Is the ad business out of touch?

Discussion
Oct 26, 2015

Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research’s weekly analysis on emerging issues facing retailers, presented here for discussion.

At the Association of National Advertisers annual "Masters of Marketing" conference, Pepsico exec Brad Jakeman gave a barn-burning speech, charging the ad industry is out of touch with the globalization, digitalization and democratization of its audience.

As reported by Advertising Age, here’s a list of his points:

  1. He really, really hates "pre roll" advertising
  2. Measurement models are outdated
  3. The ad industry lacks diversity
  4. The phrase digital marketing should be dumped

digital marketing problems

Let’s take a look at each.

Pre-roll advertising: Pre roll advertising is those annoying TV-like ads you are forced to watch when you go to YouTube to see a video you like…or the advertising that pops up when you’re trying to make your move in "Words With Friends." Does anyone EVER listen to or watch those videos? You know the answer. As Mr. Jakeman described, it’s a "model for polluting content."

Measurement models are outdated: In our benchmark report "Retail Marketing 2014: On The Digital Road" released last fall we found measurements were muddled or non-existent for digital marketing. Maybe it’s time to take a holistic view of marketing, put all divisions under one roof, and take some time to determine new success metrics in a global, digital world.

The ad industry lacks diversity: Mr. Jakeman said, "I am sick and tired as a client of sitting in agency meetings with a whole bunch of white straight males talking to me about how we are going to sell our brands that are bought 85 percent by women. Innovation and disruption does not come from homogeneous groups of people." Boom! Here’s one thing I know from living in Miami. The level of micro-marketing needed just to market to the group called "Hispanics" is completely absent in national advertising.

The phrase digital marketing should be dumped: The over-arching theme of our marketing benchmark was that measurements and understanding of digital marketing were confused at best, absent at worst. Perhaps that’s because it’s an artificial distinction. In fact, isn’t TV a digital medium? Hasn’t the news business gone digital?

It’s time to take a fresh look at marketing. That message was loud and clear at the conference. The more I see of how marketing is working, the more presumptions and assumptions come clear. "Baby Boomers" are considered a homogeneous group who are very different from Millennials (the new Holy Grail). In fact, neither is true. I probably have more in common with some Millennials than I do with some of my Boomer brethren. I could list some of those presumptions and assumptions here, but I won’t.

I hope retail marketers listen carefully to the message delivered at the ANA. It’s time to change.

In what ways is the ad industry out of touch with the way society is changing? Which of the points mentioned by Brad Jakeman do you particularly agree or disagree with?

Braintrust
"Consumer habits are changing faster than the ad industry can adjust. There are no Holy Grails in advertising any more. This makes the job of a marketer more difficult than ever."
"Adapt or die. Digital ad campaigns need to be interactive and engaging, not obstructionist (as they are on YouTube). And while digital ads need to improve, keep in mind that our industry still relies on newspaper advertising and Sunday circulars."

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9 Comments on "Is the ad business out of touch?"


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Max Goldberg
Guest
2 years 3 months ago

Consumer habits are changing faster than the ad industry can adjust to the changes. There are no Holy Grails in advertising any more. This makes the job of a marketer more difficult than ever. It’s easy to criticize current ad norms, but what do critics like Mr. Jakeman offer in place of the status quo?

Phil Rubin
Guest
2 years 3 months ago

This is a great piece yet Mr. Jakeman’s issues only scratch the surface with how out of touch the industry is. Measurement is probably the top issue as it’s always been advertising’s dirty secrets that the metrics were flimsy and the media has generally tried to keep things that way.

What about the customer? Totally missing from most of his rant. Brands’ advertising is increasingly irrelevant (in fairness, Mr. Jakeman calls this out relative to Hispanics) which is why the industry is in nearly complete denial about the threat from ad blockers in tandem with fraud.

Steve Montgomery
Guest
2 years 3 months ago

Mr. Jakeman raised some great questions and/or issues. Unfortunately he did not offer any solutions other than getting rid of the word digital. Not sure doing so would result in any significant changes inside ad agencies or companies. However it might result in more consistent messaging.

