Humpty Dumpty Marketers

This post does not mark the end of my annual hiatus which will run into August.

I’ve been mulling over a future post that a business school professor-friend of mind asked me to write about what I see as the future for community destination marketing organizations, my former profession.

It will be an opportunity for me to practice what I preach about looking back to see forward for strategic insight.

It pains me to admit that many in my former profession don’t seem to be the brightest bulbs in some respects or there would be far more than 200+ of these organizations that are accredited.

Maybe I resemble that remark in some respects (smile.)

But even accreditation, which is essentially a diagnostic to identify areas for continuing improvement, isn’t a guarantee against a proclivity common among far too many DMO execs.

This is the regressive tendency of a few tenacious but well-meaning and otherwise reasonable execs to waste everyone’s time trying to put the proverbial “Humpty Dumpty back together again.”

What these folks fail to grasp is that forms of organizational structure and marketing strategy along with various tactics become obsolete because essentially the “ecosystem” of tourism has rapidly and perpetually evolved.

They could easily spot these paradigm shifts in SWOTS analysis if they were not in such a hurry to check that process of the list rather than mine it for insight.

Brian Solis, a strategic analyst, futurist and principal for Altimeter Group, now a Prophet Company, has a great line.  “The future of marketing has little to do with marketing.” He is referring to traditional marketing and especially advertising.

Some businesses and organizations in the various industries that make up travel and tourism are guilty of hypocritically keeping roadside billboards on life support.

I call their use “desecration marketing” because they underwrite no content other than the advertiser “yelling at you” while blighting the communities and scenic assets that motivate travel.

All of this to reach 2/10th of 1 percent of people who are motivated to buy something in a given year based on that form of message.

If you have read some earlier posts, you will see the irony in the message on the image captured of a billboard in this essay.  It was posted on one of the 80 or so remaining in Durham, North Carolina where I live and where billboards were banned in the early-1980s.

For those new to this blog, between smart devices and in-vehicle navigation systems, eight times the percentage of Americans who aren’t turned off by billboards in general have already shifted to navigation systems for both directions and to find points of interest such as gas stations.

The advertiser on that billboard shown above is proud of its efforts at conservation and environmental restoration but that apparently doesn’t extend to scenic preservation including eliminating sense-of-place pollution such as sign blight.

It is not the first company where company marketers apparently feel exempt from social responsibility policies when it comes to where they advertise or oblivious to metrics such as turn-off ratios.

Traditional advertising overall (in newspapers and on radio, television and billboards) began an overall decline in effectiveness three decades ago that by 2010 had reached a negative return on investment.

When adjusted for inflation, ad revenues for newspapers today have fallen below where they were in 1950.  Even when digital and other revenues are included they are essentially where they were 65 years ago.

Other traditional advertising mediums are or will be following suit.  Analysts now project that newspapers are poised to replace local television when it comes to local video content within the next ten years.

The rapid shift to online advertising instead has created what experts such as Mathew Ingram, a senior writer for Fortune, described as an “arms race” this month between advertisers who still don’t get it and viewers determined to block out ad content.

Marketers engaged in this arms race have failed to notice that even online, where ad blocking has grown 7 times just over the past five years, that the ecosystem for advertising period has changed.

If you want to reach consumers, it no longer works to yell at them which is essentially what advertising is. There is no use trying to put that obsolete “Humpty Dumpty” back together again.

It isn’t the nature of advertising that changed; it is the overall consumer ecosystem.  It is long overdue for communicators to also evolve.

But many marketers, including more than a few in my former profession of community destination marketing simply won’t.  That’s apparent by their steadfast refusal to evolve or perhaps due to stakeholders who won’t let them or peers who keep pulling them into futile schemes to reassemble old “Humpty.”

Billboards are an example.  The first one was erected in the United States in the 1830s.  They had become a pariah to consumers by the 1880s when billboard owners turned to out-of-step lawmakers to keep them on life support.

Oblivious or lacking a strategic bone in their body, many advertisers who are obviously also very bad at math still insist on using them today, even though eight consumers are turned off by their use for every one who isn’t.

Like I said, not the sharpest knives in the drawer.  But hey, neither was “Humpty Dumpty.”

Puzzling Folly Is North Carolina’s Tragedy

It isn’t clear why a powerful North Carolina senator from Onslow County, has been relentlessly working over the past five years on behalf of the billboard lobby, but it is extremely puzzling.

Whatever the motive, this seemingly good and otherwise reasonable official, has been a highly effective at battering North Carolina’s sense of place and overall appeal, which is so essential to tourism and other forms of economic development.

Maybe it is, in part, payback for copious campaign contributions?  Makes sense.  Because he owns auto dealerships which have in the past used billboards?  Possibly.

Because billboards are so effective?  Very doubtful, unless he has been living under a rock.  Here’s why.

The automobile sector is one of the few where traditional advertising was still found to be clinging to effectiveness when a 2010 longitudinal study found that this element of marketing had fallen to a negative return on investment, following a three-decade free fall.

By 2012, two years into the senator’s push on their behalf, roadside billboards had clearly fallen out of favor with consumers, when only 2/10ths of one percent found them useful to purchase something.

That percentage climbs to only 4.6% when you take into account other types of less destructive outdoor ads such buses and kiosks but it is clear that huge roadside billboards, the focus of the senator’s zeal, are the least effective of the least, barely clinging to life support.

By 2013, when the senator set his sights on overriding popular billboard bans in some towns and cities, his own automotive industry was rapidly shifting its advertising elsewhere, online in fact.

It was clear by then that even around town, nearly two-thirds of consumers had shifted to smartphones to find products from roadside and according to analysts the trend was rapidly growing.

While traveling, this percentage is now over 75%, meaning Cracker Barrel could be saving a lot money instead of paying for the 1,600 billboards it claims to have rented as of 2014, making it one of the top source of blight among restaurants.

The chain is traveler-driven with pass-through visitors representing 40% of its business.  But it obviously hasn’t updated its marketing plan for a few years. On the road, 3-in-4 are now using smartphones instead, resulting in a conversion rate of 85% for restaurants.

A 2012 Nielsen study found that mobile advertising and online searches reached 62% of automotive consumers before they had made a decision as well as 38% of those who knew exactly what they were looking for.

More significantly, 49% made an automotive purchase related to using their mobile device.  By year end, even dealerships such as the senator’s had shifted as much as 40% of traditional advertising to digital.

Let’s see:  use billboards and influence 2/10ths of one percent or mobile advertising and influence 49%?

No brainer.  So why are a few legislators so bent on forcing billboards down the throats of Tar Heels and their visitors while levying a hidden tax from the destruction of thousands of acres of public roadside forests?

In 2013, auto manufacturers and dealers spent more on online advertising than traditional advertising and at a rate of nearly three times the growth of overall advertising.

During 2015, they will spend $7.30 billion online.  That amount will increase to $12 billion by 2019, more than double the amount of annual spending there the year the senator’s onslaught began, at tax payer expense, to keep billboards on life-support.

The automotive industry’s online spending is 60% on direct response such as email and 40% brand advertising.  Nearly half is mobile related and half PC related.

It will be the third highest industry in mobile ad spending this year, at $3.43 billion, several positions above even the early adopting travel sector.

Online ads are considered viewable when half of the pixels are in view for one second, according to experts, only 40% as long as it takes to decipher a message on a billboard and they do not contribute to blight and deforestation.

It isn’t a coincidence that the time it takes to decipher a billboard is   the span of inattention found just prior to 80% of crashes and 65% of near-crashes.

The senator’s most recent push on behalf of billboards is to permit them to clear the view of trees along exit ramps each of which average 1,200 crashes each per year, which is already influenced by visual inattention as a contributing factor for 93% of rear-end crashes.

