Thursday, July 16, 2009

The Evolution of Online

It was once a universal truth that online advertising plays poor relative to the creative nobility of the advertising & marketing agency world. In creative terms, online is considered perhaps less a poor cousin and more dwarfish stepbrother with one eye blind, hearing impaired and a speech impediment. For this reason, the Internet was once viewed solely as a place for direct response campaigns, and certainly not to be trusted with building a brand or driving awareness.

But the ugly duckling is slowly becoming the swan as it moves out of its infancy, and starts having cool haircuts and trying to find a girlfriend. With this, the online creative scene is finally embracing the power, vigour and sexual allure that relative youth can bring, while its daddy reaches for the vitamin pill and looses all sense of rhythm. But what’s behind this blossoming of online? Now that it’s come of age, what is the proper pursuit for a medium that for so long could but crawl, dribble and manage a few simple words like “click here”?

It all comes down to people. The people doing it, the people paying for it and the people consuming it. The people doing it are better.

There was a time when online ads were largely produced by designers who, despite being good designers, were not ‘creatives’ schooled in conceptual thinking. “Knocking out” a few banners as an afterthought, based on whatever design concept they’d used in the header of a client’s website lead to ads devoid of an idea and unable to communicate a proposition to an audience. As creatives replace designers in digital agencies, this problem fades.

The slow down in the advertising market as a whole has benefited digital agencies. Good planners, account people and creatives have begun to consider online as a career option - with the industry growing, a future online looks more secure than in traditional agency roles. The more good people, the better the level of work, which in turn attracts bright graduates to the industry. It’s still the case that most creatives looking for their first job favour big ad agencies, but the reality of life in a traditional shop is often frustrating for creative free spirits. Top accounts being bagged by senior teams and internal competition gives rise to a viper pit atmosphere. Within the online space, there’s room for bright young teams to work on edgy ideas for major brands from the off – and with the relatively fast turnaround on digital projects, they aren’t stuck servicing the same account day in day out. All this makes for a creative vitality producing better and better ideas on the Internet.

The people buying it understand and appreciate it
Agencies can’t take all the credit. The increasingly savvy marketing manager is embracing online as never before and there is something of a “viral” effect taking place as web-literate decision-makers move jobs, helping grow online budgets in companies that once overlooked digital entirely. And with the legendary measurability of online including SEO and SEM, the talented marketer has the tools to persuade boards to release cash.

But it’s always been measurable. What’s changed is that strong brand building creative ideas capable of motivating customers are offering brands the ability to gain unprecedented consumer insights. It’s no exaggeration to say this is transforming the way brands market themselves - FMCG companies now have tangible relationships with the customer unmediated by the big multiples. This is nothing short of revolutionary and is slowly beginning to release the kind of budgets that provide scope for bigger ideas.

The people buying it have the money for it
Marketplace factors that have threatened traditional agencies are benefiting the upstarts. Audience fragmentation on TV, longer working hours and the break down of traditional demographic groups all benefit a highly targeted medium like the net. So while budgets have gone down in the last one year, the proportion of spend online has gone up 50% year on year since 2004. Meanwhile, increasingly brand literate consumers are demanding new things from their communications.

The people consuming it are responding positively
With broadband users accounting for many home Internet connections, an assured good experience means that consumers are spending more time online in greater and greater numbers. The internet now accounts for approximately 10% of all media and news consumption3 and within certain demographics, the Internet is almost the only place to guarantee a satisfactory ROI – the average 21-34 year old spends over 28 hours a month on the web. The more time consumers spend online, and the more money they have with them, the more online as a branding medium becomes relevant. As we know from the offline world, it’s a great deal easier to inspire loyalty and sell premium priced products to consumers who engage with the brand.

From passive to interactive real-time communication
Online excels at engagement - interrupting someone with a 60 second TV ad, does not compare to the possible “time with brand” achievable online. The best online campaigns can capture attention by interruption with a 10-20 second ad and keep that attention with entertaining and informative content on a brand site. The end point of this chain of engagement could be a data-capture opportunity or a purchase, but the motivating factor for the customer is entertainment and information. If the creative standards are high enough en route, the customer may spend up to 15 minutes with your brand before going back to what they were doing.

Using time efficiently with brand
With an entertaining brand experience a good digital agency can keep a consumer engaged. But the key to understanding the potential for brands online lies in what a business can do with that opportunity. Until the Internet arrived, brand communication, driven by TV ads was characterised by the passive consumer receiving messages. It was a one-way process and the advertiser had little genuine insight into response. In order to combine brand experience with consumer insight, DM was brought into the mix. The draw back with Direct marketing is that high creative standards tend to be prohibitively costly for all but the highest ticket purchases (cars, etc). Now that the Internet can deliver on the creative impact and audience reach necessary for brand advertising, its unique strength comes into play. The web combines the reach of TV with the targeting and consumer insight of traditional DM.

In order to benefit from this powerful combination, businesses must embrace a communications process that recognises the importance of a seamless, entertaining journey from ad to transaction. It’s not sufficient to rely on highly creative advertising that simply sells “off the page”. Effective digital strategies require a combination of creative ads with engaging websites, insightful information architecture and business processes geared up to receive and understand the information customers are prepared to give as they interact. Done correctly, joined up branding becomes a virtuous circle where valuable consumer insights are gathered at each part of the customer journey and are fed back into the creative process to develop a more and more engaging brand experience.

The future & beyond
Those businesses that embrace the power of the Internet as a branding medium now will make considerable gains in the future. Higher speed broadband (2MB speeds and upwards will be the norm) will enable companies to deliver richer content and in so doing they will be able to harness consumer interaction more easily. As web use becomes ever more convenient, consumers will continue to spend more time online and will look for brand propositions that deliver entertainment, service and convenience. Brands that understand the importance of a consistent two-way relationship and have the crucial business processes in place, will benefit from a trading environment that brings them as close to their customers as a medieval merchant once was.

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