Legend has it that John Wanamaker, the man who founded the first department store in 1876, once said “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.”
The new book, “What Sticks,” applies modern research techniques to Wanamaker’s dilemma and puts the waste at about 37 percent. Unfortunately, L.A.-based companies aren’t much better than the big brands from the East, according to several case studies presented in the book.
“Research proves that of the nearly $300 billion spent per year on advertising in the United States alone, as much as $112 billion is wasted,” wrote authors Rex Briggs and Greg Stuart, both veterans of Madison Ave. “There is a major competitive opportunity for those brands and marketers who make the leap to greater marketing certainty.”
The book, which went on sale Sept. 1, borrows from studies conducted for 30 top consumer brands that collectively spent $1 billion on advertising. The authors compare today’s challenge of connecting with consumers to a NASA project managed by Pasadena-based Jet Propulsion Laboratory. Thanks to its numbers-based methodology, JPL successfully sent a spacecraft 83 million miles to intersect the path of a comet.
To help marketers avoid waste, the authors suggest a 4-M approach Motivation, Message, Media and Maximization with most problems occurring with motivation. For example, the producers of a TV poker tournament skipped the motivation part and went straight to the fun of “creative messaging.” The tournament had a multimillion dollar jackpot, so they figured that big number would attract viewers. All the show’s promos hyped the size of the pot.
But research later showed viewers were more interested in learning specific game strategies for winning at poker, not watching someone else land a fortune. A wrong first step crippled all subsequent execution.
Another case study from the L.A. media economy illustrates the danger of segmented audiences. When Warner Bros Entertainment Inc. released the film “Constantine” in 2005, it had two marketing weapons: star Keanu Reeves’ appeal to women, and the draw of the comic book source material for young men. Marketers could sell the film as a tough romance or an action-adventure pic but not both.
The audience-segment decision would determine the entire campaign, from copy to imagery to media plan. Warner finally decided to communicate the story’s supernatural adventure aspects, and it worked. “The movie wasn’t a runaway blockbuster, but its opening weekend was $34.5 million, which is not bad at all,” the authors stated.
Creative types in ad agencies love the messaging step, despite research showing that most consumers experience ads in low-attention mode. As a result, messages must be simple and clear. A spot for ESPN, a unit of Walt Disney Co., showed a man’s serious face, the words “You’re playing poker. They’re playing you,” followed by the title “Tilt” and the ESPN logo. Consumers correctly deduced that “Tilt” was the name of a TV show, but they had little idea about its content.
The book, however, holds out some hope for marketing executives, noting that there is a wide breadth of Nielsen, financial and other data they can mine to help determine the effectiveness of their campaigns.
For example, when Los Angeles-based Universal Studios Home Entertainment Inc. launched the film “ET” on DVD, they put a few online ads in “rich media format,” making the ads essentially short online videos. Research proved the expensive rich-media ads were five times more effective than regular banners ads, making them much cheaper from a return on investment perspective.
In the end the authors argue that marketers should justify their decisions by the numbers simply because the job won’t get easier anytime soon. The average tenure for a chief marketing officer is only 22.9 months, shorter than the typical chief executive. The book speculates that in the future, corporate boards may hold marketers accountable the same way Congress grills NASA contractors at committee hearings.
News & Notes
The National Association of Manufacturers has launched a radio program called “America’s Business” with host Mike Hambrick. According to NAM President John Engler, “Too often, the general media either give superficial coverage to business matters or present them in a biased context. We will put a spotlight on the really crucial challenges facing our economy and give equal time to opposing points of view.” The show airs in Los Angeles on KYTY-AM (1470) at 11 a.m. on Saturday. Los Angeles Free Press, the city’s original alternative weekly, has been resurrected. Art Kunkin, the editor who started the anti-war paper in 1964, has returned to his roots to produce 12 issues of the new Freep. This time the Iraq war has replaced Vietnam, and display ads sell DVDs instead of vinyl LPs, but the spirit remains. In fact, the DVDs are movies about the psychedelic ’60s. For an update, visit www.losangelesfreepress.com. Pasadena-based Interpolls has brought together three of the Internet’s major portals AOL, MSN and Yahoo and online ad buyers to form the “Interpolls Network,” a new industry group. Media buyers and online publishers who belong to the network communicate and receive feedback through surveys and discussions with either and Interpolls, an online marketing research firm. Tennis Channel Inc. has secured exclusive non-broadcast network rights to the French Open. The deal gives the Los Angeles-based channel broadband and video-on-demand rights to the tournament, as well as access to media archives including classic matches from past tournaments, which will be used throughout the year to create French Open-themed series, specials and new media applications.
Staff reporter Joel Russell can be reached at (323) 549-5225, ext. 237, or at [email protected].
