Australia

Technology has encouraged huge change in the communications landscape lately, and impacted on the behaviour of consumers. We all need to be conscious of this changing landscape and evolve our thinking regarding investment decisions. For all the interest and 'expertise' in our market on reach and frequency concepts, there is actually very little empirical or theoretical research available.

And that which is available is limited by being heavily based on TV advertising research.
The theory of effective frequency suggests that an advertisement needs to be seen by a consumer a certain number of times before effective communication takes place. The theory expects a magic number: the opportunity to see (0TS) level which provides the most cost-effective uplift in sales, and the search for this magic number dates back to the sixties.

Over the past few decades the magic number has been two, then three, then one for a while before one was ridiculed. In the mid-nineties the word recency appeared in the debate. Recency assumes a very rapid decay of ad effects says after a week, an 0TS no Longer has any effect.

Therefore, effective frequency became one again. This said there is no question that the first exposure is the one which usually has the most impact. The summary of the collective research is that effective frequency can range between one 0TS for maintenance brands, to seven or more 0TS for launch or restart brands.

But more often than not, agencies and clients will tell you they target "somewhere between two and three 0T5'l Very rarely wilt anyone ever be able to tell you why this is. Our marketplace is worth billions and much investment is made against certain effective frequencies because of the "the rule of three" or "it's what we've always done.  If this sounds familiar to you, be very concerned.

The reality is that effective frequency for a campaign varies by media and depends on a variety of factors: brand development, market conditions, co-marketing and creative quality. There are no generic solutions - we will always need to adjust the frequency to the brand and market.

Unfortunately this is where laziness kicks in, and real work into effective frequency gets thrown into the ‘too hard ‘box Truthfully there is no magic number and all generic solutions are wasteful.

Brands have to understand the complexity of their environments. Modelling must be used, or you are just using guesswork to spend your money.
 

Why we need to be making, prototyping and programming our way through digitaria
It was Great Britain’s Prime Minister Harold Wilson who said that a week is a long time in politics.  I’m not sure what Wilson would make of a week in digital.  The last seven days has seen the launch of Google+ pages, a tie-up between Microsoft, Yahoo! And AOL to take on Facebook and Google by selling each other’s unsold display ads, the launch in Australia of Microsoft’s Ad Exchange and the announcement that Google’s Creative Labs will open its doors down under in January spearheaded by none other than Google and YouTube Creative Director Tom Uglow.

We live in unrelenting times.  Times that call for change.  Times that call for those of us who work in media and communications planning to change.  Times that call for us all, to become doers.  Let me explain…

On Tuesday evening I was lucky enough to be invited to play at Google’s Creative Sandbox at Sydney’s Carriageworks.  On display, or rather at play, were the latest innovations from Google Wallet, YouTube, Google Maps, Google TV, Chrome, and Double-Click.
Giving the keynote speech was Ed Sanders of Google’s Creative Labs in New York.  Sanders shared Labs’ approach to the ideas they develop, ideas that have included the Wilderness Downtown with Arcade Fire, Chrome Fast, Google Gravity, Translate for Animals and Epic Docs (if you haven’t seen the latter type ‘epic docs’ into your search engine of choice, sit back, and enjoy).

Sanders cited Epic Docs as an example of showing not telling, one of several principles that underlie what Labs do and how they do it.  Don’t describe what can be done, do it.  Don’t imagine what could be made, make it.

It was a sentiment echoed by CCO / Partner at Crispin Porter + Bogusky Jeff Benjamin who spoke at this week’s NineMSN Digital Media Summit.  One of fourteen observations from the self-professed nerd was that “Inventions don’t live on paper”.  His advice is to prototype fast and prototype often, and noted that “everyone is an inventor”.
Sanders and Benjamin’s comments reflect a quiet revolution that’s been building momentum for several years.  People all around the world are making things.  In a world presciently described by Cory Doctorow in his book Makers, in which Perry and Lester invent Boogie Woogie Elmo dolls that drive cars and seashell robots that make toast, people are designing and creating anything and everything they can imagine.

In this Etsy-shaped world, people are inventing with open source microcontroller platforms like Arduino.  3D printers – that allow you to open-source 3D designs and then print three-dimensional items for you and your friends – are not just real but about to go from innovator to early-adopter in their adoption cycle.  And why wouldn’t they?  Why wait for someone else to invent and make something when you can invent and make – and sell – something for yourself.

Inventions don’t live on paper – and neither, increasingly, do ideas.  This digital life is making makers of us all.  As both Sanders and Benjamin observe, success relies more than ever before on being able to show not tell clients and co-collaborators our ideas.  Success now relies on being able to prototype fast and often to demonstrate what’s possible.
The great opportunity offered by this maker revolution presents an equally great challenge … we must learn to make – and with that comes learning and whole new sets of skills.  I’m afraid people that it’s time to call time on the fifty page PowerPoint decks, time to throw down the shackles of bullet points and builds.  It’s time to pick up a new set of tools.