The most convincing evidence of the complicity of billboards on accidents came from a study of locations before and after they were removed.

Flippantly, many lawmakers dismiss the senator’s illogical obsession by testifying, in jest, that billboards will soon be entirely irrelevant, abandoned by their out-of-state owners.

What the heck, it will only take 50 to 60 years for North Carolina’s roadsides to recover.

Culture, Mindset, Analytics and Nonprofits

A recent article heralded the halo effect of advertising, but the almost impossible task of measuring the effectiveness of traditional advertising means any probable halo effect is more attributable to marketing.

This is because marketing is a blend of various communication activities, only one of which is advertising, and less and less of that is traditional advertising which experts now find has an overall negative return on investment.

It is this blend, when customized to each organization, that creates a synergy transcendent of any of its elements.

Unfortunately, a survey released this month shows that less than a third of marketers (32%) put data and metrics “at the heart of their strategic decision-making.

What is disturbing about that finding is that data-driven marketing is nothing new.  By the early 1980s, it had found its way to the core of a small nonprofit community marketing organization I led.

Granted, I was an “early adopter,” as I still was in 1989 with similar startup with which I was involved.

But seeing how quickly this approach enabled early adopters to leapfrog more established competitors, one would expect it to be more mainstream by now.

Studies pinpoint that the reason so many marketers remain mired so far in the past is because of they lack a strategic mindset even though recruiters for top marketing positions now find that attribute, along with analytic skills, more important for marketing leadership than creativity.

A study conducted in 2012, long after I retired from four decades in the field of community marketing, showed that the nonprofit sector in the U.S. had grown 3.5 times the rate of the for-profit sector.

Fast Company magazine surveyed their ten most innovative companies in not-for-profit recently to ascertain what talents and skills will be in most demand in this sector over the next five years.

Top are data-savvy skills.  Next come design skills.

Those, along with technology were at the core of my last non-profit startup 26 years ago.  I don’t say that to gloat but out of puzzlement. We couldn’t have been three decades ahead.  Really!

If I stumbled into those competitive advantages so long ago, how is it that so many of my former peers across the country apparently still don’t get it or is it?  Or maybe its that their governing boards don’t get it?

Survey results show that 96% of marketers today know that data is important or very important including 9-out-of-10 in senior management but as the authors point out, that is very different than knowing how to collect, manage, analyze and utilize it.

Telling is that fewer than half of marketing organizations give more than half of their own employees access to their data.

This is why so many go to the trouble of contracting analysis to show how effective their marketing strategies are, known as the “turn-on” ratio.

However, they nearly always fail to measure the equally significant “turn-off” ratio such as when their ads are merely a form of yelling or placed in the wrong context such as on billboards where they are associated with desecration.

Even Super Bowl ads have a 5-to-1 turn-off to turn-on ratio, further illustrating that less than a third of marketers have data and analytics at the heart of strategic decisions.

Marketers will be in high demand if they have a strategic mindset, understand analytics and design and recognize that marketing is not only about “turning-on” consumers but minimizing “turn-off.”

The president of the Rockefeller Foundation is quoted as saying that nonprofits in general are projected to continue to hire more talent than the for-profit sector over at least the next five years.

Silverpop, an IBM company, has just published an ebook entitled, The New CMO Guide – A Handbook for Marketing Leaders.  This is also an example of content marketing, a form of advertising that has replaced traditional advertising.

The authors note research showing that 82% of marketers feel unprepared to deal with the data explosion.  In part, this is why the average tenure for chief marketing officers is now only 48 months.

Even more so, this may also explain why, according to Spencer Stuart, this tenure was less than 24 months just a decade ago when the importance of data belatedly began to dawn on marketers.

But especially in the field of community marketing, hiring a chief executive with a strategic mindset who understands analytics isn’t enough.

It is an organization’s culture that makes all the difference and sets the tone for “innovation, growth, market leadership, ethical behavior and customer satisfaction,” according to a new white paper published by Spencer Stuart, also a form of content marketing.

It was management guru Peter Drucker who originally discussed that “Culture eats strategy for breakfast,” later modified by others as “Culture eats strategy for lunch.”

But Drucker wasn’t referring to a document as much as the strategic mindset.

Culture in the organizational sense is what Dr. Kelly Page of NativeHQ refers to as “an iterative process over time that we enact, guided by vision and values forged through conversation and collaboration…our individual and collective voice over time.”

Shawn Parr, head of Bulldog Drummond, encourages us to view an organization’s culture as a “nurturing habitat for success.”

He continues that “Cultural cannot be manufactured;  It has to be genuinely nurtured by everyone from the CEO down.  Ignoring the health of your culture is like letting aquarium water get dirty.

A shared culture creates critical alignment.  And that alignment must also include each and every member of an organization’s governing board.

Why Advertising Remains Effective In One Area

Published in 2008, a study of the effectiveness of traditional advertising (TV, radio, and print) found it began to lose steam three decades earlier, long before the Internet became viable for the general public.

Using updated research tools, the study reanalyzed scores of studies going back well into the 1960s and found that traditional advertising began to lose steam long before the Internet provided an excuse.

Today, even durable goods such as automobiles and appliances, which were lonely exceptions in the 2008 study, have now shifted more than half of any advertising to digital forms.

But despite the fact that there is now a negative return from traditional advertising, there is one area where it excels: political attack ads.

Having been recognized myself in the early 1980s for advertising innovation and excellence, I can see a few reasons why:

One is that political races are winner-take-all in this country so a candidate only has to influence one or two percent more voters than his or her opponent, as Thom Tillis did over Kay Hagen in the North Carolina race for U.S. Senate.

After $79 million was spent on attack ads by independent groups of anonymous donors on this one race alone, it isn’t likely the narrow outcome in the state where I live was influenced much by the $30+ million spent by the candidates.

Two: no other type of advertising would be considered successful because it alienated 2% fewer people than it influenced.  Especially since, persuasion of other products and services must influence public opinion every day, not just every four to six years.

Three: people are more responsive to negative information than positive.  This is why frustrated voters often reward the perpetrators of dysfunction while laying blame on those who tried to do something positive.

The question is not how I made it through this election season untainted by this influence but how I came to see three campaign spots, one of them three times.

A total of $16.25 was spent per vote, obviously much higher if taking into account only those who didn’t or couldn’t escape the onslaught.

It is no secret that I have long been one of the now 7 million Americans who stream all video content including television.

During the campaign my radio consumption was only while driving, making coffee or feeding the pups, and it was restricted to satellite radio and NPR.

What may be more telling is how those three ads made it through.

One was a billboard paid for a group on behalf of Kay Hagen, not an attack ad, but the medium a turn off because it is obviously incongruent with her values.

The other two, including one I was forced to wait through two more times was on behalf of Thom Tillis with whom I have worked on state legislation, were only to attack Hagen.

I use the word “forced” because whoever paid for these attack ads on You Tube, where I was gleaning content for two personal history essays, apparently paid Google a little extra to turn off the ability to skip these particular ads after a few seconds.

Sensitive otherwise to annoying users, Google otherwise enables the “skip ad” feature.  It is also because advertisers there are not charged for impressions that are skipped.

But the choice of six seconds before skipping an ad may be because Google analysts are familiar with cognitive research finding that 6.5 seconds is all the attention paid to ads, even on-screens such as television.

If the message isn’t clear in that window of time, advertisers are wasting their money.

In fact, studies show that Americans now pay attention to anything an average of just 8 seconds, down by a third since 2000.  That may seem like an eternity if riding a bull or bronc but it is less than the attention span of a gold fish.

