Report: Online Branding- Where Next?
- Added:
- Apr 28, 2006
Sponsored by:
Delegates Attending
Mike Peralta Advertising.com
Lucy Sinclair BBC
Casper Moller T-VIRAL
Teddie Cowell Neutralize
Carole Jordorson ValueClick
Martin Loat Propeller
Neil Beston Propeller
Ajay Teli Propeller
Ed Lloyd-Williams cScape
Neil Svensen Rufus Leonard
Mark Vadgamma Rufus Leonard
Sarah Sherry Virgin Music
Aristos Peters Digital Media
Craig Hill Digital Outlook
Richard Dance unique-digital
Mike Teasdale Harvest Digital
Mike Ritchie Vividas
Lori Faye Fischler Consultant
Nigel Sheldon Starcom
Natalie Luthra Price Advertising.com
Carla Cotterell Advertising.com
Gavin Stirrat Advertising.com
Dr Jay Advertising.com
Mike Peralta, managing director of Advertising.com, kicked of the debate with a brief presentation. Despite glowing IAB reports showing burgeoning revenues online in recent years, Peralta referred to Nielsen//Netratings research that indicated the top 20 advertisers in the UK are spending a meagre 1.75% of their total ad budgets online. (see PowerPoint attachment below)
So what (if anything) is going wrong? Do advertisers need to be shown more evidence that online branding works, or is the Internet really not as effective a branding tool as those in the digital sector would like to believe?
To convince clients to go online, Casper Moller argued that it is possible to apply qualitative methods to branding campaigns through consumer surveys and feedback, but this is best suited to loyalty-based formats, such as games and communities.
However, Craig Hill said the problem remains with education, as even a strong case study will not convince some clients to take the plunge online.
Richard Dance pointed out that common methodology behind analysing campaign data is predisposed to come out with favourable results that fail to identify flaws. He argued this can be resolved with “sensible analytics methods” such as building offline behaviour measurements into campaign, such as in-store surveys questioning online buying habits.
Sarah Sherry said that traditional marketers are so used to buying press ads, and are actually “scared of seeing the conversion rates” offered by online media, suggesting the channel can actually be seen as too accountable for branding campaigns.
Martin Loat said branding is not about direct conversion, while Gavin Stirrat agreed, saying clients are too used to measuring performance online rather than focusing on branding.
Mike Ritchie countered by saying that as the TV experience is becoming replicated in new media channels, the nuances of traditional TV ads are also being adopted online.
Moller agreed that the likes of viral marketing can emulate the same branding techniques as that on TV, but he was “worried people are saying ‘have you seen this great message?’ rather than ‘have you seen this great product?’.”
Dance was equally cautious, saying the reason the likes of Unilver and P&G have neglected online is because they “know so well how to make money out of traditional media”. The challenge for digital agencies, he said, was to focus on “hard serious marketing”.
Ritchie countered, saying that as IPTV rises, the FMCG companies will migrate their TV ad spend onto the multitude of health and lifestyle channels being delivered over broadband lines. Dance acknowledged this, but thought such a scenario was still 10 to15 years away, and in the meantime agencies should concentrate on “talking the right language” to clients.
Mike Teasedale suggested that “maybe online isn’t as good as it thinks it is”, while Loat pointed out a generation gap between the top 20 advertisers, with older companies being the most reluctant to shift their adspend online, while younger firms, such as O2 and Sky were more likely to embrace new media.
Dance argued that following the dotcom crash, online marketing “went down the ROI route… into the defensive position where all we can do is numbers”. This has lead to agencies “shoving their new recruits into search” and away from the display and creative sectors, meaning the industry is ‘losing a tranche of people’ to the search marketing sector.
Referring to a quote from a senior IBM director wanting “technology to disappear”, Ed Lloyd-Williams spoke of how clients can be put off by too much jargon, and are only interested in ensuring their campaign works the way they want.
Mike Peralta then steered the debate onto how agencies can work to get a bigger piece of the budget. Hill said a problem was that there are not enough case studies that are based on user experience, which would let agencies show clients how online messages affect brand perception.
