Why Advertising Works, Even When You Think It Doesn't
theatlantic.com
theatlantic.com
Since they have the picture of the Old Spice guy in the header, that's a perfect example to use. Those ridiculous commercials were not meant to send you running out to buy deodorant. Amongst other problems with that, deodorant is what we call a "low consideration" market - as in, you just don't really think about it. You came up with your go-to brand, then you just stuck with it because of inertia. You can't convince someone of the functional benefits of one brand versus another because they're all exactly the same thing.
Those Old Spice spots are meant to have a multi-year effect on your perception of the brand. How many of you remember that Old Spice used to be thought of as an old man sailor deodorant? They wanted to move away from that perception, and in a decade, no one will remember anything except how funky and hip they are.
I wrote about this campaign when it broke in July of 2010 here: http://www.joshklein.net/is-old-spices-viral-campaign-a-fail...
As an interesting anecdote, Tide has 70% of the detergent market despite literally being exactly the same box of chemicals as any other detergent. Except their box is a different color, and they advertised for 50 years so that your mother would tell you which brand to use when you went to college.
EDIT: It's worth mentioning that this kind of advertising is getting harder because of something you need to achieve called "share of voice". There used to be 4 TV stations that the whole country watched, so you could spend enough money to blast your message into the head of every American. This is obviously not how the world works anymore - you simply can't reach everyone, and even if you could, there's almost always a better way to segment your audience and only speak to the people who care. That's why I work in digital advertising, and think the TV/Print people don't have great long term prospects for their industry.
If I'm looking for a "low consideration" product, I just go for the cheapest one. They're all the same, so what's the point in going for a particular brand? This is where the "store brands" are nice.
For snack food, I check for MSG, which, if present, indicates that they're putting other nasty shit in and using MSG to mask the taste. If it passes that test, I'll try any of them once, then stick with whatever tastes good and has the least amount of ingredients I can't pronounce. Or I'll just buy some trail mix (whichever brand they happen to have).
If I'm looking for something I plan to use long term, I go to a number of trusted review sites to see what people are saying about it.
I've switched between Seagate, Maxtor, Fujitsu, and WD many times over the years based on which company maintained quality at the time and which one cheaped out (once again, based on reviews from places like Tom's Hardware, Consumer Reports, etc). You'd be amazed at the swings in quality these companies have year-over-year. Same goes for Asus, Abit, Gigabyte, Intel, MSI et all for motherboards, Toyota, Mazda, Ford, GM, Audi, Citroen for automobiles. Glues, power tools, jackets, shoes, bicycles, furniture... the list goes on. If you're not researching them, you're gambling with your money.
I could rattle off a huge list of advertising jingles I've heard throughout the years, but I've never paid them any heed in disposables (I buy the cheapest one), nor have I bought big ticket items without some serious research upfront.
1. You'd be surprised how effective some of the approaches are at a subconscious level, and 2. The mass of people don't spend a lot of time comparison shopping.
Try and find an American sitcom, minus laughtrack. You'll be amazed at how painfully unfunny most of them actually are.
Everything from the inspirational speeches to the insane personalities is accurate.
Also, in lieu of actual information, social proof (buying whatever everyone else buys) is a pretty good shortcut for picking the right thing. That's why we have such a strong compulsion for it; if everyone else eats berries from that tree, it probably won't poison you. If everyone else buys ipods, they probably play your music well enough to get by.
This bothers the heck out of rational optimizers like we people who frequent HN, but the average person simply doesn't care enough.
Perhaps the average person doesn't care enough because it is not rational to care too much. It takes time to fully optimize any decision, and time is precious.
But this leaves the question: Do you expose yourself to the advertising? Which advertising? If you don't expose yourself to ANY advertising, how are you supposed to choose things when you are standing in the store with no phone reception and no 5 year failure data? You take a deep breath, relax, and just buy whichever one you respond most to.
How is a small upstart company supposed to establish a reputation for quality in such an environment? Does a reputation for quality actually indicate true quality?
If a luxury brand item fails every few months and you have to take it in for complementary repair/replacement, how do you end up feeling? I used to laugh at people who bought super high-end luxury goods that I know from data are made from cheap materials.
But the reality is that the high-end company stands behind their product and they replace it when it falls apart since with their fat margins they can easily replace the products that have problems. The customer ends up happy. If you buy a "best of breed" product from a tiny company with razor-thin margins, chances are they will be gone by the time you are struck by a need to seek their help.
This is really hard for me to internalize, given that for many classes of mechanical products the benefit of super-over-optimizing is that you end up with a purchase that lasts for maybe 10x as long, which helps us try to ignore the reality that for most purchases we over-optimize, all we end up with is having wasted hours of time and decision-making energy for little noticeable benefit.
We've found that ads that just come out and say what we do perform much, much better. Simply bring up the pain point we solve and how we address it. Couple that with a call to action. Sure, it's pushy and unsexy, but it's easy to understand and it translates directly into user action.