And the average “memory span” is half as long.

It gets worse.  Attention span breaks down into five types and only “continuous attention” makes it to 8 seconds.

Tempted to dismiss averages?  Run it through an 80/20 computation and it will be clear that while a tiny fraction will watch an ad over and over, the vast majority of those the ad is intended to read never register it at all.

Traditional adverting is further complicated now not only because consumers, bombarded with an average of 10,000 a day have learned to tune them out, but because the window of attention when given is incredibly brief.

Political attack ads work because the advertisers really don’t have to worry about turning off half of those who watch them while reinforcing previously held misinformation in the other half.

All they need to do in North Carolina is reach enough Independent (unaffiliated voters) in certain counties to generate an extremely narrow win and they pray the vast numbers it annoyed have short memories.

Sound like a good strategy for marketing any other product?  Nope, it would be suicide by commercial.

Skip alert – readers who don’t know me will not grasp the irony in what I write next.

Nearly all of my adult life, I’ve been encouraged to run for office, something I’ve never been inclined to do.  This is because I have fared well in surveys of residents about job performance.

So to cut off any possibility of retreat on that stance, as a fun exercise, I have noted below how a hypothetical opponents regardless of leanings could trash me with attack ads:

• he’s an independent, therefore wishy-washy and indecisive.
• he’s too chummy with developers and business types
• he’s too chummy with neighborhood leaders and other guardians of sense of place
• he impatient with meetings and is too introverted
• he is too logical, cold and relies too much on data
• he’s been married too many times
• he doesn’t attend church, at least in buildings
• he’s uncompromising ( won’t go along just to get along)
• he rides a Harley so he must have gang ties
• he’s one of those environmentalists, a tree-hugger
• he drives a Jeep so he obviously doesn’t care about the planet
• he has an English Bulldog so he must not like kitties
• he’s too Durham oriented and parochial
• he believes in social justice so must be lenient on criminals and welfare cheats
• he doesn’t let special interests bend his ear
• he’s not a team player
• he’s a northerner (or a westerner) when it comes to old Dixie
• he volunteers for tax increases
• he’s against tax breaks and loopholes
• he’s too intense

Hell, I probably wouldn’t vote for me either.   But my reasons for not being interested in elected office have nothing to do with preserving my reputation.

There are just good people far better suited.

Creating Contentment

While standing behind a lady waiting to check in at the doctors office, I kidded her about the time it was taking.

“I hate Durham,” she volunteered.  I moved here a year ago and I came here to change my address.  I’m moving.

Without telling her I had once been in the business of helping visitors, including more than 85% of newcomers who come here as visitors first, I apologized that she had ended up making a decision that was not best for her.

I finished our exchange by mentioning that her sentiment was shared by 1-in-50 Durham residents compared to the nearly 20-to-1 Durham residents who have just the opposite impression of living here.

She was visibly stunned as we all are when we find ourselves feeling so strongly about something that we assume is a broadly held notion.  It isn’t just the Tea Party political movement that labors so.

Even when less strongly held negative feelings are included, more than 9-in-10 Durham residents are pleased with it as a place to live.  Ideally though, we would have helped the 5% who aren’t make a better decision for themselves.

Advertising is just one element of community marketing but as a form of “yelling” it is the most blunt, and as such, fundamentally differs from marketing overall in a critical way.

Advertising was invented as a means to create discontent.  Marketing is a way to help people make decisions that are best for themselves, even when it does not go your way as a marketer.  Especially when it doesn’t go your way.

That’s why marketing is supposed to be a conversation as opposed to advertising, which as someone once said is like “that guy” at a party who goes on and on about himself not letting anyone else get a word in edgewise.

Come to think of it, maybe that’s why people who are that way in conversation tend to think of marketing only in terms of big ad campaigns which fail to influence or create interest and result in a negative return on investment.

Adverting is dead by its own hand.  Inundated on average now by 10,000 ads a day, consumers have finally just tuned out.

The first ad in America was run in 1704.  Dr. Freddie Parker at NCCU here in Durham has conducted studies of ads used to recapture slave runaways in North Carolina between 1775 and 1840.

Advertising became institutionalized in the decades after the Civil War.  Near the turn of the century modern advertising was shaped to create discontent in order to push the use of products such as soap, deodorant and mouth wash.

By the early 1900s, psychologists were being hired by ad agencies to create messages of discontent.

In their new book to be released next month entitled, Smart Money Smart Kids, talk-radio financial guru Dave Ramsey and his daughter Rachel Cruze write about how hard it is to teach contentment and to teach kids how to see through advertising designed to create discontent.

By 1984, adverting began to decline in effectiveness until now, it is effectively worthless if not a negative.

Unfortunately, many marketers have difficulty with the notion of conversations with consumers or the idea that the objective is to help them find contentment.

Scientific studies show that at the heart of meditation’s effectiveness is contentment in the here and now.  Even in my former field of community marketing to generate visitor-centric economic and cultural development, studies have shown that the biggest boost from a vacation is planning it.

Only very relaxing vacations such as those I take with my grandsons and daughter to a lake in the northern Rockies each summer boost happiness after the return.  Travel overall these days is more likely to result in anxiety.

It may vary for individuals, but proof still that marketing should be most about helping people.

Doomed by A Craving For Long Narratives

“One of the most dramatic and consequential cultural and business developments of our time…”

That’s how columnist Michael Wolff, the former editor of the trade publication, Adweek, described the significance earlier this month of a Disney decision to formally permit ad-skipping technology.

By revenue, Disney is the largest media company in the world, owning more than a dozen cable networks and the ABC network, which owns the TV station in Durham, North Carolina where I live.

Disney is the first of the traditional television networks to make this move.  For some time, television overall has been weaning off advertising and toward revenues from licensing fees, just as savvy marketers have been moving away from advertising as a means of reaching consumers.

A similar calculation was made by the new owners of Newsweek magazine when they decided to resurrect the print version based on a subscription model, something many other publications are doing with both digital and print versions.

The son of a former advertising agency executive at the dawn of the Mad Men era, Wolff is forgiven an anachronism when he proclaims that “brands must advertise.”

Of course, they don’t, not any longer.

He may be harkening back to the day of “bang the drum” marketing when advertising, which is just one element, was confused with marketing overall.  There are now many more fruitful and authentic ways than advertising (which is a form of yelling) to reach consumers.

“Great works deserve a great spotlight” is a rationale for marketing that I first heard used by Chip Bell, author of The 9 1/2 Principles of Innovative Service.

But marketing for all but the laziest, zombie-like marketers, long ago ceased to be about reaching the most eyeballs but reaching the right eyeballs with genuine, credible and valuable content.

Advertising’s decline began in the mid-1980s.  Within a decade it had been surpassed in effectiveness by other elements of marketing including earned media and content marketing.

Today, advertising is measured as having a negative return on investment.

Retail consumers rate it last in influence with a negative-to-positive ratio of 7-to-1.  Studies also show that 60% of consumer and business-to-business purchasing decisions are made before ever making contact with a human being or seeing an ad.

Even ads place during the Super Bowl have a 5-to-1 turn off ratio compared to the 8.4% of viewers who buy the products or services advertised.  The days of “yelling” are over.

Online advertising, too, is struggling to avoid what happened long ago to outdoor billboards.  They continue in obsolescence to blight communities and roadsides by seeking favors from government even though research shows they are now rarely viewed and used by only one-fifth of one percent of consumers to inform actually buying something.

Experts estimate that nearly 2 trillion online display ads were paid for by advertisers in 2012 but not seen, not unlike the nation’s more than one million billboards have become invisible.

