Sherrill Mane: September 2010 Archives
An abbreviated version of this article
to AdAge.com on September 20, 2010.
The IAB, the ANA, the 4A’s and our member companies, and the entire marketing ecosystem for that matter, recognize that it is imperative to provide solutions to one of today’s most vexing marketing and media industry challenges: how to measure and evaluate interactive media. While there may be infinite ways to creatively deploy digital media, quantification of effects from basic exposure to brand-building, is seriously hampered, compromising the ability of marketers, ad agencies, and publishers to be accountable for advertising expenditures. The lack of consistent approaches for measuring exposure and assessing the effects of digital media has led industry to a cacophony of competing and contradictory measurement systems, contributing to a complex and costly supply chain.
For too long, we as an industry have fueled the problem and done little to suggest solutions. Some of the reasons for the digital media got to the today’s measurement mess have to do with both the entrepreneurial spirit that is characteristic of digital media and the innovation that Professor Clayton M. Christensen (Harvard Business School) describes in his work on disruptive technologies. Digital media are now at scale. It is time to solve the measurement mess and live up to the promise of being the most accountable medium. The ANA, the 4A’s and the IAB have a proposed solution and it requires the support and collaboration of the entire ecosystem.
As all media become digital, and more and more consumers migrate to digital media, today’s measurement complexity is preventing marketers from following their consumers with the appropriate degree of comfort that their marketing objectives can be met. The confusion surrounding measurement and the related lack of currency adds costs to advertising agencies as they are forced to use, subsidize and staff around more and more metrics and data in order to plan, purchase and post-analyze their media buys. Media companies have difficulties pricing their time, space and services, and digital media are not able to compete effectively for share of budgets.
Digital Media Measurement Today
Online media are blessed and cursed with an abundance of metrics. There are multiple vendors producing ever-growing quantities of data that often do not agree with each other, even directionally. And, more importantly, there is no coin of the realm - no “currency” - that governs the planning, buying and delivery of guaranteed audiences for advertising flights.
Media planning, the critical stage in translating marketing strategy into media outreach is done using syndicated audience measurement data that is often wildly disparate. Syndicated measurement services are the providers of competitive data and thus, of the currency of media planning.
Sellers use syndicated data as well as site-census data. Frequently, sellers rely on census data for traffic counts. Census data always yield different numbers than syndicated measurement, which incorporates samples. And the sampling methodologies may or may not consistently yield representative samples.
The currency for actual advertising buys is ad impressions served by ad servers, a dataset that does not coincide with the other datasets used in the planning and buying process.
Furthermore, internet measurement confusion is confounding the process of planning, buying and evaluating cross-media platform advertising campaigns. Current tools are inadequate and continue to frustrate the marketplace. For example, the debate over whether or not Gross Rating Points (GRPs) and reach and frequency calculations should be used across platforms still goes on, and is even more sharply felt when attempting to compare, buy, and analyze online video and offline TV advertising. All the while, it is still difficult to determine R&F’s of display ad campaigns across sites and ad networks, or stated another way a simple R&F within digital media alone is challenging to obtain.
The cacophony of confusing numbers is amplified by the fact that digital media also are evaluated and bought on direct response metrics like clicks and actions, contributing to the misperception that online media are not brand-hospitable.
Brand metrics that are agreed upon and capture data that marketers want are lacking. In addition, there are no widely accepted metrics that permit quantifying the relative contributions of online and traditional media advertising to building brands. Thus, there is no measurement approach or system for assessing brand effects and ascribing value to the various media.
Confusion about metrics contributes to two key areas of risk for the media and advertising industries. The first is the risk to marketers and their brands if they are unable to follow consumers’ migration to interactive media. Currently, according to Forrester, consumers devote approximately 34% of the time they spend with media to interactive. Yet ZenithOptimedia data show that in 2009 US marketers disbursed only 5.7% of their total ad (media plus marketing) expenditures on interactive media, a mismatch that speaks in part to the difficulties in planning, buying, and analyzing the effectiveness of those spending decisions.
