We all relate to prices going up. It seriously pisses us off. Then when reading about the cost of advertising in the last episode of Breaking Bad in the United States (more about that later), it suddenly struck me: the marketing world is gatvol of the price it has to pay for promoting a product. We’re seeing more and more clients trying to ascertain their return on investment (ROI) on media spend, quantify it and justify it. We know that when their boards of directors meet the first thing to be slashed when times are tough is the advertising spend. Surely we should learn from that?
I want to look at the area of advertising cost, value, ROI, and then the digital space. But first let me get something off my chest. It is clear that most successful companies are led by financial guys for a host of good reasons, but there is a downside in this for the media. These guys deal in realities, facts and black-and-white – no grey areas. And therefore they want to know what works best. How many tins of beans did they sell ‘because of advert A in medium A versus advert B in medium B’.
And they think I’m stupid when I tell them I don’t know the answer. Yes, I’ve seen all the regression analysis, modelling and algorithmic mumbo jumbo. The simple fact is that there are just too many variables outside of media cost per point/cost per thousand (CPP/CPT) and any model telling you when to do what and which vary from campaign to campaign.
I believe that the price of the product, the competitive offerings and activities, the packaging and distribution, the promotion and the advertising throw any media modelling down the lavatory. Yes, already I hear howls of protest. But if it works then why isn’t every company in South Africa applying the magic formula to media selection for maximum ROI? Hell, wave the magic wand, programme the computer and away we go. Nope, it’s never going to be that simple, but I understand why we want it to be: money, cost, billions poured into media in the hope of a return. No wonder we get reactions like: “And we can’t quantify it? Bizarre. Cut the budget!”
But let us quantify just some of these spends with (usually) unquantifiable returns. At the top end, advertisers were asked for $400 000 for a 30-second ad during Breaking Bad. Sure, it pales in comparison to the Super Bowl, priced at $4 million for 30 seconds. And I understand Super Bowl audiences can reach
100 million people. Maybe it is valued at only four cents per viewer, I don’t know. But it sure is a massive cheque to write out for something on which the return is not really quantifiable.
Yes, you can measure public reaction, but what if it reads like this? Go Daddy, primarily an internet domain registrar, bought a Super Bowl spot in 2013 featuring a sexy woman and an overweight geek smooching, making the point that together you get the best assets in building domains. Reaction? American consumers described it as “gross,” “uncomfortable” and “disgusting”. One consumer said, “What are you selling? Fire your marketing team! You are wasting time and money on them.” This ad, in spite of its high attention scores, was the second-lowest ad of the Super Bowl when measured on creative attributes such as persuasion, relevance, information, attention, change, desire and watchability. Goodbye $4million!
Even locally, price must be biting. R70 000 buys you a spot during ‘Carte Blanche’ – which, by the way, is sold out every week. Marketers and agencies love it. Now, I don’t know if the adverts flighted here deliver a great ROI, given all the extraneous factors that can have an influence. What I do know is that it’s an extraordinary amount of money to pay for a commercial that won’t reach 99% of South Africans with any real disposable income (LSM 4-10). It has a delivery of as low as 0.9% of the population. R70 000. Sold out. Really? But let’s not pick on ‘Carte Blanche’. Justifying a spread in the Sunday Times at R1.1 million or a spot on 94.7 Highveld Stereo Breakfast Express at R20 000 – both equally popular – could be just as tricky when faced with accountants’ depreciation.
So no wonder social media has been welcomed with open arms. Retweet, like, share, and I’m likely to start getting massive consumer-generated content with smart offers, coupon sharing and innovation, all of which are ultimately measurable. Hell, today you have to leverage all other communication to the hilt to make the value increase. Here’s an example. We spoke about $4 millon for the Super Bowl. Well, talk about free? A Budweiser Super Bowl 2013 ad was viewed over 10 million times on YouTube, for free. That’s the same audience as ‘Breaking Bad’ got for its last episode – and they charged $400 000!
And to think that a whack of clients out there still throw only one or two percent of their budget at digital as an afterthought. Crazy…
This story was first published in the December 2013 issue of The Media magazine.
IMAGE: Breaking Bad / Wikimedia Creative Commons
Want to continue this conversation on The Media Online platforms? Comment on Twitter @MediaTMO or on our Facebook page. Send us your suggestions, comments, contributions or tip-offs via e-mail to email@example.com or firstname.lastname@example.org