The problem with advertising is not just that ads are notoriously difficult to measure, but that inundated now by nearly 10,000 a day, Americans have just tuned out.

As one marketer recently said to describe advertising:

“Some brands are like that guy at the party who has had too much to drink and won’t shut up and never lets anyone get a word in edgewise and just goes on and on.”

Disney hasn’t spelled the end of advertising.  The advertising industry’s greed and “more, more, more” mentality has, a lesson hopefully learned as mobile devices take everything hyper-local and makes relevance supreme.

Wolff also points to studies showing that viewing advertising is a learned and habituated activity.  And the rate at which Americans are “unlearning” this habit is growing far more rapidly than even the most ambitious analysts have projected.

In an ironic way, the television audience is rapidly bifurcating.

First aired by MTV, which in 1991 was looking for something to supplant music videos, which had lost their hypnotic appeal, the now ubiquitous reality television shows appeal to 75% of Americans who are poor but to only 5% of those who are very well off.

More than half of Americans now record live video content so they can skip ads through a number of technologies, the fastest growing of which is streaming television services where for a very small monthly fee, viewers can watch what they want, when they want.

Ad-free streaming television subscriptions, including nearly 50 million now on Netflix alone, (click here for an article in The Atlantic on how Netflix reverse engineered Hollywood) are now running neck and neck with those subscribing to premium cable channels.  One consumer behavior driving the shift is binge watching.

More than 7-in-10 streaming subscribers describe binge watching as watching 2-6 episodes of the same TV show in one sitting, something done by more than 6-in-10 who stream TV at least once a week.

Binge watching emerged about five years ago.  A friend and I happened to try it by viewing all 121 episodes of Lost, an acclaimed ABC televisions series neither of us had watched during its initial 5 season run, over a period of a few months.

Netflix recently sent Dr. Grant McCracken, an MIT cultural anthropologist, into the homes of TV streamers to learn why they binge watch.

The source of the quote above about “that guy at the party,” he describes his interest as “where culture meets commerce and economics.”

It turns out, according to his analysis, that even in the age of micro-blogging 140 character tweets, human beings crave long narratives.  Binge watching provides that.

I certainly agree that watching a season of a good series, even over the course of a week or two is enjoyable and far more preferable to watching advertising-laden versions.

Penn State neuroscientists Dr. Jordan Gaines Lewis notes on her blog that the term “empathy” was coined in 1909 by British psychologist Dr. Edward B. Titchener.  “Cognitive empathy,” she notes, “examines how humans can adopt others’ psychological perspectives, including those of fictional characters.”

According to McCracken, who blogs at Cultureby.com, binge watchers are a new breed, consumers Netflix calls the “new normal.”

Free to choose content and the time when they will watch it means they become more engrossed in narratives, usually with at least one other person, rather than zoning out and mindlessly flipping from channel to channel.

Television is no longer linear, a lot less irritating and finally weaning itself from advertising.  Indeed, “One of the most dramatic and consequential cultural and business developments of our time.”

Now about reclaiming those roadsides!

Millennials Are Transforming Marketing Itself

I was feeling pretty impressed with myself after reading a new report detailing the digital platform habits of various age cohorts.  I am closer to Millennials (ages 18-34) than I am to Baby Boomers, my age group.

Then I looked at a map of the recording artists who are most popular in each state and realized that I was only familiar with a dozen or so.

From the song at this link, an R&B throwback, I can see why Miguel is most popular in North Carolina where I live.  I can also see why Tegan and Sara are popular in my native Idaho, but I obviously need to get out from behind this blog more.

It is among the 77 million Millennials, which, with 24% of population are already generating $1.3 trillion in direct spending each year, that you can most clearly see the death knell for advertising, an element of marketing.

In fact, according to the formidable Boston Consulting Group, Millennials are transforming marketing as much as they are altering consumer behavior.

They have expectations of reciprocity.  They are repulsed by desecration marketing such as roadside billboards as well as thinly veiled retro Jim Crow laws promoted in some states against Gays, people of color and young people.

According to Nielsen, nearly 4-in-10 Millennials are not US-born.  The same proportion have become bilingual.  Only half as many are married as Baby Boomers were by that point, but nearly twice that percentage of Millennial women have children.

Millennials now make up 1-in-5 same-sex couples and a greater percentage have graduated from college than other generations.

A Pew report shows that a greater share Millennials live both in suburbs and central cities than either Boomers or the Silent generation did at that point.

This may also mean the suburbs aren’t dead and that rejuvenated downtowns across the country may eventually see another bust cycle as this generation ages.

A new report by comScore shows just how much more likely Millennials are to skips ads altogether on television including 90% while watching recorded TV.  Their shift to online news is driving a dramatic decline in audience for local television news, where ad revenues have typically made up 48% station revenue.

They lean heavily toward digital channels and marketers simply have to take another approach to reach this generation.

Nielson reports that those still advertising on television are rapidly shifting from 30-second spots to 15-second spots.  Partially, the thinking is that because Millennials have a strong preference for video that the challenge is mastering ads as short-form video.

Even that isn’t likely to be enough but they could go a lot shorter.  Research shows that even for those who watch television ads, the typical viewer pays attention for only 6.5 seconds.

The problem isn’t the length of the ads or how compelling they may or may not be.  The inherent problem with advertising is that even in story form, it is a form of yelling, the advertiser yelling about themselves.

Because this especially turns them off, Millennials prefer to seek information on other platforms but it is just with this generation that an overall shift is most apparent.

Businesses that rely on advertising in any form have so inundated the marketplace that the average person is bombarded with 10,000 messages a day.  People have just tuned out, thank you.

Worse, advertising has become so ubiquitous that not only do studies show it with a negative return on investment but that it also dulls our sense of empathy.

Millennials, in particular, have discovered many more effective ways to glean information including content marketing and old-fashioned earned media, otherwise known as news stories.

Of course, advertising is a huge industrial complex that knows only one behavior: more, more, more.  The reports I’ve cited in this blog are meant to be reassuring about the future of advertising but the sense of desperation is clear.

Even if things do come full circle as this paper suggests by showing us how the Internet could eventually make media physical again, it isn’t clear that the advertising industry can ever learn restraint.

More convincing are webinars and related downloads regarding the massive shift to content marketing, such as the one at this link by Adobe with six steps to building a content marketing strategy.  The speaker makes it clear “that it is no longer about more.”

Nearly 9-in-10 marketers have shifted to branded content for marketing to consumers, slightly more use it for business to business marketing and more than 7-in-10 think it is more effective than advertising.

Content marketing can involve as many as 16 different tactics with 12 being the average.  Content marketing isn’t new, but just referred to now by an overarching terminology.

The organizations I previously led were utilizing ten or more of these tactics throughout much of my now concluded, four-decade career in community marketing.

The prominence of content marketing began as early as 1984 as the effectiveness of advertising slipped into its long slow decline.  It accelerated as advertising fell to a negative return on investment overall a few years ago.

Unfortunately, many marketers were slow to make the shift, as noted in the white paper entitled, “Turbulent Times for the CMO.”  Content marketing, according to analyst Robert Rose, is no longer about acting like a media company but becoming a media company.

It is also about not yelling.  It’s not about more.  It’s about authenticity.

A Form Of Ignorance, I Suppose

A lead-in on NPR prior to the Super Bowl proclaimed that devotion to football just keeps growing.

Actually, public opinion polls show that the percentage of Americans who are football fans peaked eight years ago and has been slipping ever since. Yes, the numbers may have grown, but the percentages haven’t.

Even among the percentage watching the Super Bowl, which peaked two decades ago, only about 35% cite watching the game as a priority.

