Posted by Steve Schildwachter, SVP, Group Management Director, Draftfcb Chicago
Measurement and accountability are favorite topics of mine because they are the keys to the future of our business. Technology now permits us to know a lot more about the results of what we do.
Even so, it seems many executives don’t want to know the results. Perhaps they don’t trust the mysterious black box marketing mix analyses that impugned their efforts in the past. Perhaps the idea of understanding an algorithm (or even spelling the word) is intimidating or boring. Or maybe it’s just a lack of familiarity with the methods old and new we can all use to figure out what worked and what didn’t.
We’d all better get familiar fast. Even if we provide the smartest strategy and the greatest creative, it won’t mean much without analytics. As described in the short history of advertising, there are plenty of consultants who are willing to fill the void.
Fortunately the Draftfcb Model includes Customer Intelligence – the data analysts, or, as their leader says, the marketing geeks. On my business we are using them more and more – with great results.
The rest of the industry has caught on to these topics. Open any trade publication or business website and you’ll see a lot of interesting news and discussion. Here are just three examples plucked from the news last week alone.
1. It’s possible to measure TV advertising’s effect.
Let’s start with some fuzzy math. Or, in the words of Lucas Donat, “fuzzy analytics”. Donat wrote about a method of measuring TV advertising’s effect on sales. It’s very simple from a mathematical standpoint: establish a baseline that estimates what sales would be if you did not advertise for the time period in question. What’s the baseline? This is the fuzzy part. You are making a 21st Century dart throw, a guesstimate. But why not? You have to start somewhere. As Donat explains, you must attend to this model over time and learn its rhythms, constantly measuring your actual sales curve to understand the marketplace effect. Does this sound daunting? Ask Customer Intelligence for some perspective.
Years ago when I worked on McDonald’s we used this model to understand whether a promotion like Two Big Macs for $2 was driving a sufficient lift in transactions to justify the lower average check we expected from the discount. Step one was to establish a baseline. We treated these monthly case studies very seriously, and referred back to them for the planning of each new program. You’ve never known accountability, by the way, until you’ve explained store sales and profit to a committee of QSR franchisees.
2. The “secret weapon” should now be standard equipment.
Draftfcb resulted from the merger of an ad agency and the world’s premier direct marketing agency. I love the way my direct marketing colleagues think about measurement; it’s a product of decades measuring their work in direct marketing. Before the merger, direct marketing was something I only read about. For example, “Ogilvy on Advertising”, David Oglivy’s 1983 book, included a chapter titled “Direct mail, my first love and secret weapon”. It’s either quaint or prophetic that in just the third paragraph he mentions “computers” as a major advancement in the discipline.
3. Isn’t digital supposed to be measurable?
Recently, there was also an article about IRI, Dynamic Logic, ComScore and X+1 teaming up to offer a platform to analyze consumer purchase data and plan more effective online campaigns. Part of the news here is that they seek to tie purchase data to consumer segments such as loyalists and switchers. An intriguing example was the diagnosis of a packaged-goods brand campaign that attributed sales lift to incremental purchases by existing customers, as opposed to bringing in new buyers.
These are just three examples from one week in business journalism. There are thousands more.
Amidst all this activity, we offer something truly unique. We were the first major agency to elevate accountability to the same level as creativity. Customer Intelligence is critical to this effort.