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July 31, 2005

Beware the Recent Converts to ROI

In a recent Stuart Elliott New York Times advertising column, a senior executive of one of the top advertising holding groups bragged about the virtues of his company's brand new unit, whose mission purpotedly is to help clients measure marketing ROI.

Of course, the nagging question hanging over the entire article was, "what took you so long!"

The advertising industry has recently got that old time ROI religion in a big way. And with a zeal that is typical of recent converts, many of these former Cannes Gold Lion addicts now seem a tad too enthusiastic about their new found devotion to measuring the effectiveness of marketing. Perhaps what rankles us just a bit is the disingenuousness of advertising types who now preach ROI and aggressively promote their new units that are dedicated to measurement. These same executives have traditionally relied (and most still rely) on expensive TV, print and other brand-oriented tactics and media to meet their clients' marketing needs. They, and the advertising industry overall, paid scant attention to whether or not their marketing products were actually performing -- in other words, generating true results for clients. It was enough to focus on "the work," which became the end game. Not measurable results.

At the same time, the culture of "creativity," which has really become a code-word for "entertainment," put a strangle-hold on the ad industry, further diluting the importance of marketing performance and ROI. Sadly, this was an industry that once produced marketing giants like David Ogilvy, who preached the simple virtue that advertising should actually sell. How revolutionary!

Perhaps we are being too cynical here. We should welcome the industry's seeming shift toward ROI. If we felt that this was a real and lasting conversion, we would welcome it...with open arms. But, the news of the new ROI unit at the global ad holding group demonstrates that these marketing behemoths still don't get it. The emphasis on measurement and marketing ROI should not just be the province of a separate unit, which will charge separate fees to evaluate the work of their sister agencies (or competitors). In fact, however, that is exactly what this top-three ad holding group is doing with its new ROI measurement unit.

If the ad industry really wants to walk the ROI walk, then they must change their thinking and methodology entirely, and incorporate a measurement and performance approach in everything they do. That will take a fundamental cultural change which we suspect will be a long time coming, particulalry for the big agencies and their mega holding groups.

Meantime, there is a growing cadre of revolutionary marketers and their marketing firms who really do get the importance of performance, measurement and ROI in marketing. These marketing trailblazers realize that "media neutral" isn't just the latest industry buzzword. They are going back to the future, and enthusiastically embracing David Ogilvy's tenet about the importance of selling in advertising and marketing.

The main difference today is that, with the Internet, and the innovative new measurement technologies and techniques, marketers really can achieve ROI Nirvana like even Mr. Ogilvy never dreamed of.

Posted by Patrick at July 31, 2005 07:14 PM


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