The average number of fans attending regular season games over the last two or more decades also peaked in 2007.  It’s a very popular sport but “devotion” has definitely not gotten stronger.

The news media may be far more fragmented today than it was in 1990 but that means it has become even more a victim of its own hyperbole.  I am a lifelong football fan, but I idealistically refuse to believe this has anything to do with selling advertising.

A form of ignorance, I suppose.

A nationwide poll of shoppers last October showed that the effectiveness of advertising in general has taken another hit.  Already a negative return on investment since the 1980s, only 4% of consumers rated it most important out of five different influences on the image of a brand.

Nearly 2-in-3 rated it fourth or fifth in importance and 1-in-3 as the least important.  By far, personal experience is the most important influence, 16 times more powerful than advertising.

Another survey last year by Harris found that irrelevant pop-up ads, the oldest form being roadside spam popping up on sticks in roadside forests and the newest of which now pop up on the Internet, are the most annoying to Americans.

More than 7-in-10 are just annoyed.  More significantly for advertisers, 9-in-10 of those who are annoyed take action against the advertiser or medium.  Advertising in general not only has a negative return on investment now but it involves significant reputational downside.

Advertising is plagued by several systemic drawbacks:

• It is you “yelling” about yourself so it lacks credibility
• Subjected to 10,000 ads or messages each day, audiences have tuned out
• The industry is powerless to eliminate obsolete mediums such as roadside billboards
• Advertisers fail to grasp turn-off ratios and not just for desecration mediums such as billboards
• In-house marketers seem detached from the sustainability goals of their organizations

This failure of self-control or self-governance exacts a heavy price on society.  Except for billboards, advertising is the model that has supported the creation of a vast amounts of news, sports and entertainment.

It is kept on life-support now by ignorance such as a community recently that spent its entire budget on roadside billboards as a perversion of the concept of wayfinding, enabled, I suspect, by someone crossing the line ethically.

Entrusted with safeguarding their community’s brand, destination marketing organizations that use this form of advertising are instead scarring first and last impressions.  This is the epitome of what has destroyed advertising.

It is a perfect example of the difference between being ignorant and being uninformed as blogged by Seth Godwin yesterday:

“Uninformed is a temporary condition, fixed more easily than ever.

Ignorant, on the other hand, is the dangerous situation where someone making a decision is uninformed and either doesn’t know or doesn’t care about his lack of knowledge…

‘Ignorant’ used to be a fairly vague epithet…Today, because it represents a choice, the intentional act of not knowing, I think it carries more weight…”

We must all be on guard against our own ignorance.  For advertisers deploying what once was a useful marketing tool, it is unfortunately much too late.

The Reciprocity Principle

Spurred by the ex-officio public-private partnership Durham Appearance Advocacy Group, city and county officials in Durham, North Carolina are crafting a plan to beautify several exits from the Durham Freeway as it skirts downtown.

The project is to serve as an aesthetic template that will eventually be applied to all interchanges on various controlled access highways as they pass through the community.

But at cross purposes is the desecration just created at an exit less than two minutes earlier where a new pedestrian bridge was intended to be a welcome to downtown.

The desecration also violates a stretch of Durham’s Pearsontown-Rocky Creek Greenway and lays bare a tree screen that had sheltered residential homes and a place of worship, all with the apparent active endorsement of the local chamber of commerce.

So, even if it has legal cover from the State General Assembly and Department of Transportation, why would a company risk the ire of residents in a community long-opposed to billboards when the billboard at that exit already had plenty of visibility through selective pruning and window-framing?

Greed plays a part but so does consumer behavior.  The company that owns the billboard understands that different than advertising placed in magazines and newspapers and on broadcast media, consumer revulsion to the roadside desecration won’t accrue to the company that owns the billboard and responsible for the clear cutting (note Charlotte example in image below.)

Negative reaction will accrue instead to the unsuspecting advertiser paying to showcase its brand on the billboard, even if just as a public service announcement.

Anyone or any organization still considering the use of a roadside billboards under these conditions has plenty of reasons to be concerned, not the least of which is what experts are calling the new “status currency,” the status and vales that consumers wish to project through their purchasing decisions and brand affiliations.

The leading indicators that this consumer behavior will be dominant in only a few years are Millennials, ages 18 to 34 years old, who already account for an estimated $1.3 trillion in direct annual spending and who within 16 years will far outnumber baby boomers such as me.

The highly regarded Boston Consulting Group also describes the two-way, mutual relationship expected by this generation from the companies and brands they use called the “the reciprocity principle.”

It is clear that in the near future, outdoor billboard companies will be unable to hide behind their dwindling number of advertisers.  In fact, Millennials prefer channels other than advertising to learn about products and brands.

Lawmaking bodies such as the General Assembly in North Carolina skew much older than the general population and are among the last to lean on advertising in general, let alone billboards, where there is no editorial other than the message on them to rationalize roadside desecration.

Regardless of political ideology, the hoof beats of obsolescence for billboards will grow louder as Millennials come to power with a sense of reciprocity that relates to sustainability vs. campaign contributions.

My guess is that Millennial lawmakers will not only return roadsides to the taxpayers by permitting only selective cutting for billboards accompanied by a requirement for replanting.

But the next generation of lawmakers will also drive a hard bargain, insisting on a percentage of revenues in return for the parasitic reliance (term used by the Courts) of billboard companies on publicly funded roadways.

Even at this vastly increased assessment, the “reciprocity principle” will also mean this new generation of lawmakers will carefully balance any gain from billboard companies with the damage they wreak on the economic and cultural brands of cities and states.

The infectious disease model that researchers apply to the lifecycle of social media has failed to account for the ability of outdoor billboards to remain virulent—while on life support—after their popularity declined early in the last century through a mix of intense political lobbying and the infusion of huge amounts of cash into campaigns.

This interference by lawmakers from both major parties has undermined the Highway Beautification Act which would have enabled the free market to allow billboards a peaceful exit of their own.

Anyone still persuaded to revive outdoor billboards through desecration of roadsides should visit studies showing that they are:

• used by fewer than 1-in-500 purchasers
• read and enjoyed by fewer than 1-in-10 Americans
• recommended by  only 1-in-25 marketing professionals
• utilized by only 1 in 8 small and medium sized businesses
• utilized by only 1-in 33 small businesses

Even if those extremely low ratios somehow warrant the risk for a dwindling number of advertisers, the “reciprocity principle” among the growing majority of consumers dictates balancing the use of the huge billboards against their impact:

• lowering property values
• air, water and particulate pollution
• turning off relocating businesses
• destroying community and state curb appeal

Any use of advertising these days must be weighed carefully on return-on-investment (now in negative territory overall) rather than just the hope some awareness might be achieved.

The desperation of billboard companies to go digital at even greater costs to society is not for the benefit of the advertiser but to add more and more advertisers to each board, not matter that the visibility for each message is less.

Savvy marketers understand that at the very least a marketing channel such as advertising on a certain medium must require deeper analytics than just being seen.  It must carefully factor and avoid if possible, residual turnoff.

The Advantages of Low Intensity Marketing

I finally got around to viewing the first episodes of 24, a highly acclaimed television series that ran from 2001 to 2010.  I’m hooked now, but I wasn’t interested in the series back when I still had subscription television.

It was annoying to have to wait a week or more between each episode, especially for a series designed with each show covering a one hour period in real time, or 24 hours for each season.

Actually, each show really covers 42 minutes when you take out the  even more annoying 18 minutes of commercials. That means it takes nearly a third less time than it would have before I cut the cord on subscription television altogether nearly a year ago.

Deloitte is currently conducting its eighth State of the Media survey.  A year ago the survey found that, like me, 12% of Americans had cut the cord on subscription television like me and another 8% were considering cancellation.

