How Does Advertising Really Work?

How Does Advertising Really Work?
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In his latest column for B&T, industry maverick, Robert Strohfeldt, sets out to debunk a fair few of adland’s truisms that often get chucked about…

We all know the answer to this, don’t we? Or do we really understand how advertising works?  The following states that advertising on social platforms doesn’t work.

An August 2017 study from CivicScience, an online polling company that surveys consumers on their favourite websites and social networks, found that very few US internet users have made a purchase based on ads they saw on social platforms, like Facebook or Snapchat.

In fact, just one per cent of respondents aged 13 and older said they made a purchase based on a Snapchat ad they saw, and only four per cent said they bought anything based on an Instagram ad.

Overall, out of the various social networks mentioned, respondents were more likely to buy something based on a Facebook ad they saw compared with other social networks.

But again, social commerce adoption among these respondents was low. For the most part, a large share (45 per cent) reported that they have never purchased anything based on ads they saw from these social media sites. Meanwhile, over a third said they just don’t use social media.

But before our “digital/social” marketers go into apoplexy, I could just as easily dig out research that will say much the same about traditional advertising media.

If I tried hard enough, I could conduct research that says I am 6’ 3”, 31 years old and irremissibly handsome. In other words, bullshit.

Two very big problems with market research:

  • Most sampling comes from panels. That is about as random as 10 ducks in a row.
  • In 99 per cent of instances, respondents don’t give a flying f.. um, a toss about the product or brand being researched.

Marketers and advertisers spend all their time focused on the brands and products for which they are responsible. The interest comes from the challenge of marketing and advertising the product. The Gruen Transfer has been a hit TV show. People are more interested, even fascinated, about what goes into marketing and advertising.

Numbers vary, but by most reckonings, the average consumer is exposed to between 10 and 13,000 brands years. Now that seems like a lot, but if you consider the billboards/out of home, supermarkets, hardware, liquor stores, fast food outlets, sporting goods – the list goes on and then include the myriad of advertising we are exposed to, it is a fair assessment.

The reason POS merchandising is so highly regarded and shelf space keenly sought, is the shopper is being exposed to the product at the time of purchase. For the vast majority of advertising, there is a large lag between seeing advertising and purchase. (A key reason why so many people say advertising does not work on them. But it does, though in a more subtle way than they understand.)

FMCG – Fast Moving Consumer Goods. Yet are they that fast? How often does the average household buy say, margarine? Just less than once a month is the average. Bread, milk, eggs etc. are consumed more regularly.

But even for such items, there is usually a gap of a couple of days to a week or more between seeing advertising and purchase – the decision will nearly always be made at POS and made in an instant. (Whether buying in-store on online).

So, for just about all items, there is a very significant lag between advertising exposure and purchase. Add to this the bombardment of messages/advertising they are exposed to and their memory is not overly accurate.

Individuals will give different responses to the same questions on different days. The simple reason is they are just not very interested, and they say whatever comes to mind.

The Ehrenber-Bass Institute has conducted a large degree of research into this phenomenon and found that approximately half the people who agreed with a statement in one survey, would disagree with it on a second survey. But the overall level of agreement remains within significant difference as the reverse is also true i.e. half who disagreed, would agree when asked again in future.

I feel sorry for people whose bonus and/or next promotion is linked to Nett Promoter Scores.  Along with A/B testing, they are as accurate as Astrology. (And have a similar number of believers.)

The higher the involvement/importance of the product, the less this occurs. For all but a very small number of purchases, consumers have a suite of brands which they will buy – choice is dependant on things such as availability, a price promotion, viewability etc.

Sad but true, in 99 per cent of instances consumers would rather watch paint dry than spend time thinking about and discussing a product. “Yep, I know that one and it is on special” – takes no more than a few seconds.

Late last year I fought my way through a dissertation by McKinsey on the major drivers of purchase. There were pages and pages of statistical analysis. At the end of this very complex piece of work came the conclusion.

The biggest single contributor to sales is awareness

Obviously, distribution is important, but that was a given. In a competitive environment, the single biggest determiner is awareness.

But great creative may not work at all if it does not brand the product. I am sure we have all encountered someone say “have you seen the ad, can’t remember exactly who for, but …” they go on and tell you the highly amusing or exciting event that occurs.

I don’t agree with everything Byron Sharp believes, but I think he nails the basics:

  • Consistency in brand identity is something many brand strategies lack e.g. when a new campaign is created, most of the attention is placed on what is new and fresh. Just as much attention should be placed on making sure the branding elements are similar and consistent: someone who saw the last marketing campaign should understand that the new campaign comes from the same brand.
  • The purpose of building strong, distinctive assets is to increase the number of stimuli that act as identification triggers for a brand.
  • Strength of distinctive assets of are a brand are determined by 2 criteria:
  • Uniqueness

To successfully teach the link requires commitment over many years, even decades.

Hence the now very old truism “We tire of our advertising long before the consumer does.”  So often a new marketing manager will come on the scene and in a bid to make their make, embark on a “bold new advertising campaign”.

Great creative can achieve great results but if it doesn’t tick off the basic strategic requirements above, no matter how sensational the creative execution, it is money and time wasted.

Where I do disagree with Byron Sharp is his dismissiveness of emotional and persuasive advertising.  The theories around brands and “Love Marks” are just plain silly. (Fucking stupid is probably a better description). But there are some categories where emotion plays a bigger role than many boring day to day products.  (See the Rossiter/Percy Grid). But generally, we are far more involved in the brands and products we sell than the customer.

Much of this article is Advertising 101, but the prevalence of media and data has pushed message creation far into the background. Plus, everyone seems far more interested in and excited by what the future will hold, they forget about the present.

(Name Deleted), global head of marketing innovation at Havas, makes no secret of how important he thinks AI technology is becoming. “These next-generation [cognitive] services are not only going to change advertising and marketing, but really change the entire landscape of everything in the universe, at least on the planet,” he said.

Who said drugs are no longer as prevalent in advertising. This guy is on something!

Media, data, future peddling and brand purpose have taken over advertising. The virtue signallers are happy the Madmen Days are gone forever,

I must go. Started crying into my Martini.

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Robert Strohfeldt

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