OTOinsights

"Atlas Solutions, time to wake the hell up."

Coming off the heels of the last post titled "The New General Agency" by my friend and colleague, Charlie Ballard, I felt compelled to explain why he ended with the statement "Atlas Solutions, time to wake the hell up".

As a matter of full disclosure, Atlas is a vendor One to One Interactive uses for third party ad serving (Atlas DMT) and paid search bid management (Atlas Onepoint).  We have been increasingly frustrated with the level of customer service we have been receiving as well as the lack of any substantial product innovation specifically around AtlasOnepoint.  To that end, we have started to review alternative technology solutions in the marketplace (We are meeting with Omniture tomorrow to review their new bid management product called SearchCenter). 

However, before we got to far along in the process of identifying an new bid management solution, One to One Interactive wanted to make sure that we were not shooting ourselves in the foot by divorcing our third party ad server from our bid management solution.  Too often we have received requests from clients regarding the impact their display/rich media campaigns are having on their search campaigns.  Questions include:

• Are my digital display campaigns increasing the amount of searches for my brand?
• What is the optimal display media spend level, reach, and frequency to positively impact search queries for my product or service?
• What is the latency (amount of time) between when someone sees a banner ad and then conducts a search query for my product/service.
• What is the conversion rate of those who engaged in both my display and search efforts vs. those who just came through a single channel?  Is the ROI on those converts higher or lower?
• Etc.

Since Atlas uses the same cookie for their third party ad server and paid search bid management solution, it makes sense that they easily collect the data to answer the questions posed above.  Indeed, a few of us at the firm got pretty excited when we ran across a recent press release by the Atlas Institute, their in-house think tank that studies the most effective ways to use digital marketing, titled "The Combined Impact of Search and Display Advertising"(96k pdf).   

A phone conference was scheduled between representatives of Atlas Solutions and our marketing services staff to explore if Atlas had someplace on their product road-map to provide cross channel insights between display and search..........we were met with silence.  What came next was even more disturbing.  The conversation went something like this:

• (OTO) We are interested in understanding the time frames around when Atlas will provide data/insights regarding how a clients display campaign impacted their paid search campaign.
• (Atlas) Why would you want to ever do that?
• (OTO) <with a mixture of disbelief, shock, and horror on our faces> Did you understand our question correctly?
• (Atlas) Yes.  To be honest, you are the first company to ever ask that type of question.  We really do not see the value in how the two channels impact one another.
• (OTO) Buh-Bye <Click>

Obviously, the people we were talking with were not too up to speed on the recent research that their own company just published explaining why it was important that marketers measure across the display and search channels.  More frustrating is that they destroyed whatever small amount of confidence that we may have had left in considering them as a viable online cross channel management and measurement solutions provider for the long term.

To conclude, I feel compelled to echo the sentiments of Mr. Ballard: "Atlas Solutions, time to wake the hell up."  I will go on to add the following plea: Omniture, please build, borrow, or buy a third party ad server so that we can move all of our business your way.

Jeremi Karnell-President, One to One Interactive

The New General Agency

The Winterberry Group recently came out with an 18-page white paper which can be downloaded here, highly recommended. Discussing in detail the rise of the online agency and its effect on traditional advertising, the study describes the effect that personalization technology and an increased focus on ROI is having on the the agency/client dynamic.

Despite a few questionable interviewee quotes ("This means less advertising in the future and less money for media -- all media. That's a reality." -Dave Morgan, CEO, Tacoda), the article is generally well-structured and thought out, and ends with a rather strong conclusion:

"Going forward, we expect even more dramatic changes to affect the marketing model. Exemplified most dramatically by the evolution of the established 'agency holding company' enterprise, it is likely that today's execution silos may disappear altogether, as brand advertising and direct marketing services merge under the banner of a new, consolidated "general agency" -- one that will be channel agnostic, following market demand rather than trendy creative in search of the optimal media mix."

I'd argue that trendy creative will always play a role within the channel-agnostic general agency they describe, as market demand will never provide more than guidance, and new ideas will always lead the pack.

That said, the discusson without a doubt further supports the ideas discussed in the Efficiency, Not Spend post relating to how the concept of a one-off, single-channel campaign is dying, instead being replaced with a web of connected tactics all supporting one central call to action, and the agencies that will survive will be the ones who are nimble enough to either directly support or at least manage all the different pieces.