I remember when a Roper poll in 1980 found that 27% of Americans were using videocassette recorders (VCRs) to record television so they could edit out commercial advertising.  This was just five years after the machines first gained mass market traction as a means to watch rented movies (1980 model shown below.)

That percentage had grown to more than half of Americans by 1989.  It is called “time shifting” now, but even though the transition to digital video recorders (DVRs) began about the same time 24 aired, more than half of Americans now use them to avoid commercials.

Even back in 1996, a Harris poll found that nearly 7-in-10 Americans turned down the sound or switched channels when commercials came on.  Today, researchers have calculated that advertising has a negative return on investment.

You would think that advertisers would grasp that they are turning off seven people in order to reach three with this form of marketing, also called “yelling.”

Even a survey of this year’s Super Bowl ads by the National Retail Federation found that a third of viewers were bothered by the ads, felt they interrupted the game or made the game last too long or believed the advertisers should have saved their money.

And this is an airing where the ads have become entertainment.  But those bothered by the ads outnumber those who were influenced to buy products by nearly 5-to-1.

During my now concluded four decade career in community marketing, the only thing harder than getting local officials to understand marketing was getting them to understand that advertising is the least effective form.

Others involved in economic development seemed especially addicted to big television campaigns which have long been proven far less effective than earned media, also known as publicity.

This is primarily because advertising lacks credibility.  It is the advertiser “yelling” about themselves.  Publicity is lower intensity marketing but more effective because someone else is endorsing.

A new study published in the Journal of Consumer Research may explain how and why low intensity marketing such as publicity is so much more effective than big ad campaigns.

In “Distinctively Different: Exposure to Multiple Brands in Low Elaboration Settings” researchers at Duke University’s Fuqua School of Business in Durham looked at what happens with people fast forward through commercials.

Since the viewers guard is down, even glimpses of a brand at fast forward trigger recall for viewers.  This is essentially what low intensity marketing does but without annoying potential customers.

Using a blend of publicity and social media it is not only more affordable but more credible and more effective than “yelling about yourself.”  Another way to say it is that marketing works best when consumers least expect it.

As Dr. Gavan Fitzsimons who studies consumer psychology at Duke is quoted, “…understanding the interplay of brands and their contexts should help firms better place their messages so they customers are most likely to choose them, and be very happy they did so.”

There are much less expensive ways of assuaging ego than advertising and they won’t result in being more annoying than effective.

Doomed by Greed and Gluttony

My daughter turns 40 this month.  That’s the age I was when recruited to Durham, North Carolina 24 years ago, where I still make my home during a new stage in my life.

A few days ago while watching a young rising senior in college shoot baskets with his father at Duke’s Cameron Indoor Stadium here, I was able to point up to section 3 where we sat when I first introduced his parents to Durham, shortly after he was born.  It also reminded me how young I was when I became a father compared to many of my friends.

I think it made them better fathers.

Now, many studies I read don’t even bother to include results from my age group, such as one just published about how consumers ages 18-60 interact with devices to watch live TV or video on demand.   I find that funny since I use most of these screens and have relinquished subscription television in favor of streaming.

I also wasn’t represented in a survey last month benchmarking tablet use among Americans from the age of my grandsons to age 64.  Nearly half now have access to a tablet including 6 out of 10 between the ages 18 and 34.

Nearly 7 out of 10 now have access to a smartphone.  Many of these studies are performed with advertising in mind.  Often without intending to, they reveal more about its rapid demise.

Tablet use (iPads were introduced in 2010) will likely surpass subscription television this year or next.  Many other screens already have.  Seven out of ten Americans now watch live TV via Internet-enabled devices.  Live television is rapidly becoming a reservation for only sports and news.

Programming free of ads and commercials is now as important as having more channels as a means of generating likelihood to pay for TV content.  The gap between those irritated by commercials on television and those who either aren’t bothered or who don’t pay attention anyway is now only 24 percentage points.

It will only be a matter of months until an ad on television will turn off as many people as who watch or tune it out entirely.  Anyone aware of the purpose of marketing knows television is very close to being a form of “dis-marketing.”

Already more than seven out of ten Americans find all or more than half of video advertising irrelevant to them.  Telling for the future, 23% of Americans are now willing to pay for ad-free programming and 21% are willing to pay to skip them.

Ads are a form of “yelling” to try to get the attention of consumers.  There is a huge industry devoted to selling them, creating them and placing them in various types of media.  The tiny part devoted to outdoor billboards is now more emblematic of “desecration advertising” from roadsides.

Having passed the point of lobbing 10,000 ads per day at the average person and unable to regulate itself, it is clear it isn’t just the obsolete billboard part of this industry that is bent on self-destruction.

Overall, the desperation of this dwindling part of the economy will result in even more “yelling” even as savvy marketers and brands are fleeing to more productive forms of communication.

Too much money is at stake for this industry to go down quietly and as billboards have much of their desperation will find an ear with lawmakers prone to listen to whiners with campaign donations to trade.

Sadly, what was once, with the exception of billboards, an innovate way to underwrite news and entertainment has been doomed by two of the seven cardinal sins, “greed” and “gluttony.”

Carolina Mountain Ironies

Last month, after turning my Jeep Moab off I-40 W and onto US Route 421 for the 80 mile climb up into the mountains of northwest North Carolina, I was greeted by three bits of irony.

First was a huge billboard by the state division of tourism encouraging me to, uh, visit North Carolina’s mountains.  It was just in case I needed reassurance about my destination, I suppose.

Unfortunately, it also sacrificed my view and enabled wanton destruction of trees and vegetation.  Ugh!

Further along the route, as though a dramatic lowering of the speed limit might not be enough to draw my attention,  another billboard loomed bringing news of the opportunity to visit Wilkesboro.

Here the irony was not just the blocked view and canopy desecration enabled by the needless and redundant message.  Tourism promotion in many of these small towns has been siphoned away to subsidize the local chamber of commerce instead.

This redirection is enabled by the failure of many in elected office or municipal or county management to grasp that marketing individual businesses and marketing a community are fundamentally very distinct and very different processes.

Even more ironic than its use of billboards, the chamber for Wilkes County, buoyed by the diversion of tourism tax revenues, also operates by agreement, one of the state’s newest visitor centers, a restful and remarkable sustainability showcase.

Chambers, even in much larger communities, including the one where I live struggle with sustainability.  They talk the talk and even try to walk some of the walk but largely fail to grasp that use of roadside billboards is “desecration” marketing and a signature violation of the triple bottom line.

Unfortunately, so do far too many truly dedicated community-destination marketing organizations.

The new welcome center for northwestern North Carolina is a point of greeting for 10 different counties along or served by that stretch of Route 421 N.  It is well worth a stop if for nothing more than to see a live demonstration of how green technology and infrastructure work.

The North Carolina Department of Transportation maintains a website that illustrates in real time the center’s savings from sustainable and renewable resources.  The center is a way to see first hand how these applications can be made to individual homes and businesses.

Further along my route, rising nearly 6,000 ft, Grandfather Mountain, is an impossible to miss sentinel rising from the Blue Ridge.  But someone there decided that advertising its views was worth ruining my view from the roadside, as did the town of Blowing Rock.

These destinations fail to grasp that they are turning off 8 to 9 travelers for every one to which their desecration marketing may appeal.

Advertisers, especially those still using roadside billboards, not only fail to understand this ratio, they fail to understand that marketing destinations after visitors are enroute is largely wasted.  Those decisions were made long before the journey began.

As a McKinsey white paper notes, “marketing has always sought those moments, or touch points, when consumers are open to influence.”  The paper summarized studies and evaluation that changes how marketers must view marketing.

