CFO World

Marketers debate how transparent digital marketing practices raise risk of short-term thinking

Marketing leaders from Nude by Nature, Trafalgar Tours, Vision Critical and The Hallway debate the programmatic's impact on creativity, risk-taking and the marketing budget

Marketers wholly subscribing to a metrics-based, programmatic digital marketing approach could be risking brand growth through short-term thinking and optimisation overkill, The Hallway’s Jules Hall claims.

Speaking at ADMA’s Digital Town Hall event in Sydney yesterday, the agency’s founder and CEO said marketers need to straddle the line between optimisation and creative thinking as programmatic and digital become dominant ways of engaging with consumers.

“If you keep harvesting and don’t build brand positioning in people’s minds, you run out of people to harvest,” he told attendees. “We’ve seen clients do that and we’ve had to dig them out of that situation.”

Within creative agencies, Hall said there’s also a view that programmatic is killing creativity. However, he argued programmatic opens up enormous opportunities for creativity – just of a different kind.

“In this ecosystem and world we’re operating within, we need system thinking: You need lots different executions that can be as tailored to the individual and consumer at different points in their journey as possible, but those executions still need to be tied to a singular, core idea,” he said.

“You need an idea that can tolerate lots of executions so you’re not seeing schizophrenic, isolated messages from a brand. Every message needs to build on that brand experience and story you’re trying to establish in the hearts and minds of consumers.

“What programmatic offers is a way to deliver on that and create more interesting, dynamic communications.”

To do this, the creative process needs a major overhaul. “It requires macro thinkers, but also micro thinking, and being able to think down to details, nuances and form factor. And you need to move very quickly,” Hall said.

As an example, he noted a campaign The Hallway undertook for Google, which encompassed 1100 executions in market over a nine-month period. “To do that, we had daily standups and approval processes,” he said. “You are thinking and operating with a very different rhythm.”

Australian natural cosmetics brand, Nude by Nature, started investing in in-house programmatic capabilities in order to more dynamically target creative. Its head of digital, Gavin Merriman, said the decision was prompted by a desire to do cross-channel personalisation and improve retargeting efforts.

“If we wanted to send a replenishment email to someone, we know they’ve bought product, and we’ll send it two months later after they purchased as they’re ready to buy another. But email is limited, and we wanted to push out to that same segment on Facebook, display and other areas,” he explained. “You can’t do that with traditional programmatic services, as they don’t take feeds from DMPs and you can’t adapt creative to show a single product or message.

“That drove us to look at an alternative way to do it and take back some control in-house for creative and messaging in display, as well as the website and through email.”

Trafalgar Tours head of marketing, Narelle Riley, said its parent company, Travel Corporation, is also bringing digital media capability in-house globally after US testing showed more effective media results. But she admitted to some concern marketers could “kill the magic” with too much rationality around creative.

“What can bring that back is bringing things back to the consumer and the values and what they’re looking for. They’re not just online either, it’s multi-channel,” she said. “The challenge for us as we become more fragmented in this media world is how to track across channel and see a brand, not just in one way, but in a number of different ways, then learn from that.

“It’s like the old days – we need to deliver the right message at the right time – it’s just it’s got more complicated to analyse it.”

Up next: How marketers are tackling the need for flexibility in marketing budgets

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Tackling the marketing budgeting challenge

What the programmatic discussion also highlighted was the wider challenge marketers are facing to balance short-term results with long-term brand positioning in the face of more transparent media buying and measurement. This, in turn, is impacting how marketers manage the modern marketing budget.

The latest CMO of Tomorrow research produced by ADMA and Oracle Marketing Cloud showed access to budget as the number one challenge to accelerating digital marketing efforts and innovation.

Riley said 50-page marketing plans have been abandoned in favour of short-form and more flexible strategies. “CEOs just want to see what the bottom-line is, what the opportunities are and head towards that quickly,” she said.

“We’re delivering these plans in short order form but in the same strategic way we would have in the past. This means starting with your audience, insights and opportunity, objectives, what you’re trying to achieve, the integrated marketing plan for that, if it’s more digital and what the activity is then putting that forward.”

What has happened over the last few years is that budgets have then been recut up to 10 times throughout the year, Riley continued. This is forcing marketing to be more agile.

“You need to keep one eye on the long game, but be very clear on the short-term piece as well,” she said. “It’s silly to design a plan just for long term as it takes too long for an integrated campaign to come to life, I really needed to that in a smart, effective way today, then stage two for tomorrow, and so on. If I have to adapt, shorten or enlarge it, it gives me flexibility and nothing has fallen over in the meantime.”

Vision Critical head of marketing, Brittany Wong, said her team knew by May that its annual plan of activities wasn’t going to live up to expectations.

“But we had a plan and needed to execute against it, and to be agile,” she said. “We’re now planning in two-week sprints, with monthly activities, and we’re using SiriusDecisions templates so we can engage on the one-page plan, and focus on objectives and key results.

“Priorities and goals don’t change but the activities change.”

During his time at Shopdirect in the UK, Merriman said the team circumvented an arduous approval process with a $2 million innovation budget. “This meant we could move quickly, and from that we launched our apps, content studio, personalisation engine and it paid dividends,” he said.

Merriman also advocated proof-of-concept as a way to encourage innovation. “If you can put together a smaller amount of investment for a proof-of-concept, that’s a way to minimise risk,” he said. “It’s not often people say no to a proof-of-concept.”

But Hall argued the wider industry has missed the point around marketing ROI.

“The commercial conversations happening in companies are about driving shareholder returns and growth, yet we get distracted by clickthrough rates and attribution,” he said. “We’re not making the link back to what drives growth and shareholder returns. That’s the thing we as an industry need to get an awful lot better at.”

If used correctly, data gives marketers permission to be more innovative, Hall said. “If you use data as a reason to innovative and try different things, it can create a toolset for justifying taking risks,” he added.

At Vision Critical, Wong said marketing runs all new pipeline of up to 10 per cent, giving the team tangible proof of the opportunities it drives. The piece missing is customer retention and long-term metrics.

“Though marketing is a massive part of the revenue quest, that other piece is critical in building customer lifetime value,” she said. “We have to find a way to prove that value and show these metrics matter.”

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