By Marni Gordon, vice president of committees and conferences, ANA
Posted: Sep 20, 2013 12:00am ET
I attended the “360i Marketing Summit 2013” this week in NYC. 360i brought their clients and partners together to learn from each other on topics related to the key theme of the event: “Navigating Disruption: From Big Data to Big Ideas”. My favorite session was a panel moderated by Sarah Hofstetter, President of 360i on “Marketing in a Real-Time World”. Marketers from Ben & Jerry’s, Mondelez International (Oreo), and USA Network participated on the panel and shared great insights on how to balance brand authenticity with cultural relevance in a real-time world. Some of the key lessons learned to success in real-time marketing were:
- Consumers can affect your reputations in a heartbeat: Brands need to regain control by knowing your surroundings (listening) and bring original.
- Be precise on what your brand stands for: It is important to be true to your brand’s core values and beliefs.
- Trust internal client teams and your partners. All involved need to have one brand voice and have the freedom to take risks.
- Content is king and can take many forms: No matter what the medium, brands are storytellers and need to make sure they are sharing the right stories.
ANA’s first-ever Real-Time Marketing Conference presented by Starcom is December 4th in NYC! Learn from Kraft Foods Group, The Coca-Cola Company, Hasbro, Anheuser-Busch, MINI, MasterCard Worldwide, Nestle and more!!! I look forward to seeing you there!
By Bill Duggan, Group EVP, ANA
Posted: Sep 19, 2013 10:55am ET
Marketing procurement should be aware (keenly aware) of the value and benefits of in-house agencies. In-house agencies offer key benefits, per the recent ANA report “The Rise of the In-House Agency.”
- Cost efficiencies are the most often mentioned advantage of in-house agencies.
- Quicker turnaround time is also a major benefit.
- Factors such as institutional knowledge and having a dedicated team have grown in importance.
The current marketing environment, with its increasing emphasis on productivity, speed, and cost-effectiveness, lends itself well to in-house agencies.
Our research indicates that procurement currently has some influence in moving business from an established agency to an in-house agency. Among those companies that have a marketing procurement department, 45 percent say procurement is somewhat or more influential in deciding to move business in-house. This influence is likely to grow. Just as production decoupling and media auditing burst on the scene a few years ago and became strategic drivers of value for procurement, in-house agencies can also provide substantial value. Marketing procurement should take notice!
By Yasmin Melendez, director of committees and conferences, ANA
Posted: Sep 18, 2013 9:33am ET
Last week, 15 ANA members from a variety of industries including financial services, QSR, CPG, health care, spirits and telecommunications gathered at ANA headquarters to review over 185 entries submitted for the Multicultural Excellence Awards. Now in its 13th year, these awards recognize marketers and their agencies or media company for their outstanding work in advertising to African-American, Asian, Hispanic, and LGBT audiences.
Over the course of two days, judges evaluated 370 pieces of creative and discussed and sometimes debated the cultural insights used to target multicultural segments in a variety of mediums. The predominant sentiment was that although the discipline has made great strides, there's still a lot of work to be done. Here are some of the takeaways I took from the experience:
- Senior Management Support Matters - This year two entries pushed boundaries by portraying interracial or intercultural couples. According to the 2010 census, interracial and intercultural couples represent 10% of couples in the US. That's over 30 million Americans! Companies such as General Mills and American Family Insurance among others have started to show this new reality in their advertising and have met with public criticism. Having the commitment from the c-suite to weather the storm will ensure that marketers continue to break new ground.
- Execution Counts More Than Budgets - It was refreshing to see creative that were simple and yet powerfully effective in targeting their respective audience segment. While budget cuts may force some marketers to translate general market creative, being targeted and using cultural insights is always more impactful.
- Multicultural Marketing Goes Beyond Color - While the majority of the budgets are spent in marketing to Hispanics, African-American and Asians, this year we saw campaigns targeting Indians, Native Americans, Brazilians, and Western European ex-patriots living in the United States. Cultural insights go beyond skin color and the opportunities for marketers are endless if done right.
