Working Media no longer works on its own. This is far greater than a media buying challenge. It is actually one of the biggest issues facing every marketer today regardless of size or industry.
We used to maximize the ratio of working to non-working as best we could.
Non-working media includes costs related to production, talent, promotions and fees paid to agencies. Working media is – plain and simple – paid media, otherwise known as the dollars paid to media partners in return for media impressions.
The old calculus – or current calculus depending on who you are – referenced that 80%+ of any budget should go to fund working media. For the day, that was completely appropriate. It was foolish to spend money for line items not directly leading to exposure among a target audience. For decades, we were basically buying GRPs dressed as a middleman intended to lead us to our goals: awareness, intent and purchase.
At that time, our industry counted TV, radio and print as its workhorses. Radio and print, while still player, have been largely replaced by digital as the new thoroughbreds of the media mix – specifically: online, mobile and social. The difference between the old guard and the new one is engagement. Nobody has ever engaged with a radio spot or a print ad. They may have taken action, but they could not do so within the unit itself. Digital changed that landscape starting with the earliest banner and has been changing it again and again ever since. Even TV, now and forever a critical factor in achieving marketing objectives, is more effective when paired with digital.
THE NEW CALCULUS
Building relationships is the new marketing. Engagement is the means that gets us there. Today, we must start and join conversations, and then tend to them or else we will find ourselves on the outside looking in. We do so by bringing value to conversations. Otherwise we are a party guest that neglected to bring a gift for our host and whose sole contribution was standing around talking about ourselves the whole night.
Value is a vague and benign term without definition. My colleagues and I believe there are three kinds of value: 1) an offer, 2) content and 3) a service or experience.
Nike Plus is a service that delivers value. Small Business Saturday is an experience that delivers value. A live streamed concert is content that delivers value. A ‘friends & family’ coupon is an offer that delivers value.
What do all of these things have in common? They require non-working media to make them happen: production, technology, conversation management, a monetary incentive. Line items like these can take the ratio from 80/20 (working to non-working) to 50/50 or beyond. But funding them is critical for a brand to be successful in building and maintaining relationships with customers and prospects.
This is the new calculus. And the math works.
Nike+ Fuel Band launched with earned media baked into the product itself. Sync your daily fuel points and broadcast the results to your social following. This instance of value-based marketing helped propel the product to sales so strong, it was back ordered immediately following launch. Small Business Saturday, made offers available to American Express Cardmembers and merchants alike, and drove 67% awareness in the U.S. this year. More importantly in terms of demonstrating ROI to the company, $5.5B was spent in small businesses on that single day and swipes of Amex cards rose 21% from the year before. Those are impressive statistics largely driven by social marketing with value at the center. How many ad-driven campaigns can claim this kind of participatory action? These are just two examples, but hundreds of others play out in similar fashion.
WHAT BRANDS SHOULD DO
Have the guts to shift the mix. That dinner guest who talked about himself all night? Nobody likes that guy and he usually doesn’t get a second invitation. Serving the community must be on par with serving the brand. The best sales pitch is not a sales pitch at all. Your brand must not be in constant sales mode – in the age of the Facebook News Feed, doing so is both jarring and conspicuous. Instead of Always Be Closing, try Always Be Creating. Do so by building value into your budget: make films, give access, provide offers, host chats, lend expertise, do things that are special. Those special things will get people to engage, share, recommend and advocate – turning non-working investment into earned media that is often far more impactful than the paid variety.
Leverage your working media to help fund your non-working investment. For brands spending tens of millions of dollars on paid media, a great foundation is already in place. Choose your paid relationships wisely and you can unlock many of the assets you need to make the engine work. Yahoo!, NBC and Buzzfeed are content engines. YouTube and Facebook are leveragable owned channels. Twitter and LinkedIn are centrifuges for conversation. Investing paid media dollars with these partners not only provides paid impressions, but can also be used to deliver the content and technology needed to drive these new relationships between brands and audiences.
Find ways to demonstrate ROI in the new ratios. What makes this shift challenging is that brands have a difficult time justifying it. Spending a greater share on anything but eyeballs goes against the well-worn conventions of advertising. So: prove it. Start smaller if that is best – a trial, some smaller investment of funds. Put the right measurement in place so you are creating attribution for key back-end metrics – not just awareness. Awareness may have worked to sell television buys to CMOs for the last 50 years, but it does not and cannot stand alone as a rationale for something as complicated as changing the very ratios our industry was built on. The value-based marketing world does not have a single source measurement champion akin to Nielsen, but it has hundreds of companies working to demonstrate this value. Find the ones you like, throw a saddle on top and ride.
Look to the pioneers. There is an old business story suggesting that, for years, Burger King did not scout its own locations, but rather looked to see where McDonald’s was setting up shop and then followed suit. Following the leader saved them resources. In marketing, many top brands have been laying the groundwork – first in trial and, now as a matter of course. Nike, American Express, P&G, Starbucks and Pepsi have all embraced the shift. If they are moving their dollars to reflect the new calculus, they have likely proved the theory, and it should now be safe for other marketers to do so as well.