In a Hang-Out conversation at the end of his presentation at Google Creative Sandbox, Sanders discussed that one of the problems in this new world is that developers talk a different language to the creatives.  He observed that “at what point do you bring in the developers is the wrong question … the better question is what is your mix of creatives and developers?”

It’s a question that’s not just relevant for agencies but for any of us personally.  This fast-paced and relentless digital life is making doers of us all.  But let’s not look our children’s children in their doting eyes, and say we took part in the revolution because ‘digital made us’.  Let us take part in the revolution and become fully-fledged makers of things, because we can.  Because our work is better for it, because brands are stronger for it, and because the world is brighter for it.
This digital world belongs to the makers and the builders.  It belongs to the designers and prototypers.  It belongs to the programmers, and it belongs to the doers.

My name is Chris Stephenson, and I’m a doer.

On Tuesday morning this week, I had the pleasure of giving thanks to lnternational Advertising Association guest speaker Darren Woolley from Trinity P3, a company that monitors the performance of ad agencies for marketers and conducts ad agency reviews. A mixed audience of agencies, clients and a few procurement people were in attendance.

Woolley was his normal, feisty self in discussing the core theme currently driving marketing businesses. Most are concerned with media fragmentation, which means advertisers need to do a lot more with less money. ln some cases the procurement process we are all facing in the business is driving the cost down, while potentially devaluing the work we do versus enhancing the value we can bring to a client's business. Woolley made the comment that low cost usually gets you the worst people working on your business.

As such, agencies are caught in a downward spiral on fees with few willing to take a stand, instead taking the 'win at any cost'approach.What does this mean for the media agency business? Woolley said we need to value our work and ourselves. He believes we cannot and should not get caught in cost-based models, as we offer a value proposition and should give evidence of this to clients.

lf an ad account pitch calls for a type of fee structure, he said, this doesn't mean we shouldn't take a risk and go in with an alternative approach - providing it is backed by solid key performance indicators. He also suggested that we need significant performance-based incentives for agencies versus break-even
scenarios, as incentives give agency people a goal to strive towards. We like that model, which, at PHD,
means we have skin in the game.

Just as importantly we need to link our key performance indicators to our clients' KPls. Their success is our success. There should be good upside and financial gain for agencies when their clients perform well, rather than a gold star and a pat on the back at the end of a period of double-digit growth. At PHD we know that when we value ourselves, so too will our clients; our people will become more effective
and our clients will see better results linked to their business.

This is a quite simple but logical philosophy that we should investigate and implement where appropriate, to ensure the very best results are obtained for our clients and for our staff, who are the key stakeholders in our business.
 

How media is more part of the message than ever before

The first voice you hear on Bjork’s latest album – Biophilia – isn’t the voice of the pint-sized Icelander, but rather that of David Attenborough, who describes and explains the concept of the album as you sweep through a 3D rendering of the album’s cosmos.

This is Biophilia’s ‘mother app’; a mobile and tablet application that houses not just the Biophilia album, but builds a startling experience around it.  It’s beautiful, and far from getting in the way of the music, augments it by creating a richer and more immersive experience around it.

Bjork isn’t alone.  Stephen Fry’s book The Fry Chronicles exists as an application called MyFry.  As Fry himself points out “Instead of reading my book in a boring old beginning to end fashion, we thought you might like to read it backwards, or upside down, or from the inside out – and back again.”  Like Bjork, Fry is using digital technology to build an experience around his content – an experience that becomes personalised when placed in the hands of the consumer.

Like Bjork and Fry, a host of artists are finding ways to put us in the driving seat.  JK Rowling has created Pottermore, which – as well as being an online sales portal – will enable anyone to create and contribute to the Potter Universe.  And Arcade Fire have invited us to create our own music video with the Google Chrome experiment Wilderness Downunder.
Brands are also capitalising on the opportunity.  Tipp-Ex invited us to decide whether or not to shoot a bear in a YouTube video – a decision that was followed by an invitation to ask a bear to do pretty much anything we could think of.  Thanks to the innovative YouTube packaging, the bear largely obliged.

Commonwealth Bank has a wealth of content around property investment, but rather than passively deploying it they have built Investorvillle.  The ‘property investment simulator’ allows you to use actual realtime property data to learn the basics of investing in property within the context and experience of an online game.
What all of these examples have in common is a radically user-centric perspective; content hasn’t been developed in isolation but rather within the context of how the creator wants it to be experienced.  This is the opportunity of digital platforms … an opportunity to bend the platform to adapt and augment the content.

Bjork, Fry, Rowling and Co.’s efforts also pick up on two key themes of current digital thinking.  Customisation and personalisation come as standard now – from designing unique trainers to Google+’s crafty ability to personalise search results based on what your social graph has interacted with.  There is increasingly no such thing as a one-size-fits-all solution – why should content be any different?

The second theme that content-experiences capitalise on is gamification – Pottermore will challenge you to pit your creativity with the world, Investorville can compare your simulated investment performance in the context of an actual game.  Whether you’re competing with yourself (how will I read MyFry today?) or your social network, building experiences around your content gives it instant socialisation; your content is inherently more sharable than the content alone would otherwise be.