- The Void of Luxury Brand Advertisers - The 2010 census data revealed that "affluent" Hispanics, African-Americans and Asians each comprise 7-9% of the US population. Affluents are categorized as those with a household income of at least $100k. While kudos to those luxury brands that are marketing to multicultural consumers, the examples we reviewed showed that there's still a long way to go.
- "Total Market" Can Go Awry – The "Total Market" Approach is seen as a cost effective way to connect with several segments, but if not executed properly the creative can underwhelm. The best total market creative surprised and delighted judges in its subtle and yet powerful use of cultural insights to transcend ethnicity.
By Bill Duggan, Group EVP, ANA
Posted: Sep 13, 2013 3:33pm ET
Dictionary.com defines disintermediate as: “to attempt to do away with intermediary entities between two primary market forces; to eliminate the middleman.” ANA has released a new report, “The Rise of the In-House Agency,” and traditional ad agencies need to take notice of the findings, or risk disintermediation.
The current marketing environment, with its increasing emphasis on productivity, speed, and cost-effectiveness, lends itself well to in-house agencies. Furthermore, the increased use of newer media (digital, social, mobile) puts a premium on turnaround time/speed, accelerating the expansion and importance of in-house agencies.
In-house agencies are rising to play bigger, more sophisticated, and strategic roles. External agencies are being disintermediated to some degree by in-house agencies. A majority of respondents in our research say that they have not only moved established business that used to be handled by an external agency to their in-house agency, but have also assigned newer functions, like digital/social/mobile, to their in-house agency. Such disintermediation has already happened in production, as more marketers decouple production from their creative agencies. There will be even greater disintermediation if the penetration and stature of in-house agencies continues to grow.
External agencies need to take notice, as the growth of in-house agencies may indeed be a warning sign that marketers are questioning the role of traditional shops. As the traditional agency marketplace continues to evolve, such agencies must reassess and redefine the value proposition they provide to clients. The rise of in-house agencies has great benefits to client-side marketers, and agencies must now give more consideration to how this affects them.
By Bill Duggan, Group EVP, ANA
Posted: Sep 10, 2013 10:02am ET
I attended the opening day of the “The Total Market Conference” from the Cross-Cultural Marketing & Communications Association on Monday in NYC. According to the CCM&CA, the total market is the description of a business vertical emerging within the marketing and communications industry; it describes the converging “general market” and multicultural business verticals. The purpose of the association is to provide total market enterprise and cross-cultural marketplace awareness, education and certification across business, governments and education verticals. Lots of rich information was shared and a half dozen key takeaways for me follow:
- Importance of Millennials: There is no bigger single source of growth today than millennials and multicultural millennials in particular. Over 40 percent of millennials are non-white. (Jeff Yang, The Futures Company)
- Wall Street Loves Multicultural: Multicultural audiences can be the first to demonstrate growth trends that can drive the entire market and also drive financial valuations. (James Dix, Wedbush Securities)
- Brand Value Increases by Total Market Appeal: Having a brand that appeals to the total market increases brand value. Strong cross-cultural brands have meaningful connections across all major ethnic segments – Hispanic, African American, Asian, and White. Subway and McDonald’s were cited as the top brands in the QSR category. (David Burgos, Millward Brown)
- It’s “Cultural Branding” rather than “Multicultural”: Pepsico uses the term cultural branding instead of multicultural. They are not just looking at ethnicity but considering the role of culture in music, sports, and more. The move from multicultural to cultural branding can have a positive impact on funding and the perception of the team within the organization. (Javier Farfan, Pepsico)
- Research is Lacking: The research segment has not caught up to the needs of multicultural marketers. (Lizette Williams, Kimberley-Clark)
- Employees are Vital: Your employees are perhaps your most important consumers and your employee base needs to mirror your consumer base. (Greg Kuczaj, Towers Watson)
By Bill Duggan, Group EVP, ANA
Posted: Sep 5, 2013 10:02am ET
ANA has released a new report, “The Rise of the In-House Agency,” and the findings are most interesting. Highlights:
The penetration of in-house agencies has increased 16 percentage points, to 58 percent, from our last survey in 2008. Also, there has been an increase in the number of employees on staff at in-house agencies.