Moller was more positive, pointing out that Lego had migrated all its online marketing budget online in the US, centered around a ‘Lego-Club’ online community, because they “couldn’t compete with the big toy manufacturers on TV.”
Loat asked if some products and services lend themselves to online branding better than others, using Kellog's as an example of a bad fit for the Web.
Dance agreed, saying the more people access the Internet at home rather than at work, and the medium is not currently as captivating as others.
Brendan Condon, CFO for Advertising.com, likened the current online market to that of the US cable market ten years ago, when there was a “migration of advertising dollars” to the cable market as it became more popular.
Peralta asked the group if there will ever be an inflection point in terms of branding from TV to online, and what that would mean for the industry.
Ritchie answered citing the problems faced with PVR technology, giving consumers the chance to skip ad breaks. He went on to argue that the future of online was in streaming technology, which could replicate TV and cinema quality vision. He said a lot of the top advertisers are going to “wake up one day and realise the TV has become the Internet”, adding that they will realise they can now reach “thousands of customers for pennies rather than for pounds”.
Teasdale asked if in that case maybe the Internet industry should be “complacent and wait for TV to fall off a cliff”, while Carole Jordorson countered saying there will a point when the Internet is “truly mass market” and it is the Industry’s responsibility to help speed up that process.
Lucy Sinclair offered a broadcaster’s point of view, saying that TV will be the “one that wins”. She argued that as “TV shifts onto the Internet, it will be the Internet that becomes television, not the other way round”.
With the group asking how to get a greater share of the marketing budget from major FMCG brands, Teasdale asked the group what they would do if “Unilever came in the room now and offered you a two hundred million pound online marketing budget… how would you spend it? I think we might freak out a bit”.
Hill answered by saying that as an owner of a business he is actually “terrified of the tipping point” where digital overtakes traditional media, as they can’t scale up that that quickly. He said the industry shot itself in the foot once already” trying to grow too quickly.
Dance said he would rather tell Unilever to lower their online budget the make the campaign more manageable and effective.
Nigel Sheldon said Starcom already handled some of P&G’s online budget, and argued that they are spending more on digital media than was being suggested.
Sheldon agreed that there were many key drivers that will push online to the next level, but saw a bigger generation gap occurring in the future between the younger set that has grown up with the Internet and the older generation that grew up with TV.
Craig Hill took on this view and said the industry will need to be prepared for this dual market and wondered if marketers will need to divide in two to cater for both markets.
Sinclair said a key factor holding back online as a branding tool is that the Internet is used as more of a functional tool than an entertainment tool, unlike TV, where viewers are in a “more favourable mood”.
However, Moller said that there are examples of big brands using “advertainment” campaigns, such as Coca-Cola and Fanta, who launch platforms that “are not trying to sell you anything” but are just looking to “engage the consumer with the brands” via games and community sites.
Condon then asked if the Internet can ever take advantage of different ‘day parts’ in the way TV can, offering brands the opportunity to sponsor a live event online, for example. He said the 24/7 on-demand naturte of the Internet did not lendi itself to this kind of branding as well as on TV.
Stirrat pointed out online events such as Big Brother can work effectively online for brands, while Dance agreed with Condon to an extent, saying digital media is all about letting people consume media in their own time, rather than someone else’s.
Moller, used football as an example of online media mimicking TV, saying watching sport on TV is a more enjoyable experience in the living room than it is in the office.
However, Ritchie countered using Carslberg’s streamed live football campaign as an example. He said the service was ad-funded, meaning it was free to watch, and gave Carlsberg a prime platform to advertise to a large captive audience.
Moller then took this forward, saying brands could own the content outright rather than just seeking space on others content. Dance said this was a great example of online branding, but not all firms can afford to do this.
Stirrat pointed out that much of the debate was geared towards rich media, but most of the Internet is still all about information and next. He suggested that this was an admission that the Internet, in its pure form, was not an ideal tool for branding, and is still better suited for numbers based campaigns with strict ROI objectives.
Moller agreed, concluding that the Internet will get lifts from other media as they converge, eventually offering a platform for TV-style branding campaigns in the future.