No longer, if it ever was, is marketing merely a funnel along which those still using advertising can “push” messages at consumers as those along my journey up US 421 tried to do.

Instead, marketing is a series of cycles with far more touch points at the beginning and nearly none in the case of travelers after the decision on where and why to travel has been made.

Trying to divert them along their journey or to cannibalize part of their trip is wasted, a type of zero-sum marketing.  We know from other research how dominant the primary destination is to a traveler.

Those heading up US 421 into the North Carolina mountains aren’t on “fishing expeditions” hoping to add destinations along the way.  Even if travelers think they are open to side excursions, research shows that in reality travel distance tolerance, especially for unplanned excursions, shrinks to almost zero.

There are many excellent metrics by which travel decisions can be measured and by which communities can rate the effectiveness of their destination marketing.

One that should surely raise concern for any destination overseers is any continued use of obsolete roadside billboards, now seen as useful by less than a fifth of one percent of consumers.

More than just wasted spending, these billboards are a turn-off to eight out of ten of the very people they are trying to attract in the first place, resulting in reverse marketing.

Cultural Currency – Traditional vs. Digital Advertising

It is difficult to find totally objective studies about advertising outside of academia.  A new report on “cultural currency” (broad audiences that effect significant social media behaviors) was conducted on behalf of television, but it also reveals some interesting social media associations related to other forms of media.

The recent study by TVB, a trade group for television in collaboration with Colligent, aims to better inform advertisers seeking to leverage social media during traditional advertising.  They found that “commenters” and “photo-video posters” favor local television programming and “likers” favored local radio and cable TV.

However, frequent “commenters” and “likers” favored local radio, “tweeters” favored local newspapers, “hashers” favored cable TV while “retweeters” favored local newspapers and “repliers” favor local TV.

Social media behaviors also varied by type of programming.  For example, dramas favor Twitter and game shows favor Facebook.  A summary of a study by Viacom notes that after “following” or “liking” a TV show, 75% are more likely to watch it.

According to an April report by Massachusetts-based Burst Media, advertisements seeking to prompt social interaction were least effective on outdoor ads at 12.7% with 9.5% recall.

Studies make it difficult to see the amazing free-fall in the effectiveness of traditional billboards but you can see it in the huge number that are vacant or obviously donated to unsuspecting non-profits at inflated values to avoid paying taxes. (now there is an area the IRS should target.)

Performance of this nearly obsolete but highly destructive form of advertising is buried now in a category called “out-of-home” (OOH) which also includes airports, doctors’ offices, gas stations, grocery stores, health clubs, elevators, bars, retail stores and malls.

Nearly half of all OOH digital advertising revenues now in the U.S. are unrelated to digital roadside billboards.  This further undermines the billboard industry's claim to being relevant or indispensible economically.

The claim is further made absurd by netting out the far greater economic benefits from the trees it destroys let alone the view-shed which is truly crucial to economic development.

Now inundated by 10,000 ads per day, the only place the average consumer finds ads useful is on these so-called “place-based” (actually venue-based) digital screens because they see them when they are actually in stores or malls.  Still, according to Nielsen, while up to 82% view the screens (in malls,) overall only 18.1% can recall the advertiser.

McKinsey noted in a 2009 white paper that unless a consumer is actively shopping (either physically or virtually) when they happen to see an ad, the exposure is largely wasted.

This has always been true, it just became more obvious during the emergence of an on-going experiment called online shopping.  This fact underlies as much as too much volume why advertising effectiveness has fallen from zero into negative territory.

An Arbitron study of these digital place-based screens estimates that in a 30-day period they are seen by 108 million adult U.S. residents: 6% in an airport, 13% in a mall or a gas station, 14% inside a retail store, 17% in a grocery story and 24% in a restaurant/bar.

The study reveals that viewership by income and education and age vary widely by place, a word usually reserved for destination communities but applied to venues for OOH media by Arbitron and Nielsen.

For those inclined to view these OOH place-based screens, or just bored while waiting for flights or for a dining partner to return from the restroom in a restaurant, they may be good venues, especially for novelty products or new product launches.

OOH venue-based screens are no more conducive to sense of place than the roadside versions but if kept to a minimum, they far, far less destructive.

Occurring only after a someone is shopping, they are also less likely to alienate more people that to which they appeal and they may enable society to reclaim scenic view-sheds along roadsides and the healthful benefits or uninterrupted roadside forests.

However, even for digital ads, platforms such as desktops, tablets and smartphones, with a recall of 60.9%, far outperform OOH place-based screens, television, radio or print when it comes to leveraging social media, according to the Burst Media survey.

Advertising is a form of “yelling” to get attention, so by definition it always has far less credibility and recall.  The industry only knows how to “yell” louder and louder with more and more ads flooding the average person’s view-shed.

It has no sense of or ability to self-govern or it would arbitrarily reduce the yelling from 10,000 ads per day per person to something closer to 2,000.  That would still be nearly three ads per minute we’re potentially awake.  The overload is all about money, not the advertising, not the consumer.

Until the advertising sector finds the means to do so, this element of marketing is fostering its own extinction.

Infographic - What Is Native Advertising?

To view this infographic at its origin, click here or here.

Powerless To Self Regulate

In the early 1970s as I graduated from college, the average American was exposed to fewer than 500 advertisements a day with a good portion coming from those occupying 15% of each hour of television programming back then.

By 2009, just as I was retiring from a nearly 40-year career in community-destination marketing, Dr. J. Walker Smith quantified the average number of ads to which we are each exposed each day showing it had shot up to 5,000 and many project that this deluge will hit 10,000 within this decade.

It isn’t just commercial television which now fills 25% of each hour with advertising but now multiplied over 100 times more channels that is responsible.

Huge digital roadside billboards that change messages 21,000 times per day make this ad overload even more absurd while their huckster owners argue with straight-faces to passive gatekeepers that blinking that many times should not be disqualified as intermittent which is prohibited.

Studies over time show that the overall effectiveness of advertising has fallen to very near “0” or below for all but a handful of categories.  The average improvement to sales or market share generated by a 1% increase in advertising is a tiny 0.1% according to Dr. Gerard Tellis at the University of Southern California’s Marshall School of Business.

The analysis also shows that throwing more advertising “weight” at the consumer is futile.

Fortunately, there are many other elements of marketing communication from which to choose that, while not as glitzy or soothing to advertiser egos, have far more credibility with consumers.

The sheer ubiquity of advertising is backfiring and not just on advertisers who still use obsolete media such as outdoor billboards that desecrate communities and roadsides.

Unfortunately, it appears that much of the advertising-industrial complex is either oblivious or, feeling powerless to self-regulate some restraint among peers, just keeps pushing like an addict at each new medium to maximize its “ad load.” 

Few acknowledge or care that there is clear evidence that many advertisers are now turning off many times more consumers than they turn on.

Worse are bottom-feeders who nip at the heels of struggling newspapers, magazines and now broadcast media, hoping to step into the void by someday leasing space and producing their own programming as some companies did at the dawn of the communications age.

6 Reasons Campaign Advertising Is Futile

On Nate Silver’s blog FiveThirtyEight, political scientist John Sides recently posted an excellent two-part breakdown from the perspective of a political scientist describing when advertising does and doesn’t work for political campaigns.

In short, political advertising by a candidate isn’t that useful unless the candidate is unfamiliar, then only if one candidate greatly outspends another and even then “not for long.”  The ads don’t affect turnout and even when negative, the results are mixed.

This information won’t be new to many marketers including those responsible for community/destination marketing.