- These increases are, in part, a reflection of the economic environment in which corporations have reduced budgets and are being challenged to do more with less. Moving the agency in-house — or increasing the role of an existing in-house agency — can help reduce costs.
- The growth of digital/social/mobile and the need for quicker turnaround for those media has played a role in the increased penetration and responsibilities of in-house agencies.
The services handled by in-house agencies are varied.
- The most commonly handled service by virtually all the in-house agencies surveyed is creative for collateral/promotional materials. Email, tradeshow/event materials, and direct mail are also widely serviced by in-house agencies.
- Half of all in-house agencies handle some level of media planning and/or buying.
- Newer media — specifically, social media, online display advertising, and search engine marketing — rank high on the list of media services handled in-house. In fact, when asked an open-ended question about the biggest changes in their in-house agencies in the past year, a significant number of responses centered around newer media.
In-house offer key advantages and appear to be growing in stature:
- Cost efficiencies are still the most often mentioned advantage of in-house agencies, although the percentage of respondents naming costs as the primary advantage has declined significantly since the 2008 survey.
- While quicker turnaround time is also a major benefit, other factors such as institutional knowledge and having a dedicated team have grown in importance since 2008. This indicates that in-house agencies are increasingly more sophisticated and strategic, not just “fast and cheap.”
Traditional agencies are being disintermediated to some degree by in-house agencies. A majority of survey respondents say that:
- They have moved established business that used to be handled by an external agency to their in-house agency.
- They have assigned newer functions, like digital/social/mobile, to their in-house agency rather than to an external agency.
The full report is available onthe ANA website.
By Bill Duggan, Group EVP, ANA
Posted: Aug 30, 2013 10:03am ET
Over the last few months ANA has been surveying our members to better understand the penetration and use of in-house agencies. We will officially release that research on September 4 and have a webinar scheduled for that day. The findings are most interesting!
We define an in-house agency as “a department, group, or person that has responsibilities typically performed by an external advertising or other marcomm agency.” Note that an internal PR function is not part of our definition of an in-house agency.
Many ANA members have in-house agencies and a dozen examples are: Adobe, AFLAC, Blue Shield of California, Combe, Dell, Fidelity, IBM, Kraft, Marriott, True Value, Wells Fargo, and Wendy’s.
Traditionally, marketers have used in-house agencies for cost savings and quicker turnaround times, and those are still valid reasons for having an in-house agency. Our survey shows that the penetration and stature of in-house agencies is rising. This increase is, in part, a reflection of the economic environment in which corporations have reduced budgets and are being challenged to do more with less. Moving the agency in-house — or increasing the role of an existing in-house agency — can help reduce costs. The growth of digital/social/mobile and the need for quicker turnaround for those media has also played a role in the increased penetration and responsibilities of in-house agencies.
“Fast, cheap, good — pick two!” Most every marketer and agency exec has heard that quote. For years, in-house agencies were known as being fast and cheap, but not necessarily good. Now, many are good — in fact, very good – and are providing critical strategic services.
This new research provides insights into the services that in-house agencies handle, the degree to which external agencies are displaced by in-house agencies, the advantages and disadvantages of in-house agencies, the internal costs to the company of employing in-house agencies, and more. In-house agencies are indeed rising and are now more important than ever! We’ll share more in upcoming blogs following the release of the research report.
By Bill Duggan, Group EVP, ANA
Posted: Aug 20, 2013 10:02am ET
I just came across two great articles related to commercial loads.
Al Jazeera America, which launches today (August 20), announced that it will have only six minutes of commercials each hour. This low ad ratio is "one of our key competitive advantages," according to their CEO.
Meanwhile, I came across a blog titled Get Stronger While Watching TV, where the author wrote, “While on vacation, we were watching the Godfather on AMC. I was feeling a little antsy, so I decided to do some push-ups during the commercials. The commercial breaks were pretty long, so I did between 25 and 50 reps on each break. By the end of the movie, I had hit 500!”
