Should the TV networks replace ad agencies? That’s the question raised by “Media Rules” author Brian Reich (no relation) at a recent New York Media Information Exchange Group session and reported by Advertising Age yesterday.
Brian says the TV and cable networks know what their audience wants, while at the other end are the marketers who know their product best. Why, he asks, do we need to have ad agencies in the middle who (Brian’s words) know only half as much about the audience and half as much about the product?
Shouldn’t the networks work directly with the advertisers to craft the message, he postulates.
Brian is making some mighty big assumptions when he says the networks know what their audience wants. If they know their audience so well, why are they losing viewers by the millions?
And who will make the decision as to where ads should run to best reach the marketer’s target audience? And when they should run, to ensure the message is actually being heard and, ideally, being acted upon? The strategy of messaging and media planning and scheduling is best left to the advertising and/or media agencies, working closely with the marketers. To bring in the media at that strategic point may not work in the best interest of the marketer, since there’s a potential conflict of interest. The media, understandably looking at their own bottom line, will be tempted to try to convince the advertiser to “spend it all with us.”
And as for the networks doing the creative, it’s an interesting idea but how practical is it really? Imagine the confusion for the consumer as you see different ads for the same product on ABC, CBS, TNT or the new ION.
I do agree with Brian that the advertisers and media should have a more symbiotic relationship. In many cases, they already do when the media provide various forms of value added to enhance the reach and impact of an ad. In situations where the ad sales reps are acting as more than order-takers, creative placement often results.
But replace ad agencies with creatives at the networks? The idea will get people talking, for sure, but I don’t see it as a practical model.
Am I missing something?
Hmm.. interesting.
Shouldn’t subscriber driven websites replace TV networks?
Possibly, but the question remains — who will select which networks marketers should advertise on and who will create the ads? The networks? That what Brian seems to suggest.
Ironic. This weekend, I had this exact conversation with my brother (a media advertising sales exec. for a local cable company). He and I went around and around about the depth of knowledge the networks/cable company has on viewership, and targeting audiences. While I argued that our media buyer has the same information, but as well can compare it to all of the other networks/cable companies and soon the satellite networks as well…
And boy, have you seen the creative and production quality being spit out (literally) from the networks?!? I mean, it’s not all horrible, but it does fall into the “you get what you pay for” category…
Interesting conversation. I’m curious to see what others see that maybe I don’t…
Keep Cooking!
Andrew
David,
Let me start by saying I’m not in advertising. That said, I have been a marketer and a consultant for more years than I wish to share. And I seldom, if ever, recommend any kind of advertising for my clients.
For Fortune 1000 Companies who want to build brand and for some B2C comapanies, mass advertising can be effective.
However, for most companies, I recommend a greater focus on inbound marketing and less on outbound. The former offers greater opportunities for sales and revenues than does the latter.
Lewis, I think Brian was talking about the outbound part of the marketing mix, using mass and even niche media.
Yes, Brian was. I suggest outbound is less important than inbound.
Could be, Lewis. But then how do you create inbound “traffic” without outbound so people know you’re there?
David,
If we can afford to advertise on network TV, we likely have lots of inbound interaction from our current and most valuable customers. My assumption in reading your post is that we are discussing established businesses. I’m not suggesting we abandon outbound marketing but that we recognize that outbound for established businesses is more expensive and far less productive than inbound marketing.
But Lewis, Brian is saying that advertisers don’t need ad agencies, but should instead rely on the media to create their ads for them.
Inbound interaction is another story and,in many or most cases, isn’t done by an ad agency.
David,
We’re like two deaf guys trying to have a discussion. (LOL)
I get the point of your post. I’m trying to add a different point of view and another thread to the conversation by saying that focusing on advertising and ad agencies is not the best use of our marketing dollars, unless we are trying to build brand. And then I am explaining why I feel that way.
Conversations expand beyond the initial point when we add threads to them.
I understand. The deaf guys analogy may be fitting, since we both have white hair.
I can see the value of an inbound focus for many products and services, especially those that are not just off-the-shelf items. My experience with Dell, for instance, has always been excellent and it’s clear they put a lot of attention to their inbound customer relations. AmEx is another example of outstanding inbound work. Both, though, are spending many millions to generate those inbound calls and online transactions.
But you’re right — poor inbound service can kill a sale or prevent the customer from coming back again.
Brian is not the first to suggest this. It’s part of the same conversation about large advertisers bringing production in house and just doing the ads themselves (think of a company like Verizon, for instance.)
In the end, it all comes down to money: ad agencies, which once billed on a commission basis, had the money to pay the most talented people to create ads and thus they had a better product.
That structure may be cracking some now as agencies are far less profitable, especially digital ones. Networks would have to find a way to pay advertising creatives the same amount of money- currently that is not the case.
I’d also add, after watching the video, that one role of ad agencies should be the voice of the consumer- to tell clients that “this is what the consumer wants to hear– and what you, the client, think is important, is not really that important to your customers.”
I agree, Alan. I’m not so sure the TV nets are the ones to tell a client what the consumer wants. They’re not set up for that. And as I said before, they don’t always know what their own consumers want. If they did, we wouldn’t have so many shows on the air that no one watches.
There’s nothing to suggest that the ‘media planner’ at Comcast can’t do what the ‘media planner’ at your local ad agency can do. They use the same tools. One costs less, though. The marketer may need to work with a mosaic of other cable co’s (or other similar players in other media), but the fact remains — if it’s a commodity you want, go buy it the best way you can.
Frankly, I don’t see TV networks surviving in the near future. They, too, are middle men in an increasingly disintermediated world. If my TV has an ethernet connection, plugging in and getting my shows – when I want them, not when the network says I can have them – isn’t dependent on a network. Nor is it dependent on your cable company.
So it probably isn’t a question of “ad agency vs. TV network” — it’s a question of which content aggregates the eyeballs you want and how do you put your message there, too. Whole new world, isn’t it?
Great discussion, David (and Lewis)! I don’t know if this is your experience in the US, but here in Australia, regional TV networks often take on the creative. It comes bundled with a bit of planning, production and even casting.
As Stephen Denny points out, disintermediation is the challenge. Unfortunately, this means most cannibalize the value chain — rather than trying to legitimately transform their business. This is how the “mass” becomes “niche”.
Interesting, Gavin, but if regional networks handle the planning, how can the advertiser be certain his ads are being placed in the most effective and efficient media? Isn’t there a conflict of interest here, where the networks would be tempted to steer more ads onto their own air?
Stephen, I see the networks in the US eventually becoming like other networks on cable. As fewer people receive their signals over the air, they’ll become just another channel on the cable or satellite TV dial. But I still think that’s several years away, at least.