Peter Field, President, Field Consulting
What will drive the future of advertising is what works best in hard business terms: most importantly, profitable growth for brands. It is already becoming clear that this is often not the same as the latest over-hyped addition to the marketer’s arsenal. So to predict the future we need to study what success patterns are emerging amongst new campaigns and we need to engage common sense about what will not change in the future.
10 years ago we were told that advertising is dead and search is the future. Well that hasn’t happened and Google now readily acknowledges how powerful TV advertising drives search: case study evidence suggests that the two together are enormously more powerful than either alone. For that reason both will continue to prosper as marketing media. Online banner advertising came and went as the next future of advertising even more quickly. Yet we were told that its efficiency (thanks to the ability to target the ‘right’ consumers with minimal wastage) and measurability (immediate click-throughs) gave it advantages that conventional media could not match. Both of these ‘advantages’ turned out to be highly questionable, to say the least. Now we are told that Social Media are the future of advertising, despite the fact that in 2011, amongst the global advertising effectiveness competitions monitored by the World Advertising Research Centre (WARC), campaigns that used social media were less likely to win effectiveness awards than those that did not. When will we stop believing the hype and get back to using common sense and the considerable body of knowledge that now exists about how human beings make brand choices?
What the proponents of all these false dawns have forgotten, is that brand preferences are built up gradually and primarily through emotional brand associations in the brain: system 1 in the language of Daniel Kahneman. Any brand wishing to disrupt embedded consumer preferences with a single ‘efficient’ impression will need to make a very strong rational offer (usually a price deal): capable of sufficiently activating Kahneman’s system 2. This of course is often how brands use online channels (buying ‘likes’ with promotional incentives and so on). But in addition to growing consumer resentment of commercial intrusion into personal social media networks, there is an even bigger problem with this. Marketing’s primary and most profitable role is to reduce the price elasticity of the brand, enabling it ideally to sell greater volume at higher profit margins. Increasing volume sales by sacrificing pricing is not difficult, but it is highly damaging to profitability and tends to lead consumers to expect ever more impressive cuts in future. Far too much marketing spend already goes behind this kind of activity. The growth of location-based social media services will undoubtedly unleash an orgy of short-term transactional ‘deal’ messaging from brands. This will be a big mistake and is likely to distance brands that engage in such intrusive behaviour from their customers. Social media are personal, their appeal driven by the ability to connect people with others. Brands that want to thrive in this space have to earn their welcome through the continually refreshed offer of social currency: ideas that people want to share with others. Location-based media have great potential as social currency tools for brands that are smart enough to use them in this way, but their success will depend on their ability to refresh the brand identity in ways that consumers find engaging. Creativity is a vital element of this and is already rightly assuming a much-enhanced importance in campaign and agency selection.
The future of advertising will therefore depend more and more on the development of ideas that have the power to inspire sharing and buzz. These are already proven to be the most profitable type of campaigns, not just because the are very efficient at growing market share but also because they have powerful effects on price elasticity: people are prepared to pay more for the brands that everyone is talking about. In this future, technology will be the slave of the idea: sometimes a particular comms channel will suit the idea and other times it will not. Nobody will start out asking ‘what is my social media strategy?’ Instead they will ask ‘what is my brand idea and which channels will most powerfully promote it?’ There will be a continuing role for some very old comms channels and of course exciting opportunities for new ones yet to be invented, but none will dominate. Perhaps though, common sense will come to dominate. Now that would be progress.