The commercial loads on many cable networks in particular have really gotten out of control. Long commercial breaks diminish the effectiveness of an advertiser’s message. Viewers can’t help but tune out of advertising when there is a relentless parade of commercials. And advertisers with spots in the middle of the pod likely are over paying as rates are based on average commercial viewership rather than brand-specific commercial ratings. Prolonged commercial breaks are not in the best interest of advertisers!
Al Jazeera America has the right idea and more networks are encouraged to better manage their commercial loads.
By Bill Duggan, Group EVP, ANA
Posted: Aug 7, 2013 10:02am ET
The following is an initial perspective from ANA on the Publicis-Omnicom merger, as provided to Ad Age.
We’ve heard concerns from some members about competitive conflicts. Bringing Publicis and Omnicom together will bring competitors under the same holding company umbrella. In some cases fierce and direct competitors. In other cases, indirect competitors. Marketers are working with more agency types than ever before and usually unbundle their work to multiple agencies—creative agency, media agency, specialty agencies, etc. So the ability for Publicis and Omnicom to put up firewalls to safe guard against conflicts becomes even more complicated. There are more agencies and more firewalls required. And therefore more risk of leaks in those firewalls.
And there are concerns we have heard from members about options becoming more limited, as two holding companies are merging into one … and one holding company option is now going away.
This may now present an opportunity for smaller and mid-sized agencies to be seen as attractive options if clients are concerned about conflicts from this merger or the now reduced number of holding company options. But the smaller and mid-sized agencies are likely to be domestic/U.S. based solutions and not global solutions.
The merger will bring expected benefits to Publicis and Omnicom with efficiencies from size and scale. Marketers may benefit from that size and scale. There has already been some speculation in the press that the merger could bring the benefit of greater media efficiencies (Brian Wieser perspective), given the combined clout of the two holding companies. But marketers also hire agencies for innovation and creativity. Clients of Publicis and Omnicom should directly ask their agencies – “What’s in this for me? “How will this impact my business?” Marketers who are clients of Publicis and Omnicom, in fact, have a responsibility to have those candid conversations.
ANA will host a webinar on this issue on August 21 with Brian Wieser of Pivotal Research.
Posted: Jul 23, 2013 12:43pm ET
Editor’s note: Todd Wilkinson’s work is well known to readers of ANA Magazine. Over the years, he has written numerous profiles and think pieces about leading CMOs. His new book, Last Stand: Ted Turner’s Quest to Save a Troubled Planet (Lions Press), demonstrates how companies that do good by their customers and their environment can be rewarded in the marketplace. We invited Todd to pen the guest blog below about Turner’s best business practices that still guide him as he tries to blend economic profitability with the goals of preserving the natural world and helping humanity.
By Todd Wilkinson
The first thing you need to know about Ted Turner is that he rejects the premise that economic prosperity must translate into a despoiled environment. “I believe the object of being a responsible business person is to leave the lives of those you come in contact with richer, not poorer; smarter, not dumber, and fuller rather than more depleted,” he says.
Make no mistake, the green Turner is a shrewd businessman, an innovative thinker and billionaire who time and again has demonstrated an uncanny ability to peer around corners and anticipate new emerging trends in society. While plying his fortune as a do-gooder and tree hugger, he’s also a believer in free enterprise. “Capitalism isn’t the problem,” he says. “It’s how we’ve been taught to practice capitalism that has caused dire problems in the world, affecting nature and human quality of life.”
In writing Last Stand, I thought a lot about the great conversations I’ve had over the years with ANA member CMOs at some of the biggest companies, as they share a lot in common with Turner. Last Stand is a story about conscientious leadership. Here are seven lessons from Ted based on his own slogans or aspirational mantras that have guided him over the past 50 years.