The overall effectiveness of advertising has been in dramatic decline but this one element of marketing is often an obsession for a handful of people in every community and especially campaign advisors, most of whom seem to have an understanding of advertising which is wrapped up in ego.

It is big and brash.  It is you telling the world about yourself.  It is Tarzan pounding his chest in the jungle.

But advertising lacks credibility because it is “you talking about yourself” and if there is any group in desperate need of credibility, it is politicians and especially candidates running for office. They rank dead last in surveys of public trust, lower than any other category.

If you happen to see the movie Moneyball you’ll see a humorous depiction of folks who obsess over advertising as a cure-all.  They are similar to the “grizzled advisors” who frustrate the real-life Billy Beane, portrayed by actor Brad Pitt in a film based on the Michael Lewis best-seller, a page-turner about data-driven decision making.

Like Beane’s advisors, folks overly wedded to advertising in this day and age usually are very sensory and rely on what they think they know and who they know without informing it with data.  As Sides warns, “be particularly skeptical of claims” by people who stand to gain or are linked to those who stand to gain from placement of advertising.

Silver’s blog is always worth tracking.  But the first of a two-part post by John Sides on campaign advertising posted on October 5th and another on October 12th are spot on and anyone involved in marketing has probably already experienced the lessons learned by political scientists studying the ineffectiveness of campaign advertising:

1. Campaign ads matter more when a candidate is unfamiliar.
2. Campaign ads matter more when a candidate can outspend.
3. Campaign ads can matter but not for long.
4. Negative ads work, except when they don’t.
5. Campaign ads don’t really affect turnout.
6. There is no secret sauce.  Really.

As Sides notes (click here for part 1 and here for part 2,) much of what goes into modern campaign advertising is largely futile despite the anecdotal hunches of old-school campaign strategists.

Studies show the same is true for any kind of advertising, especially those using outdoor billboards in which case any business brand using them is sure to alienate  seven or more times the number of people who may utilize the messages they contain.

Today, there are simply far too many other significantly more effective marketing alternatives to being sucked in by those obsessed with what is often characterized as “Tarzan or ego-marketing.”

Brain Hacking, Commercial Speech and Ethics In Marketing

I may be wrong but my experience in associations over the years, particularly on legislative committees, makes it pretty easy for me to see how a small number of individuals would have been able to get the American Advertising Federation and the Association of National Advertisers to file briefs in U.S. District Court objecting to the new visual marketing the FDA plans to add to tobacco packaging next year.

Of course when the government wants to use marketing to warn consumers, many marketers argue, as I assume this brief will try to do, that it is being propagandistic.  They argue freedom of “commercial speech” which is ironic since they essentially seek to deny freedom of information.

Many marketers view the new warnings on cigarette packaging as hypocritical because they still think of taxes on tobacco and alcohol as they functioned up until the early 1900s when prohibitionists supplanted them with the progressive income tax as the means of funding public services.

Prohibitionists and other groups may have been able to push through the income tax in part because so many people didn’t think they would have to pay it.  Southerners in particular relished the fact that the substitution shifted 44% of the tax burden to New York State alone, a kind of payback for Reconstruction and the prohibition of slavery.

Following the repeal of prohibition, taxes on tobacco and alcohol resumed but evolved more as “sin” taxes, used to curb consumption or recoup healthcare related costs.  So this is one tax where government is actually hoping to put itself out of business.  It is also why legalization of drugs is one area where conservatives including libertarians and liberals seem to agree.  Even after nearly 100 years, we have yet to fully apply the lessons of prohibition.

The argument by thoughtful marketers regarding the new warning labels for tobacco is that, if it is legal to produce and sell a product to the public, it should be legal to market it even if unfortunately for far too many marketing is still  restricted to just one element: advertising.

Fair enough, but it doesn’t appear that  new warning requirements will actually curb the ability to produce or market or advertise tobacco, just make it more complex.  The graphic warnings  are just based on the principle that many smokers don’t read text, nor do they have any idea the taxes in return that smokers levy on society in general in the form of healthcare costs.

As a marketer for nearly four decades in community/destination marketing organizations, I’m also very conscious of surveys about “truth in advertising,” which is just one element of marketing.  It is clear that neither attempts at self-regulation within the ad industry or the Federal Trade Commission are very effective.

It isn’t the 19% of Americans who believe advertising is truthful all or most of the time that worries industry ethicists; it is the 65% who trust advertising to only “sometimes” be honest and the 13%, or just over 1 in 10, who say they never trust advertising.  It is just one factor that has led to the dramatic decline in the effectiveness of advertising, as documented in scientific studies and leading savvy marketers to shift to other alternatives.

Creators of an award-winning advertising campaign for Montana were just exposed for using images taken of Wyoming.  It reminds me of an excellent classroom presentation a few years ago on ethics in advertising by former Ogilvy exec Chris Moore of Brains for Rent during which he described the very slippery slope down which the creators of Montana’s campaign fell:

“So we tell the truth - but not always the whole truth. We want to put our clients in the best light…How much of the truth we owe to others is an ethical question. In practice, the answer depends on who they are and what's at stake.”

It is true that there are very thin slivers of Yellowstone National Park located in both Idaho and Montana, and there are a couple of popular gateways to Yellowstone from Montana, one of which I used during a visit a few weeks ago, but the vast majority of the Park is located in Wyoming.  It was deceptive advertising and sadly there are far too many excellent reasons to visit Montana that are actually located there to take such an unethical risk.

When I arrived in Durham more than two decades ago to jumpstart community/destination marketing here, this type of unethical advertising was rampant in North Carolina.  Raleigh was claiming scores of Durham assets in brochures about that community, State officials were marketing the airport, which is located midway between and co-owned by Raleigh and Durham, as the Raleigh airport, Greensboro was blatantly advertising itself as the location of the North Carolina Zoo actually located in Asheboro and Charlotte was claiming to be the location of stock car races actually located in Concord.

Sadly, I had to pull out a copy of the code of ethics for destination marketing to get Raleigh to back off and then begin the decades-long task or rectifying the deliberate misinformation and reclaiming Durham’s identity.

The ethical issues surrounding advertising are also the reason why so many entrepreneurs find that customers prefer fee-based models even though competitors offer something similar for free but subsidized by advertising.  As one was quoted by Clive Thompson in Wired Magazine recently, “once you’re not just charging people straight up, you get into all these murky ethical things.  You have to sell their eyeballs.”

Of far more concern to me, even as an outspoken proponent of research-driven marketing, are the new ethical issues surrounding innovative new methods of “hacking into consumer brains” such as the neuro-marketing described in a Fast Company magazine article written last month by Adam Penenberg.

The article is about a breakthrough approach pioneered by NeuroFocus that according to the author “will collect the resulting streams of data and use them to analyze the participants' deep subconscious responses to the commercials, products, brands, and messages of its clients.”

It will only intensify the debate about ethics in advertising.  Will the “deep subconscious responses” be used by product developers and marketers to benefit consumers or harm them by plumbing into addictions for everything from obesity-driven fat and snacks and sugar?

People involved in marketing make numerous ethical choices every day, especially when it comes to the element of advertising and few are black and white.  One advertising ethics presentation likens an advertisement to a job interview:

“When you go on a job interview or a first date, you don't assume a false identity - but you probably don't make a full disclosure either. Chances are you keep your lactose intolerance and foot odor issues in the background…”

We know that consumers only pay attention to an advertisement for an average of 6.5 seconds and even though more than 80% of all American companies now have a written code of ethics, there are no simple answers.

With so many ethical considerations to be resolved, the two advertising organizations mentioned at the beginning of this blog are making a huge mistake by making product warning labels an issue of commercial free speech.  All this will do is further alienate consumers and make them even more skeptical of marketing.