Oct 8, 2009

3 Signals: Why The Future of Advertising is Digital Direct Marketing

There are three signals which will change the advertising industry forever. I'm sorry to break this news to all ad agency creatives: The future's pay day for advertising professional will only come from results. Goofing around with clients' money is over.

Whose fault?

The internet came and made everything measurable. Today, ideas are still very much in demand, but now your ideas have to also ring a cash register. Your job is to prove why your advertising and marketing efforts work. Can you do that?

Signal 1: Direct-response advertising is back

Direct-response has transformed to Digital Direct Marketing. The Digital Direct Marketing combines old proven direct-response advertising techniques with new social media tools. Digital Direct Marketing allows you to have a real conversation with your customer. The conversation with a goal: to make a sale for you. For the advertiser the sales speech and the conversation can be made automatic. For the customer it is highly personalized interaction which leads to the purchase.

Forbes.com calls this future "revenge of the nerds". Ogilvy, one of the largest advertising agencies in the world, is leading the advertising industry to measure and understand online data. I personally consider Ogilvy to become one of the greatest winners of this new information era. They have always been consistent with their work to create advertising that sells. And they have gone great lengths to prove it too, even as early as in the 1960's. Now that hard work from testing and re-testing direct marketing techniques pays off. T
oday, the direct marketing field, on what almost all creatives have despised, is becoming the center of the digital revolution. Hooray!

Signal 2: Traditional creative ad agencies are trying to catch up

A French advertising giant Publicis acquired digital marketing agency called Razorfish from Microsoft. Why would something as conservative company as Publicis do something like this? At first it didn't seem to fit into picture at all. Unless there is a change coming. A quickly after the acquisition they announced their ambition to lead the future change of advertising.

Signal 3: Coca-Cola is open about their new Value-Based Compensation (VBC) for ad agencies

Here is an interesting article from 4A's Business Development Blog. It summarizes what kind of a compensation model Coke is trying to make as the industry standard for all agencies and advertisers. They are currently testing it and are hoping to roll out the Value-Based Compensation model around the globe within few years. How long do you think that other companies will continue as spectators?

The future of advertising in brief

1. The comeback of direct-response adverting as the digital direct marketing. Geeks are hired to ad business. An automated sales process.

2. Followers are trying to become leaders. Publicis acquires Razorfish.

3. Ad agencies will get paid only from delivering measurable results. Coca-Cola shares its plans openly about their Value-Based Compensation for ad agencies.

My conclusion: If you can't measure it, it doesn't exist.

A question: What do you think? Is this a good or a bad thing?

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