Early to bed, early to rise, work like hell, and advertise. This was the first maxim taught to Turner by his father in the 1960s. Ed Turner, the family patriarch, had built a regional advertising business in the Southeast armed with an arsenal of billboards. Indeed, it was this mom-and-pop operation that Ted Turner parleyed into a global media empire in Atlanta. In hindsight, Turner believes the phrase speaks to more than an obvious roll-up-the-sleeves work ethic. His best ideas, he says, always emerged from getting a full night’s rest. In fact, Turner believes that it’s better to approach a business opportunity from the promise of rising sunrises than from the fading light of dusk. A notorious workaholic, Turner says effective advertising is about more than pitching a product — it’s about the execution of purposeful vision, persistence, and helping others open their eyes to understanding broader landscape
Either lead, follow, or get out of the way. These words are etched into a plaque that still sits on Turner’s desk in Atlanta, and they were a guiding mantra that carried forth his famous underdog battles. They inspired him when he skippered the yacht Courageous to victory in the 1977 America’s Cup; when he started TBS the Superstation and pioneered 24-hour news with CNN; when he turned the hapless Atlanta Braves into a perennial pennant contender and World Series champion; and when he’s tackled major conservation, humanitarian, and national security initiatives. For Turner, the slogan means having the courage to be innovative, and not letting your own fears stifle others from seeking the next big idea. “The best breakthroughs that I’ve been involved with started with naysayers proclaiming something couldn’t be done,” Turner says. “Believe in big ideas because they are the only things that have ever changed the world. Step forward and aim to be part of solutions. This applies equally to business as it does to trying to make positive contributions to our communities and lives of customers.”
- Remember the Rotary’s Four-Way Test. The first business service organization Turner ever belonged to was the local chapter of Rotary Club International. When making business decisions, he strongly subscribes to the ideals of Rotary’s Four-Way Test: 1. Is it the truth? 2. Is it fair to all concerned? 3. Will it build goodwill and better friendships? 4. Will it be beneficial to all concerned? Through the United Nations Foundation that he founded, Turner is working with Rotary to eradicate polio and reduce the incidence of malaria in developing countries.
- Seek scale. Everything starts small, but real accomplishment comes from operating at scale. Turner became a billionaire by figuring out how to make cable television available in every living room and office in America. But he also knew that giving customers original distinctive content is what would complete the sale. He’s taken the same premise and applied it to land stewardship and humanitarian causes. With two million acres, he is the second largest landowner in the U.S. His herd of bison, some 55,000 animals strong, is the largest ever owned by a single individual in history. Bison are being used as “ecological tools” in healing marred landscapes. Innovatively, as part of his pasture-to-plate initiative, Turner is at the forefront of promoting the health benefits of eating bison.
- “Eat great. Do good.” Diners at Ted’s Montana Grill restaurants across the country are greeted with this motto, which dovetails with the business approach to the Triple Bottom Line (see below). Customers are courted and praised as partners for insisting on having a healthier diet, reflecting on where their food comes from, and doing their part in generating less waste and protecting the natural world. At all the eateries, replicas of priceless 19th century romantic landscape paintings (the originals of which are owned by Turner) are featured and used to promote a vision of what healthy landscapes look like.
- “I was cable before cable was cool.” Companies that chase what’s popular in the moment are destined to always be behind the curve, Turner says. Trends are set by anticipating what customers want but, more importantly, what they need. The premise also applies to companies when they endeavor to think and act green. Turner and business partner George McKerrow have been major catalysts in helping the one-million-member strong National Restaurant Association refine its thinking about sustainability. In their own operation, Turner and McKerrow have realized millions of dollars in cost savings by embracing efficiency in energy, water use, and waste. As Turner says, “Doing what’s right by the environment delivers dividends.” Which brings us to the next point:
- The value of the triple bottom line. This is a socially conscious accounting system based on the premise of a three-legged stool. The first delivers profit, the second ensures that products are made in a way that does no harm to the environment, and the third has a human dimension: treating your employees right and investing in the local community where profit is made. “Our business lives should make us feel better at the end of the day,” Turner says. “If we strive to leave the world a little better off than how we found it, every one of us can make a difference.”