Fortune 500 Marketing 101 breaks your activities out into the AIDA funnel - Attention -> Interest -> Desire -> Action. [1]
I can't think of any reason a startup would focus on any part of that funnel before "action" unless they needed to achieve some bizarro network effect for their idea to work (in which case they better have a couple million bucks to drop, and will still probably fail).
The sort of advertising before "action" presumes you're talking to someone who doesn't already know they need something like your product, and doesn't already desire something like it. The only reason to communicate to someone like that is if you've already maxed out your market share amongst people who give a hoot.
Brand awareness campaigns mostly just lack the Action portion (At least directly).
I think startups trying to create effective ads can greatly improve their campaigns by thinking about AIDA. I have transformed the marketing campaigns and ads of small companies I have worked for and create all of my own ads for my company while thinking about AIDA principles.
Brand awareness/institutional advertising is largely useless for startups but I think they can benefit a lot from learning a little bit about AIDA. It helps cut through the clutter.
IMO, google text ads (and affiliate schemes, and other similar products) are sales. You find a person with a problem, drive them to a landing page, then pitch to them. Maybe you to do it a few times, but the ultimate goal is to make a sale. The fact that it costs a lot less than a salesman is just a bonus.
Banner ads are more about building your brand, and could be considered marketing.
Amusing fact that I think actually helps to drive your point in further: those commercials are ostensibly about their line of body washes, not deodorants. In fact, Old Spice body wash sales have dropped since those commercials started while sales of their products on the whole has nearly doubled.
I actually believe the ubiquitous "crazy local salesman" is less about brand awareness, and more about demonstrating a unique selling proposition - even if you know about the crazy mattress salesman down the street, you can still order a mattress online just as well. But you can only interact with a completely hilarious insane person if you stop by the store.
I think there is another principle that comes into play even for a niche startup.
An startup gets initial publicity maybe from TC or HN or even mainstream media. I think it then needs to spend money on brand awareness advertising to keep itself from becoming "out of site out of mind". Unless of course it's mentioned everyday in the news (like Twitter).
My question to you (as the ad person) is do you think that a company like myspace could have prevented their decline at least somewhat by investing in brand awareness advertising meant counter Facebooks rise? (Forgetting for a second the things they failed to do or need to fix).
Also, good advertising can never save a bad product.
I started using Tide many years ago after, dissatisfied with my laundry results, I found a Consumer Reports article that said it was the best. I just did a quick search and they say it still is, although you can get your clothes almost as clean with some much cheaper brands (http://www.consumerreports.org/cro/magazine-archive/2010/jul...).
This makes me want to avoid looking at ads as much as possible -- we are vulnerable to manipulation in ways which are completely impossible to defend against.
Slightly OT: I used to think all ads were stupid, and the industry run by morons. Then at some point I thought that at least some of the ads seemed clever. At that moment, I realized that I'd shifted, and become a target demographic. The ads before weren't clueless, they just weren't aimed at me.
"When you're young, you look at television and think, There's a conspiracy. The networks have conspired to dumb us down. But when you get a little older, you realize that's not true. The networks are in business to give people exactly what they want. That's a far more depressing thought. Conspiracy is optimistic! You can shoot the bastards! We can have a revolution! But the networks are really in business to give people what they want. It's the truth."
No, the networks are in business to create desire. As a rule, people generally want what their peers want, so the chief goal of advertising is to create the impression that everyone wants the product. The very act of putting it in a prominent place is the first step, since everyone seeing it knows that everyone else is also seeing it.
Contrary to popular belief, the market isn't a simple system of people with inherent needs meeting those with products, but a complex web of collective psychology driven by a combination of the social network and mass media.
We need to go deeper.
It just works™
You can't say that ads don't work and also argue that most people are too mindless to ignore them!
1 - TV ads are more interruptive; to ignore them, you have to leave the room or change the channel. Most people just deal with sitting through them. On a website, you can easily ignore the ad. There are plenty of exceptions in digital advertising - pre-roll for web video, page takeovers, and other stuff that is unbelievably annoying, since your expectation as a web user is to not be interrupted.
2 - It depends on the key performance indicator for the campaign. Certainly, direct response campaigns want to measure clicks (or purchases/actions - the closest you can get to the sale, the better). But there are awareness-style campaigns on the web, and those advertisers pay by impression, not clicks. The problem is that with networks, you don't know the quality of the place your ad is running, so an impression is worthless. You'll only pay directly to a publisher you know is at a certain level of quality.
At a past company, I saw our media buyers put in ads at $170 CPM (cost per thousand impressions) for a particularly relevant publisher audience. The advertiser was in financial services, and the publication was uber-niche and uber-influential.
I don't know if I'm unique, but every single time I'm presented with a pre-roll ad, I close the tab I started the video in. 100% of the time. I always wonder if stats on that type of thing are collected and given to the "right" people. (I'm 90% sure they are not, but I thought I'd ask, since you're an expert.)