How these kinds of more complex "metacampaigns" are going to be measured across all their aspects has still to be defined, but here's hoping that with an increased focus on analytics being integrated into tactical efficiency (see Omniture launching their SearchCenter product last year), the battle for the agency analytics spend will be won by the software who offers not just the deepest tools, but the broadest ones.

Atlas Solutions, time to wake the hell up.

Efficiency, Not Spend

Greg Slama just forwarded me an email with the article below (originally published here). Author Bill Wise could not be more on the money:

Efficiency Levels, Not Spend Levels
by Bill Wise, Monday, Jul 31, 2006 12:00 PM ET

So back to the original question: How much should you be spending in search? The answer is that you should be spending however much it takes to make you efficient. Once you've hit the right level of efficiency, the search dollars you invest will justify themselves.

AT THE MEDIAPOST SEARCH INSIDER Summit last week, my colleagues Kevin Lee and Brian Silver had the opportunity to sit on in the Insider's panel. At the end of the talk, the floor was opened up for the crowd to request future articles they'd like to see. I hope to get to all of the topics that came up; for today, I'd like to tackle just one: the issue of how to know how much to spend in search. It's an entirely reasonable issue for marketers to look to understand. Since search is relatively new, it's a new item for marketing budgets, as well--so there's little precedent against which marketing managers can set the bar. Meanwhile, search metrics are phenomenally precise, placing a level of accountability into marketing that's never been present in the traditional sphere. With that greater accountability comes more responsibility, at every stage of the campaign--including at the initial stages of spend allocation.

But as reasonable as it is to want to know how much you ought to be spending in search, the question happens to be largely irrelevant. After all, your goal in any business venture--search included--isn't to hit a particular level of spend; your goal is to get the right level of return. If spending a million search dollars a day would bring in three million dollars an hour, you'd spend it, no questions asked; and if spending 10 cents a day brought in only 5 cents, then even 3 cents would be overpaying. It's the profits you make, not the amount you've spent, that make a difference.

In other words, the focus on spend needs to be replaced with a focus on efficiency. Efficiency means getting the most powerful outreach you can, at whatever level of spend you're working at; it also means being able to drive a greater portion of the traffic you collect into conversions. Efficiency means, for example, creating optimized ad copy that attracts the searchers you want to attract, and that sends away the ones who probably won't convert. It also means delivering landing pages that are sticky and usable enough to drive visitors towards your shopping cart, registration page, or display ads that you're siring on your content site. It also might mean applying behavioral retargeting, to deliver ads to the searchers who have come to your site and left--so you can pull them back in and drive them to a conversion.

The more efficient your campaign, the less relevant the question of spend level becomes. That's because greater efficiency means greater net profit--which both improves your bottom line (the ultimate goal of your campaign), and gives you more money to reinvest on more advertising. Which means that $1 of efficient spend might be worth $3 of inefficient spend, and vice versa. The question of efficiency, in other words, changes the focal spend question from: How much should I spend? to How much is my spend worth?    

Building your efficiency requires understanding your customers. The better grasp you have of issues like where your core market lives, what times of day they search, what kinds of messages they like to see, and what kinds of sites they go to, the better you'll be able to reach out to them and build the architecture that drives conversions.

Developing that understanding requires that your search management has the best client services possible, and the best analytics possible--both are necessary for building an accurate picture of your core market's identity and behavior.

My only problem with Bill's sentiment is that he really should take the next step and apply his efficiency rationale to all marketing tactics. There is a total marketing budget which is ideal for any product or company, beyond which dollars are wasted. Despite year 2000 ad campaigns which would claim otherwise, you do not spend $100 million in advertising on a company which will never break annual revenues of $2 mil.

Within your optimal marketing budget, you also need to max out the spend on your best tactic until it is at the lowest acceptable level of efficiency, then continue to spend money on the next-most-effective tactic, while focusing not on each tactic's effiency unto itself, but on the aggregated efficiency of all your live campaigns.

If you have three tactics in market -- let's say search, direct mail, and DRTV -- and together they are producing an ROI which is only three percentage points above your lowest acceptable level, then you essentially have no wiggle room, and any new tactic you add needs to outperform any of your in-market tactics.

