Counterfeiting the Currency of Advertising

This is a corollary to yesterday’s post about research which found that three out of four people believe claims found in advertising are exaggerated.

Words and images are the currency of advertising. The U.S. Government won’t let people counterfeit its currency. But advertising industry professionals seem to have no problem counterfeiting theirs.

When industry professionals exaggerate, make false claims, or misrepresent the capabilities of a product or service, they don’t serve their clients’ best interests or their own.

False advertising may get people to purchase a product or service once. But the inevitable disappointment they feel can ruin the client’s reputation. The purchasers not only feel disappointed in the performance of the product or service, they feel they have been lied to. Trust is lost with the relationship.

False claims and impressions also counterfeit the currency of the industry. They undermine the industry’s credibility and the return that honest advertisers hope to gain from their investment in advertising.

Governments won’t let people counterfeit their currencies. Why do ad industry trade groups not raise a bigger stink about people who devalue their currency?

Credibility of Advertising

More than three in four consumers say most of the claims that brands make in advertisements are exaggerated, according to a study by Lab42.

Specifically, among surveyed consumers, 57.4% say advertising claims are “somewhat exaggerated,” and 19.0% say they are “very exaggerated,” Lab42 reported.

Only 2.8% of consumers surveyed say the claims in various ads are very accurate. For the full report, click here.

How did we come to this sad, sorry state of affairs? How did a whole industry undermine its own credibility without raising alarms? Here’s my personal take. The advertising industry I joined as a young man (at Leo Burnett in Chicago in 1972) was much different than the industry today. It seemed every commercial I wrote was scrupulously reviewed by agency lawyers, industry associations, and government regulators. Likewise, research ruled.

Commercials were tested, refined and retested in animatic form before production. Then commercials were tested again in finished form after production. Commercials were more trusted then and felt more compelling. They worked. Even clients believed … in the process.

Then during the Eighties, creatives revolted. They felt straight-jacketed.  They argued that:

  • Research forced everything into the same expected mold.
  • Lawyers sapped the fun out of commercials.
  • Advertising was failing to differentiate brands and make them stand out.
  • People didn’t watch TV to look at the ads; they watched it to be entertained.
  • Advertising needed to be more entertaining to succeed.

At that point, the race for eyeballs had begun. The creative development process was more about eye-candy. Writers and art directors argued that if people weren’t watching, there was no way the commercial could succeed. Of course, they were right.

But that logic contained several fatal flaws:

  • It assumed that people weren’t attending to commercials.
  • Gaining attention is only the first battle for customers’ hearts.
  • Unless advertising also manages to convert that awareness into interest and preference, it has failed.

While the Nineties were certainly a fun period to be in advertising, the industry was sowing the seeds of its own destruction. The eye-candy theorists failed to realize the devastation that unregulated, unpersuasive advertising would wreak on the industry.

Today, that eye-candy leaves many with a bad aftertaste. Perhaps it’s time for the pendulum to begin switching back. Better yet, perhaps it’s time for agencies to evolve to a higher level and to understand some basic truths.

In many cases, advertising makes people aware, but fails to gain interest. Therefore, prospects don’t seriously consider the client’s product or service. Said another way,  prospects don’t put the client on their shopping lists.

The process looks like this. Information needs increase at every level.

  1. Before people will purchase a brand, they must prefer it.
  2. Before people will prefer a brand, they must be interested enough in it to put it on their shopping lists and explore it further.
  3. Before people will be interested in a brand, they must be aware of it.

The battle for dollars takes place on four levels, not just one. Awareness, interest and preference come before purchase. Overlooking any of those steps is fatal to a sale.

And trust is essential to every single one of them. If people don’t trust you, they won’t do business with you. People don’t buy from advertising they don’t trust, and they certainly won’t buy from companies they don’t trust. Exaggeration for the sake of eyeballs does not serve clients well.

 

The Future of Digital Media: Implications for Responsive Design

BI Intelligence is a new research and analysis service focused on mobile computing and the Internet.

This massive, data-driven slide deck shows trends in device usage, advertising revenue, internet searching and more by market.

Some key findings, as I see them, for the business-to-business sector:

  • As PC sales stalled in 2012, sales of mobile devices, such as tablets and smartphones, soared.
  • Americans now spend more time on social networks than portals.
  • But social site referrals to commerce sites are tiny, about 1% for Facebook.
  • Google drives 80% of traffic to e-commerce sites.
  • As mobile usage increases, time spent with all other media is decreasing.
  • Google owns mobile search with approximately 95% market share.
  • Digital is turning into a four screen world: desktop, laptop, tablet and smartphone.

I concluded after reviewing this entire deck that most businesses can no longer rely on web sites optimized only for desktop computers. Sites that do will simply not be useable on tablets and smartphones. Companies must either refer prospects to sites optimized for mobile devices or develop sites that dynamically reformat themselves depending on the access device.

The second option is known as responsive design. While responsive design programming is far more complicated (i.e., about a third more expensive than conventional), it pays off in the long run. Major benefits include improved site usability on a wider variety of devices and reduced maintenance costs.  Instead of supporting/updating three or four sites, you update one.

Google now estimates that 50% of all Internet searches will take place from mobile devices by 2015. That will make responsive web design the wave of the future. I’ll discuss that in greater detail in future posts.

Read the entire Business Intelligence report.

How Social Media Impacts Brand Marketing: The Value of References

Source: nielsen.com.
New research by NM Incite helps uncover what impacts social media may have for marketers trying to build their brands and connect with their audience more directly.

Consumers are spending more time than ever using social media, as demonstrated in the Social Media Report recently published by Nielsen and NM Incite, a Nielsen/McKinsey company. Building on this report, research by NM Incite helps uncover what impacts social media may have for marketers trying to build their brands and connect with their audience more directly.

Social media plays an important role in how consumers discover, research, and share information about brands and products. In fact, 60 percent of consumers researching products through multiple online sources learned about a specific brand or retailer through social networking sites. Active social media users are more likely to read product reviews online, and 3 out of 5 create their own reviews of products and services. Women are more likely than men to tell others about products that they like (81% of females vs. 72% of males). Overall, consumer-generated reviews and product ratings are the most preferred sources of product information among social media users.

Preferred sources of brand information

Research shows that social media is increasingly a platform consumers use to express their loyalty to their favorite brands and products, and many seek to reap benefits from brands for helping promote their products. Among those who share their brand experiences through social media, at least 41 percent say they do so to receive discounts. When researching products, social media users are likely to trust the recommendations of their friends and family most, and results from Nielsen’s Global Online Survey indicate that 2 out of 3 respondents said they were either highly or somewhat influenced by advertising with a social context.

Social Media also plays a key role in protecting brands: 58 percent of social media users say they write product reviews to protect others from bad experiences, and nearly 1 in 4 say they share their negative experiences to “punish companies”. Many customers also use social media to engage with brands on a customer service level, with 42 percent of 18- to 34-year-olds acknowledging that they expect customer support within 12 hours of a complaint.

Why consumers share their company experiences

Research dated October 14, 2011. For the full report: http://blog.nielsen.com/nielsenwire/consumer/how-social-media-impacts-brand-marketing/

My personal take: the value of social media in a marketing program is “references.” Other research I have seen (see post on Future of Digital Media & Responsive Design) indicates that click-throughs from conventional banner ads are not the primary value.