© 2018 by M.i. Media

Google Partner.png
LW_logo_london_rgb.jpg
  • Admin

Hoxton, we've got a problem!

Updated: Aug 28, 2019

Written by Andy Brander


M.i. Media’s Andy Brander discusses advertising effectiveness in a constantly shifting media universe.



I wouldn't describe advertising as a giant leap for mankind but, at its best, it can help make small steps of growth and progress. However, stratospheric amounts of money are being spent on advertising that is not having the intended impact... as WARC’s Anatomy of Effectiveness points out, “there is a sense that advertising in its current forms is not driving the growth it should be”.


Worryingly for the ad folk of Hoxton (and Soho, Old Street and beyond), this decline in advertising effectiveness has a number of potential causes.


  • A focus on short-termism that according to Peter Field has halved the business impact of creativity (though without the short term there is no long term!).


  • Or Lumen Research finding that only 12% of supposedly “viewable” display ads are actually noticed by consumers.


  • Or Credos research revealing that consumer trust in advertising has hit a record low, leading the IPA’s Paul Bainsfair to conclude that “favourability towards advertising is on the wane".


These are all (dark) matters for the marketing industry to grapple with, yet there is another threat on the horizon whose potential gravity demands attention, that of diminishing media reach.


WARC describes reach as “the foundation of media effectiveness”. Numerous marketing rocket scientists, from Byron Sharp to Binet & Field, have demonstrated that advertising success correlates strongly with a brand’s paid for media reach. However, due to the fragmentation of audiences, this reach is getting harder to build. If advertisers are not careful rather than "reach for the sky" they'll get sky-high inflation.


Let's look at TV, widely recognised as the most effective media channel by the likes of Ebiquity & Gain Theory, but its ability to build mass coverage fast is diminishing. Ofcom’s just released 2019 Communications Market Report shows ITV’s all individual weekly reach for instance has declined from 68% to 54% from 2010-2018 and from 53% to now just 34% vs 16-24s. Other terrestrial or satellite broadcasters fare no better.


Thinkbox argue that the loss of linear TV's reach can be mitigated by advertising on Broadcaster VOD platforms. They are right, in part it can, but normally at a higher marginal cost so advertisers need to make sure the blend is spot on and targeting as smart as the technologies allow.


The small but increasing % of viewing of ad-free Subscription VOD meanwhile (Netflix and Amazon Prime etc now in 40%+ of homes), is currently disappearing into a black hole as far as advertisers are concerned.


Switch media budget to radio or posters then? Commercial radio’s reach has certainly held up well despite competition from the popularity of streaming services and podcasts, but Global radio is now investing millions looking for growth elsewhere.


Out Of Home has been the beneficiary, experiencing revenue growth on the back of the industry’s drive to digital formats. Working with the right specialists, empowered with the right data, out of home advertisers can now leverage the potential of precision targeting at broadcast scale. But the ongoing digitisation of conventional paper and paste sites has the potential to drive significant cost inflation, eroding the reach poster advertisers can afford.


The decline of press is well documented; few would argue that the Sun’s print coverage (and influence) is but a fraction of its former self. And though digital publishers, ad networks and social media offer expanding universes to target, generally speaking, these tend to perform better towards the bottom of the purchase funnel, harvesting demand rather than the creation of it.


In conclusion, ad effectiveness seems likely to come under further pressure if the reach of individual media channels continues to decline and if the costs of building cross-media coverage are allowed to be pushed higher.


While there is no single silver bullet, advertisers can make sure that their media is expertly planned and bought to mitigate against coverage loss efficiently or else risk burning a lot more fuel to get campaigns launched and messages landed effectively.


Advertisers who want objective advice on how to get the most from their paid for media time and space, why not come into M.i. Media's orbit? We'll be over the moon to help!