It has become an article of faith in the advertising and marketing world that traditional mass-market advertising is on the way out.
From the New York Times, December 28, 2004:
Jim Nail, principal analyst at Forrester Research, said, “You’re seeing the end of the era of mass marketing.”
Well, it’s a few years later, and it seems to me I saw some Bud spots on the Super Bowl. Also, I seem to recall seeing some iPod billboards recently. And aren’t those Toyota spots I see every time I turn on the TV? As I sit here today, mass marketing is doing a helluva lot better than “principal analysts.”
And yet every week I can still pick up a newspaper or magazine and read an article about how the Internet or TiVo is changing the world as we know it and the poster child of mass marketing, the 30-second TV spot, is dead and buried.
In fact, while data on this topic is hard to find and sometimes contradictory, here’s what it is telling us:
• According to Nielsen Media Research, among all households age 18-49, 2.6% of viewing time is DVR playback
• According to the New York Times, 60% of the time DVR viewers skip commercials
Do the math:
Incidence of viewing DVR = 2.6%
Incidence of skipping ads while viewing DVR = .60
Total ads skipped: 2.6% x .60 = 1.56%
So all this TiVo fuss is about 1.56% of commercials being skipped. More commercials are missed by people getting up to change their Depends.
What this data doesn’t tell us is how many DVR owners are watching more TV because they are now able to watch shows they would normally have missed. If the answer is that they’re watching more tv (and how could it possibly be otherwise?) the 1.56% gets even smaller.
On the other side we hear about how the internet is killing tv viewing. Once again, the data tell quite a different story. Since the year 2000, household tv viewing is actually up 9%. People are watching more tv, not less. In fact, the positive effect of more tv viewing is six times the negative effect of TiVo-ing. Try finding that fact somewhere.
With due respect to Mr. Nail, the end of the era of mass marketing is probably going to have to be postponed a few weeks. Let’s go out on a limb here and make a prediction: as long as there are masses, and as long as there is marketing, there will be mass marketing.
However, while Mr. Nail hasn’t exactly nailed it (couldn’t help myself ), he has inadvertently stumbled on something important. Marketers are turning more and more from mass-market advertising techniques to what they call “nontraditional” or “experiential” forms of marketing. This can include everything from very sophisticated websites to posters in urinals. The idea is that these forms are more “engaging” than traditional advertising.
Nontraditional marketing is not a new idea. Anyone who knows anything about advertising knows that experiencing a product has far more impact than experiencing an ad. Smallish independent agencies have been able to differentiate themselves over the years from their much larger counterparts by doing a fair amount of nontraditional marketing. What is new, however, is the unquestioned faith new converts have in it. While they will measure their cost-per-point and ROI in traditional media to the nearest penny, they will create zillion dollar web strategies just so long as some agency web genius tells them it’s cool.. As usual, the thing that is all the rage is being oversold and under-measured.
The conventional wisdom is that media proliferation and fragmentation have been the most important factors in the supposed ebbing effectiveness of advertising. Once we were able to easily reach almost everyone by buying a few TV shows, but today that is no longer possible. Consequently, the argument goes, mass media are not as effective as they once were.
On the surface this seems logical. However, one could just as easily make the counter-argument: it is certainly true that the media have become fragmented. But with increased fragmentation, any medium that can deliver a large audience—even if it is not as large as it once was—should be more valuable than ever.
Not only does this argument have logic to it, it has the added benefit of being true. In spite of the fact that audiences for individual TV shows have dropped significantly, media prices have not. In fact, on a cost-per-viewer basis, TV prices have continued to rise.
In the city where I live, household TV costs per point increased by 68% between 2000 and 2007. If we accept that the marketplace is the final arbiter of economic value, we must concede that mass media time is actually more valuable than it has ever been.
If you don’t have any 15-year-olds around, I suggest you hook up with some for a day and watch their habits. They are obsessed with media, consuming two or three at a time. Sure, the deck is being reshuffled with more media options and people moving from medium to medium. But not only are we not “at the end of the era of mass marketing,” we are in an explosion of media that, in the fullness of time, is going to make those media that can economically reach mass markets more valuable than ever.
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