No, you are not the norm; video pre-roll is a particularly strongly performing media type at the moment. It does radically depend on the audience & creative, of course. But if you're looking at the rates of a publisher, pre-roll is going to be one of the higher ones.
If I accidentally move my mouse over an underlined word and up pops a video with sound over the top of what I was trying to read, well I certainly feel pissed off with Vibrant Media, and I probably get annoyed enough with the website that I won't visit it again.
I'm unsure if it has any actual effect on the brand though.
There is a movement to more multiple attribution style reporting - so when you get a sale you would see not only the click that generated it but the display ad that person saw that caused them to search on Google and finally click on your ad there.
If it's a loss for me, what can I do to defend against it?
If you only ever read one book on this stuff, this is the book to read. It is framed around the 6 core psychological principles advertisers leverage, with half the chapter on how to utilize the principle, and half the chapter on how to defend yourself against manipulation of the principle.
But more directly to your question; I think it depends. Was the product you just learned about a pharmaceutical drug that will help improve your quality of life, but that your doctor has never heard of because he left medical school 25 years ago and isn't tapped into current events in this particular field?
It's very possible (and I think, correct) to think of advertising as a net-negative to society. But it does serve the vital function of informing people about things they should know about. It solves problems of information asymmetry.
The startup deadpool is filled with companies that were awesome but nobody knew about.
(Except attractiveness. I'm just a regular looking guy, plus a lot of my work was telephone sales).
If I were to argue that advertising works, I'd argue that it affects social proof; no one drives a Mercedes Benz because it is a functionally superior car. In the American market, products aren't purchased on their functionality, but on the social class they put you in. (Would argue a similar argument for non-luxury items, but it'd tl;dr.)
(No, it is not a sufficient counter argument to say that they just spend because everyone else does; if advertising really didn't work there would no forces holding it up, and a lot of forces pushing it down. If you flipped a switch and made it not work somehow right now, advertising would be gone within a handful of years, if not faster.)
So direct response campaigns existed before google b/c there was some value holding it up; Google just came along and revolutionized it. That's part of their power from the advertisers POV -- metrics.
Large, nationwide branding campaigns have been effective b/c the entry cost to run one means they are only feasible to large corporations. And those corps have the resources to run the market surveys that are really necessary to evaluate the effectiveness of a campaign. Smaller ad budgets just can't do the followup efficacy measurements.
I definitely think both direct and branding based advertising works. I wonder if Facebook's play will be to revolutionize large branding campaigns, while google focused on the direct response (CPC v CPM, at its core).
But the thing is, it does it both ways.
Old Spice was mentioned here. They came up with interesting, catchy new commercials. That immediately endeared me to their product.
Other commercials are often (at best) noise or (at worst) insulting of their own customers. I can't count how many times I've seen what was supposed to be a funny commercial, and the idiot in the commercial used the product. Your customers are idiots? Really!? I have never yet bought one of those products.
Not that I bought Old Spice, because I like my current solution. But I did seriously consider it.
The other day I went to buy a lamp and the store had tons of one particular brand that advertises all the time. Of course I went right by those and bought another name I had never heard about, and it turned out to work just fine, and cost less.
So I guess that's why companies that advertise always puzzled me. I mean what's the point? Everyone gets annoyed at watching ads, so why would you want your brand name to be associated with annoying?
I guess I just don't get it.
How I wish that were the case! Meal planning and product discovery would be easy. Instead, I eat basically the same things over and over, since as a bootstrapping entrepreneur, I can't afford to throw away much food in the name of exploration. If we could get rid of the patent system that killed Modista (http://k9ventures.com/blog/2011/04/27/modista/), and replace advertising with information, I think my life would be a lot more awesome.
Advertisers sell advertising first, products second. It's not implausible to think they are better at the one that pays their checks.
Through-out the piece, the key evidence that advertising works was an anecdote that a friend of the author could remember two adverts.
And then, at the very end, almost as if realising "oops I forgot to actually back up any of this with facts" he adds "Access to data that proves their point." Oh well that's good to know, I guess that's settled then.
He could have written it in a "this is what they are trying to do" way, or if he really wanted this "I can show you that it works" then he should have actually proven it, not suggested it and then waved his hand in the air muttering "see I told you" under his breath.
Head on, apply directly to the forehead.
Head on, apply directly to the forehead.
Unfortunately that little nugget is stuck in my head for life, but I've never bought the product (nor do I know anyone who will admit to having bought it), so in that sense did the ad really "work"?
If I just wanted to flush my eyes out with water, I'd do that at home for a fraction of the cost. When my allergies act up, I need eye drops with actual medicine in them. And that's when I'm the least able to see well enough to avoid bottles with tiny print.
But Wal-Mart still stocks that crap in their pharmacy. Ugh. Shouldn't they limit it to medicine?
I'm with you- pissed off that I had to listen to it and avowed to never buy the product. But some people did.
My work is done here.
FTFY :p