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Why CMO's don't understand Digital Advertising?
Why CMO's don't understand Digital Advertising?
By: Vivek Bhargava

All CMO comments in this article are fictional, if they resemble you or someone you know, it is purely co-incidental :)

“We have finally cracked the creative! It reaches the heart of our core TG, it is clutter breaking, our TV commercial is going to win the cannes, I now want you to translate this creative into Digital and paste it all over top three portals, news sites, financial sites,Youtube and run search advertising for the same – you’d be ecstatic, I have 50 lakhs for you as pure digital branding budget!” exclaimed the excited CMO. My gut wrenched, my heart started beating faster, I was about to do something that no Digital guy in India had done before – I said “NO” – he said, what?? !, I repeated –  “NO – I am sorry I just can’t do this anymore, I am no longer the 24 year boy who has helped you perform Harakiri by touching the knife with my little finger and served sentence for murder”. “I don’t understand, you have always asked for branding budgets on Digital, finally I give a 50 lakhs budget and you are being melodramatic, looks like your success has gone to your head, you know my conventional media agency now has people who know Digital”.

I knew this was not going to be easy, however I was at the point of no return, remembered the instructions of my paragliding instructor – when you are on the edge of the hill, all you have to do is a committed run.

I took a deep breath – “ It is not about the budget, I would be happy if you’d give me half the amount, but give me the flexibility of the running the digital branding campaign the way it should be run, not replicate your conventional mediastrategy” – it is 2 % of your total budget, I promise it will be spent wisely, it would be measured much more than your TV and outdoor, ek chance do nah? “He took a long pause, and said…… “

India has 100 million plus Internet users who probably control most of India’s disposable income, however Digital Advertising enjoys less than 2 % of the total advertising pie of India. I believe that they are two reasons for the same, CMO’s believe that Digital cannot be used for branding, the one’s that do, most replicate their conventional strategy and fail thus re-enforcing the first belief.  I am not comparing the efficacy of one medium against the other, all I am trying to communicate is that approach required for each medium is radically different and it is critical that CMO’s understand while attempting branding through Digtial.

Let me describe how Digital approach to branding needs to be different from the approach followed on conventional media.

There is a no Sec A and B – Do you sell car insurance?  Who is your core target group. Age 25 to 45 male, urban,  Sec A ?  Think again! – as far as Digital is concerned, your core TG is anyone who owns a car. It does not matter whether the person is 48 years old, or for that matter “not male”, if they own a car, we must target them.  As conventional media is minimizing waste, one needs to group people together in order to target them. While digital is about maximizing efficiency, so one can target hundreds of groups simultaneously. Digital automatically distributes more budgets towards your core target groups, but it prevents you from ignoring the non-core group that still have the propensity to buy your products. Example – I recently talked to a global CMO of a company that sells hand wash soaps and sanitizers, their core TG is moms with small kids and tertiary audience is kids themselves. This strategy is fine for conventional media where one needs to group people due to inability of the medium, however in Digital one can target tens of Target Audience example – what about executives who travel, I carry a hand sanitizer in both my car and my laptop bag, comes in very handy. What if we can have a creative that says “spill proof sanitizer for your car, laptop and handbag” – and it is targeted only to people using wifi networks of hotels in India. (Yeah this kind of geo-targeting is possible).  What do you think kids do when the parent is using the sanitizer :).Will you be able to spend millions of dollars, NO! will it give you a ROI for the money you spent, most likely.

You don’t need laser focus positioning / creative– Most conventional media is interruption oriented, thus unless you deliver a single idea with tons of frequency, it is almost impossible register the brand with the prospect. Digital is more about understanding intent, context andis more permission based. Thus the creative needs to be attuned to the intent of the user rather than the positioning message that you have thought about your brand. Let me give you an example, what if a user is searching for “fuel efficiency Volvo s60” – do you still want to harp about the car’s safety features or would you prefer showing him a hybrid Volvo or how s60 is also great in fuel economy. Similarly what if the user is searching for “safety Ferrai430” – you get the point. One needs to tweak creative based on user intent. Example a person buying a Ferrari 430 knows it’s acceleration, probably a video on it’s safely specifications is what he needs to convince his wife :).  An engaged user interaction also reduces the frequency needed, he will not need to see the video 8 times in order to remember it is a still a safe car.

Sorry Mr. CMO, there is no Media plan – We get countless requests for a detailed media plan where every single dollar is going to be spent.  In conventional media one target a set demographic, the media planner creates an exact plan where every single dollar is going to be spent, this is essential cause once the campaign goes live, one cannot optimize it live. In Digital media one creates a strategy, then uses data to decide which part of the strategy is working and which isn’t and then constantly optimizes the campaign to maximize efficiency and ROI. Example – we have decided that we want to target people who want to remove Tattoos and our biggest target audience is women who are about to get married who suddenly find the ex-boyfriend’s name Tattoo less appealing.   (we work with a skin clinic :)). There are hundreds of ways and time to reach this target audience, Digital is about finding out what strategy is giving the best ROI and then allocating majority of the budget to that way. Example we were able to acquire a 5.2 crore single deposit for a bank by targeting keywords such as Berkshire Hathaway.  Digital is about having a compass in hand and constantly navigating to reach the destination in the shortest possible time rather than conventional media where one has to follow a precise map where even after one realizes that the bridge is broken, one is not given a choice of getting out of the car.

Don’t spend 94 % of your Digital budget on paid media –As conventional media is about following a precise map, all the skill is in preparing the map that will deliver maximum efficiency, thereafter everything is autopilot. Digital is about the skill of navigating the course on a minute to minute basis.  When one does digital, one need to invests in creating content, analytics, customize creative, technology, reporting and lastly using all this feeback to optimize constantly. We recommend clients that they must allocate only 60 % of their budget on paid media, the rest of the budget should be allocated to all the above activities. The biggest benefit of digital is that if 100 dollars gets you 100 clicks, when one spends $40 on content creation, the remaining $60 may still end up buying you the same 100 clicks. Unlike conventional media, content reduces cost of paid media on Digital.

I could go on… but “samazdar koh dhakka kafee hai “ :)

As I have said before, I am not questioning the efficacy of conventional media, I have just accepted that Full Page Newspaper Ads, Outdoor and IPL deliver efficient brand building. However I strongly believe that if one wants to use Digital for Brand building, the strategic approach to doing so must change. Hope CMOs accept this too.

If you wondering and waiting what the CMO said after the long pause… I have been patient 10 years, can’t believe 15 minutes is bothering you.

Vivek Bhargava is a Managing Director at Communicate 2. He is also attending the iMedia Brand Summit Goa http://bit.ly/kk339A. To know about him click here