Another risk is the threat of government intervention in digital media measurement. The Federal Government has intervened in broadcast advertising measurement in the past, and is currently exploring, at the state and Federal levels, industry and interest group complaints about miscounting of minority audiences in broadcasting. Minority audience measurement may well become a challenge to digital media, especially as consumers spend increasing amounts of time consuming video via interactive devices. Already, the Federal Government’s scrutiny of consumer privacy in interactive advertising environments threatens to undermine industry’s ability to obtain accurate site-census counts of audiences.
The ANA, the 4A’s and the IAB believe that the solution requires a radical rethinking of how measurement is viewed and defined by the marketing and media businesses. We need a cross-industry coalition of experts drawn from consumer marketing companies, advertising agencies and media companies that will identify and create consensus around the metrics and systems that are needed to run our businesses. While inspired by the findings of a report (“Digital Marketing Metrics: How Can Innovation Unlock More Dollars?”) done for the IAB and the 4A’s by McKinsey & Company, the structure, process and objectives of the joint solution are a distillation of many voices of many thinkers throughout the ecosystem.
The solution must embrace the needs of all digital media in a platform agnostic fashion. There is room to embrace and refine TV and print and display and mobile centric approaches. This figurative hug can only be extended if the more platform specific approaches can be crafted into a broad solution for counting and evaluating digital media and then going cross platform with metrics that matter. Ultimately, we as an ecosystem, as a community of leaders must create metrics and measurement systems for transacting business in way that yields the right budget allocations. Good selling is not about asking for fair share; it is about proving the value of the right share.
Measurement should be conceptualized as a business process that incorporates research science rather than as a research process that seeks support from the businesses. And that business process must be one that incorporates a vision and a structure for change management, innovation, and quality assurance. Discrete research RFP’s alone cannot fix the problem. In short, we need a governing body, the media measurement equivalent of FASB - the Financial Accounting Standards Board - an industry-wide body that sets standards and ensures that measurement will be consistent and easy for the sellers and buyers of advertising to apply transactionally.
FASB was formed over 35 years ago and is the designated private-sector organization to set standards of accounting and reporting applicable to non-governmental entities. FASB standards are officially recognized as authoritative by the Securities and Exchange Commission and the American Institute of Certified Public Accountants. Centralized standards of this type are important to business because they establish a trusted and understood framework for allocation of resources in our economy. FASB is independent from business and trade associations but seeks wide input into its decisions through a broad set of advisory groups.
In our industry the Media Rating Council (MRC) could play the role of FASB, but it would need to be empowered to do so across media which would take broader support from marketers, agencies and media organizations for this governing role.
It is mission critical that measurement and metrics stop being the favorite scapegoat of the media business. As an ecosystem, we must stop talking the talk and begin walking the walk. Media, both traditional and digital, have long blamed measurement for multiple revenue maladies. The appetite to systematically tackle the business process, the governing body, the identification of metrics and their conceptual and operational definitions and building the systems we need may not be genuine. “What would we do without measurement as we know it and so love to hate?”
As business leaders from across the ecosystem, we must identify and define the metrics that matter, metrics that take us from counting exposures to valuing exposures to contributing to brand health to putting paid and earned media together in creative cross platform campaigns, and providing easy to use post buy analyses. Yes, you just read that long bombastic sentence. And you will read it again because it captures the dire needs we have today. They will be exacerbated if we do not solve them NOW.
A Holistic Approach
While the IAB along with its members and the MRC have made much progress in creating standards and transparency in digital measurement, the work needs to be accelerated and to tackle the broad issues outlined here. As an industry, we must further integrate efforts to fix measurement. Only a holistic business process can get the necessary traction and only the right governing body can assure that good work is ongoing as continual change forces innovation.
The costs of proceeding independently with various and sundry initiatives with no overarching business process are high. An already confused marketplace may become further confused. The costs of doing business on the agency side may increase, thus reducing the agencies’ capacity to fully assimilate the data streams and types into media buys, thereby hurting the ability to buy right for their clients and ultimately reducing the consideration set of media entities that go into the planning and buying process.
We invite your support for Making Measurement Make Sense NOW. Join us as we solve the problem and build the process and governing body to make this happen FAST.
Sherrill Mane is Senior Vice President for Industry Services at the IAB.