Gene Detroyer
Guest
2 years 3 months ago
Other than the diversity issue, the other three points are right on. Back in the late ’80s, I started a company that put silent advertising on monitors above the aisles in supermarkets. We researched the results of over 50 products. In every case, there was a significant lift in the test stores versus the control stores. (Of further interest; there was also a lift by the competitor products, though never as much as the advertised product.) So we brought our results to advertising agencies. They didn’t like them. They wanted to measure awareness, memorability, desire to buy (that was a strange one, since the people already bought). So we stopped going to advertising agencies and went right to the client. But even there we were shown the way to the promotion department. There is another great story on Bloomberg’s Game Changers show about the Google guys. It tells how the head of one of the big networks came to Google and complained that Google’s ability to only charge for ads that worked would upend the… Read more »
Cathy Hotka
Guest
2 years 3 months ago

Adapt or die. Digital ad campaigns need to be interactive and engaging, not obstructionist (as they are on YouTube). And while digital ads need to improve, keep in mind that our industry still relies on newspaper advertising and Sunday circulars. We need to give consumers a reason to want ad content.

Doug Garnett
Guest
2 years 3 months ago

I think this is a bit backwards … The ad business has sold itself for the past 20 years with big declarations that consumers are dramatically changing. Yet what actually happened is there are some exciting new mediums but consumers haven’t changed. Yet the ad business walked away from things that work well in its skirt-chasing after the newest digital endeavors.

So is the ad business out of touch with consumers? Absolutely. But is that because we need an entirely new paradigm of marketing? Absolutely not. We need to stop becoming so enamored of the mythology of change and take a hard realistic look at the world — and PepsiCo would be a great place to start taking a far clearer look.

Much that was rejected because of the mythology of change is the solid and strong underpinning of marketing.

Gordon Arnold
Guest
2 years 3 months ago
It may have been better to offer solutions and recommendations along with the scathing remarks and reviews, but what’s done is done. When businesses look at the consumer interests and use of free time they are searching for large population attractions much like they have done in the past. It is worthwhile to note that in the past consumers had far fewer places to gather on the television and radio than they do today. What might be a better approach would be to search for opportunities to make those searching the internet aware of the solutions the company offers in a way that will meet their interest(s) in an enjoyable fashion. This is better built with animation using generic characters and leaving out endorsements. Placing an opportunity to dislike products or services from recommendations and support personnel that alienate the target makes no sense at all when it is cheaper to create and change characters freely to enroll as much consumer support as is possible. People looking for something on the internet will use favorites… Read more »
Frank Beurskens
Guest
2 years 3 months ago

All of the points brought up are accurate, which is the point being missed … The premise behind each of the questions is a remnant of the past, top down, from few to many, print and media network mindset. With unlimited “channels” and a device in every consumer’s control, advertising as a one-way delivery system is near retirement age. On the other hand, much of our consumer culture is based on capturing consumer “projections” onto products, both visually and through narrative. That seems to imply the future of advertising may be more in the hands of authors and artists rather than current carnival hawkers tripping one’s attention.

Brian Kelly
Guest
2 years 3 months ago

When was the ad biz NOT out of touch?

When I went from running stores to building a brand at an agency, I was stunned by the lack of desire to understand the challenges of the client. And it has changed — it has gotten worse!

Don’t lay this at the feet of the CMO, or its agency counterpart. The speed of change, another ANA topic, has the C-suite caught in a spin cycle of demand for constant innovation despite a requirement of doing more with less.

The lack of prioritization and retention of silos puts MARCOM at a real disadvantage as MARCOM within most retailers is an expense on a merchants and operators P&L. The MARCOM person is at the whim and whimsy of the tyranny of budgets.

Or as we like to also say, “retail MARCOM ain’t for sissies!”

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Braintrust
"Consumer habits are changing faster than the ad industry can adjust. There are no Holy Grails in advertising any more. This makes the job of a marketer more difficult than ever."
"Adapt or die. Digital ad campaigns need to be interactive and engaging, not obstructionist (as they are on YouTube). And while digital ads need to improve, keep in mind that our industry still relies on newspaper advertising and Sunday circulars."

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