fixed fees to hire the agency staff to drive the media. I like to use the analogy of a bank… It’s a bit like the old banking 3-6-3 proverb. Banks pay you 3% in interest on your savings, they lend the money at 6% and they make 3% (or we use to say “be on the golf course by 3:00). And that’s a banks job – that’s how they’re business is setup. But it isn’t the premise on how a media agency is setup. If it is and a media agency wants the bonuses, perhaps clients shouldn’t pay fixed fees?
Clients should demand transparency in the financial dealings with any and all media agencies. It’s good business.
Clients rely on media agencies to make decisions in the best interest of the client… if they have a decision to make an extra buck by picking one media partner over another, how can a client be sure they’ll make the right decision?

My mentor Terry Puster uses a great quote “I don’t want the stomach acid”… that pretty much sums up my thoughts on this…, re-constituting bonuses that don’t go back to the client or are not transparent is only going to increase the stomach acid in the belly’s of clients.

Scott

GroupM Irwin Gotlieb media volume overrides rebates WPP transparency Terry Puster Scott Berg marketing advertising HP Hewlett Packard

Kellogg on Advertising & Media

Scott Berg — Tue, 26 Feb 2008 15:03:00 GMT

About a year ago, I was asked along with a lot of folks smarter than myself, to participate in the writing of a chapter for the new book “Kellogg on Advertising & Media.” The area I focused on was Advertising in the World of New Media. It was a great honor to have been approached to contribute to book.

A few of those who also contributed include:

Michael Schreiber - NBC Universal

Claudio Marcus - Visible World

James Webster - Northwestern University

Angela Lee - Northwestern University

Michelle Roehm and Alice M. Tybout - Wake Forest University and Northwestern University

Daniel Diermeier - Northwestern University

Clarke Caywood - Northwestern University

James Newcomb- Boeing

Charles Spinosa, David Le Brocquy, and Bobby J. Calder - Vision Consulting and Northwestern University

Julie Roehm

If you’re interested in purchasing the book you can find it at the link below:

http://www.wiley.com/WileyCDA/WileyTitle/productCd-0470119861,descCd-tableOfContents.html

Personally, I’d like to thank Claudio Marcus at Visible World who recommended me as well as Bobby Calder at Northwestern University for allowing me the distinct privilege to participate.

Scott

Kellogg on Advertising and Media Northwestern University Visible World NBC Universal Wake Forest University HP Hewlett Packard Scott Berg