If, however, your paid search campaign is kicking ass, with an ROI 20 percentage points higher than the lowest acceptable level, well, then you have two options. You could pour more money into search -- and this is naturally the obvious, easy way to go -- until your Search ROI comes back down to its lowest margin. However, you also then have room to run with a riskier tactic, which may run too inefficiently on its own to suffer, but combined with the results you're seeing with Search, it may perhaps then put you at an overall return on your investment you can be happy with.

Which leads to another interesting point -- the relationship between all your tactics. As most new marketers quickly realise, no campaign operates in a vaccuum. Word of mouth, television campaigns, email, online display advertising, billboards, paid search, every one of these exists to not just drive revenue on their own, but to lift the results of the others.

Yes, you may find that your Paid Search efficiency was maximized at a $100k spend in Q1. However, if you throw that expensive and hard-to-measure DRTV campaign into the mix, you may suddenly find that your search volume skyrockets, to the point where your $100k Search spend is driving unheard-of efficiency due to the volume you're getting and where Google (and soon Yahoo!) is kicking you on your CPC. Suddenly you can spend $300k on Search while maintaining an even higher efficiency, all because you dropped money into a relatively inefficient tactic which nonetheless lifted all boats.

It's all relative, but now the game becomes figuring out the mix model so the result of every possible option's interplay with the others becomes defined and quantified. Should be interesting.

Jason Varitalk

Just when we all thought the Snakes On A Plane marketing buzz had a reached an imploding peak, along comes this ad execution which rivals the "put yourself in Wedding Crashers" site in terms of pure virability.

You go to the landing page, give it your first name, your friend's first name, their relationship to you, a few of their personal interests, their preferred mode of transportation, their job, and both your phone numbers, and Samuel L. Jackson calls them up and delivers a highly-customized message berating them for not going to see his new movie asap.

Threw my buddy Dan into the mix after finding the site yesterday, guy is bald and works for British Telecom. Dan got a call ten seconds later from Sam L. telling him (DANIEL!) needs to quit that lame-ass telecom job, stop screwing around waxing his damn chrome dome, and get the hell out and see Snakes... ON A PLANE!

Great stuff. Never seen so many new marketing ideas being pumped into one product, but damn if it isn't all working.

Trendwatching.com | Innovation Overload

Notable Technology Marketers on MySpace

Below represents three major technology brands that are using social network site MySpace.com to promote their brand and/or products via their own MySpace page.

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Company: Cingular

URL: http://www.myspace.com/cingularsounds

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Company: Dell

URL: http://www.myspace.com/dellditty

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Company: Motorola

URL: http://www.myspace.com/motoq

Tracking Virtual Worlds

As innovations and opportunities arise for marketing in virtual worlds how will analytics and optimization evolve? 

http://www.clickz.com/showPage.html?page=3613746
You think we've got problems with standardization, tracking, and reporting on advertising in the real (albeit digital) world? What do ads look like in a virtual world? How do you track impressions? Can ads be served by a third party? Are they interactive?

Campaign measurement will have to move past the standardized clickthrough rates and costs per click.  There will be a wealth of knowledge available regarding how exactly consumers view, and more importantly interact with a brand.  Interactivity will move beyond streaming video and rich media banners. 

Advanced targeting, that is just now maturing with online behavioral modeling, will be able to advance far past the basic "sites recently visited" mold. Private consultant and MIT lecturer Henery Jenkins provides a few visions of what the marketplace is moving toward.

http://www.we-make-money-not-art.com/archives/008575.php

For starters, avatars are certainly useful subjects for market research. "Marketing depends on soliciting people’s dreams,” says Henry Jenkins. "And here those dreams are on overt display." For instance, a company could track how inhabitants of a virtual world interact with a particular type of product, noting choices they make about product features, wardrobe mix, or even virtual vacation destinations. It could then use those choices to create profiles of potential customer segments.

The amount of marketing and purchasing data that could be mined is staggering. An avatar’s digital nature means that every one of its moves can be tracked and logged in a database. This information could be processed immediately. An avatar clerk might appear from behind the counter and offer to answer an avatar customer’s questions