More than anything though, packaging up content in ways that augment and amplify that content gives artists and brands alike a better chance at capturing some of the scarcest commodity on the planet – human attention.  If there is one direction of travel for digital, if not all, media it is one of a journey from scarcity to ubiquity…

The limited platforms of even a decade ago have given way to the limitless of platforms today.  There exists, to all intents and purposes, an infinite amount of content.  Artists, brands, governments, charities and media owners no longer have our attention by default…  our attention is fragmented across tweets and updates and downloads and wall posts and videos and even the occasional advertisement.  As 2016 – PHD’s latest publication observes – we’re all media owners now … the internet is populated not by 1.2 billion consumers, but by 1.2 billion content creators.  The quantity of content that exists is about to go off of the scale.

Bjork and Fry aren’t investing in innovative packaging for their content for its own sake – they’re investing in human attention.  They’re investing in innovations that will encourage us to stay with their content for longer and visit more often – and encourage others to do likewise.

The opportunity for brands is the same – innovating in digital media platforms to augment, amplify and socialise content.  Asking yourself what content you are creating is no longer enough … media has never more been part of the message.
 

In a Sydney Writers Festival conversation entitled ‘Who’s Afraid of Wikileaks?’ the panel were asked whether Wikileaks was a political or a media organisation.  They were universally agreed that Wikileaks is a media organisation...  that it exists to aggregate, organise and make available information for distribution.
It occurred to me that the idea of becoming ‘a media organisation’ wasn't limited to Wikileaks.  Its model – of aggregating useful information and then distributing it – is essentially an owned and then earned media combo.  Any organisation could adopt it, and many are.

It was a story echoed countless times across these last few weeks.  Anna Bay, Claire Evans and James Boyce described how their company DogMoneyWorld is creating a game called Crime Plays “an immersive experience that puts a crime world in the palm of your hands – The Amazing race meets Mafia Wars”.  Simon Moss, the founder of ImageBrief, explained how his photo ecommerce platform catered for the more specific briefs of creative agencies and people with professional image requirements.
Matt Stinchcomb, Etsy’s European Director, described how Etsy has never ‘bought’ media.  Rather, Etsy is an owned media platform on and across which nine million members and 8.5m products earn media; through transactions and trades, amongst conversations and discussions.  Stinchcomb was adamant that “Etsy is only its community.  That’s all it is.  If everyone decided to sell plush lumberjack dolls that’s what Etsy would become.  It’s symbiotic with its community”.

The theme of community was inevitably prevalent in any discussion around brand communications predicated largely on owned and earned media; it’s after all what converts owned media into earned media.  Stinchcomb observed that “commerce used to be about exchanging goods but it was also about connecting with people.  We are returning to a world that is connecting with people again … when you think of your community as your partner – it changes how you do business”.

The idea of community was tackled with gusto at a Creative Sydney session entitled ‘Group Think’ by Matt Kuperholz, a Principal at Deliotte Analytics.  He declared that one of the few things we weren’t running out of was data, and that the next ten years belongs to the statisticians.  He clearly got the memo that data is the new black.
Kuperholz argued that the only way to understand earned media is through the mathematical analytics of it; that when you understand how the different individuals in an organisation or community are connected you understand how to tap into, and harness, the potential of that community.

Social capital – the value of a company beyond its tangibles – is the fuel that drives owned earned brands and businesses.  This isn’t hyperbole – over 400,000 people have paid for products by Tweeting for them; they have converted their social capital into a tangible product, and brands have benefitted in ways beyond the exchange of coin.
Brands and businesses building platforms for owned media upon which communities generate earned media and propel the brand and business forward – a recurring theme to which Fabien Riggall – founder of Secret Cinema and Future Shorts –added a further element.

Riggall observed that “audiences demand more than a passive cinema experience” and that it is “technology that allows people to come together”.  This point was reinforced at the recent closing night of the Sydney Film Festival; one of the many achievements of outgoing festival director Clare Stewart has been her effort to embrace earned media as a key driver for the event.

This paradigm of owned media, which aggregates communities, who generate earned media, which fuels experiences, has recently been embraced by Intel.  Brian Fravel, Intel’s Director of Marketing for Brand Strategy and Management and a 13 year veteran of the company, described how Intel’s very technology has fuelled a generation of media users who “don’t want to listen to our advertising”.  A move from the rational to the emotional has seen Intel embrace not only earned media to fuel conversations but also owned media through their Visual Life project and a partnership with Vice called The Creators Project.  Fravel noted that “if you provide content an audience want they acknowledge your brand for doing so … you don’t need to slap your brand into communications”.

This isn’t a few businesses and organisations dabbling around the edges of communications models predicated solely on the use of owned and earned media.  It isn’t a blip.  It isn’t a bump in the road we set out upon in the 1950’s as the broadcast interruption model took hold.  This is a movement; a movement of people, communities, brands and businesses.  And it is a movement of media investment.

Be under no illusion.  It is the end of the ad venture.

Chris Stephenson, June 2011