• by Frank S. Foster , September 29, 2008

When I was younger, I attended military school.  Many will find the fact that I was kicked out of military school less than surprising.  But I did make some lasting friendships in the three-plus years I was there.  A former classmate of mine runs a multibillion-dollar division of a large conglomerate.  His group advertises heavily on television.  Last week he had a problem and asked me to attend an advertising planning event with a few of his key executives.  After a long presentation on brand strategy, media mix and tactical plans, the lights came up and everyone turned to me.

"We want our advertising agency to spend no less than 25% of advertising dollars on accountable media," the executive with brown hair announced. 

"Why?" I asked.

"So we can get a handle on return on investment, of course,"  an executive with blond hair quipped.

"We think we can move that number to 40% in three years," interjected a third executive -- whose name was Chip or Chet or Trip.

"Well, it seems like you've got all your bases covered," I said.

"But we have a problem," Chip quipped.

"What's that?"

"Television," all three announced in unison.

"So don't buy any," I said. This drew nervous laughter from the crowd, though they quickly realized there would be no rejoinder.  There was murmuring and several seconds of silence among the trio of executives.

"But television is essential to our communication strategy," exclaimed Chet.

"So you should buy television," I said, prompting further murmurs and hushed exchanges.

"You just said we shouldn't buy television.  That makes no sense," challenged the brown-haired executive, asserting his leadership within the trio.

"If you are focused on establishing your brand, your 25% or 40% ROI number makes no sense, either," I said.  "But that hasn't stopped you from building your entire media strategy around it."

 

The meeting went on for another two hours.  Eventually, the trio (even Trip) revealed a fairly good handle on how consumers related to their products.  But they had only the most rudimentary knowledge of how consumers use media, let alone how their target market interacted with television, the Internet or radio.  And that was the rub.  Advertising is all about connecting with potential clients.  If you don't know anything about your target's relationship with media, your knowledge of your target's relationship with your products cannot be fully exploited.  Setting artificial hurdles is not helpful, especially if those hurdles are gleaned from a book without insight to their purpose or intent.

 

This particular company has three goals for successful brand advertising:

1.       To help consumers uncover specific, unmet needs;

2.       To create awareness of a product or market segment; and ultimately

3.       To establish a preference for their product or service. 

 

For many brand advertisers, television is a wonderful tool.  It is immersive, lifelike and persuasive.  Television penetrates almost every home, many restaurants, airports and hotels.  Perhaps most importantly of all, television can provide tremendous reach.  Television is what it is ... and cost effective it often is not.  Return on investment and accountability measurements are not the panacea to all advertising problems -- they are metrics, that when employed wisely help media people make better decisions. 

 

My former classmate is a great businessperson.  He saw the errors his people were making and used an outsider to deliver the message.  Not every company has such an insightful leader, and fewer understand their clients as well.  The executives I met with were smart, well-educated and motivated to excel, but they relied more on their MBA than their knowledge of media.  Business school is a great experience and can provide a baseline understanding of many complicated business issues.  But it is knowing when and when not to apply certain practices that separate average businesspeople from great ones.  With the economy moving in the direction it appears to be moving, more companies are going to entertain ROI conversations, at least internally.  May the advertising agency and media planner communities be warned.