Time for new pitching models?

I have talked about this quite a bit in the recent months. The need for new revenue models with our clients is vital to our success, most especially in digital work due to the layers of work required and different aspects of the process that we can charge for e.g. strategy, planning/buying, ad serving, tracking, creative, project management etc…

Traditionally in big local and global pitches, the client has been more prominently interested in prices that the agency can deliver. While the client will highlight the major importance of creativity and in more recent days, being "digitally lead", more often thatn not they select the large global agency that offers the best price cuts in buying media - also applicable here are resources within the agency, ability to deliver on time etc...! Price is off-course most applicable, when the client is focusing on traditional medias such as Television & Print.

The pitching process I believe though is shifting in favor, in some cases, towards the more dynamic creative agencies that are truly lead by innovative ideas. I am not only talking about digital though, innovation comes from any media including for example digital, interactive outdoor & television. The creative pitch is starting to shift towards innovation and, the ideas are focusing on completely integrated concepts that have a clear defined path for the brand outlining the effects of the different revenue models and why they are there. It is not so vital to display TV 2.2% & Digital 7% for example... this is already a bit old really isn't it? Well off-course, maybe it depends on the client - but what about the shift towards behavioral buying, performance based models centered around leads & ROI... We could go into a whole discussion about different revenue models but then perhaps we'd be giving our secrets away eh?

Here in Helsinki, a few global accounts have gone from the big global agencies to newer style startups with far more innovative ideas - ideas that don't evolve purely around the masses, but rather creative ideas that are creatively modeled and in turn, new revenue models arise & the agencies make good on their return. Big agencies simply charge for their buying fee & maybe "consultancy" for strategies etc... - Common guys... get with the times and get more creative!

YouTube - Content creators can now make money.... Or can they?

So we all know Google is tryinig to figure out how to monetize Youtube.

Well, while the latest idea to let content creators sell their own ads seems like a good idea, I think Goolge needs to get a little realistic if the rumours are true!

Professional content producers, wth ad sales teams & the full mothy are now able to sell video avertising on their YouTube channels. That includes the click-to-expand overlays that run across the bottom of YouTube videos and display units on the page that hosts the video player. The revenue is split between the content creator and YouTube, just as it would be if YouTube sold the ads.

However, if we dig deep seems there are a few rumours going around  that YouTube is requiring that these ads sell for at least a $15 CPM, which is ultimately a lot less than the going rate for professional content. Content producers wishing to peddle their own ad space must commit to sell at least $10,000 — $4500 of which would go to Google — per campaign. At a rate of $15 CPM, that totals 666,667 impressions, a standard that only 44 videos from YouTube's partner program met last month.

Seems rather steep don't you think?
 

Marketing Effectiveness at an "All Time Low"

Found this nice little article about how Marketers worldwide believe that 65% of their marketing spend had no detectable effect on consumers in 2007. Marketing wastage is at its highest in more developed economies such as the US, UK, the EU and Australia. 3,000 marketing professionals across the globe were questioned as to the efficacy of different marketing tools. The responses suggest that their efforts reached an all-time low in perceived effectiveness - mainly for lack of accurate feedback. 
 
Fournaise Marketing Group tracks both offline and online marketing effectiveness, capturing millions of pieces of data every week. The report's findings reveal…

- 65% of all marketing spend in 2007 had no effect on consumers.
- Estimated wastage rates varied from 45% for business-to-business marketers, through to 65% for business-to-consumer.
- Just one in ten of respondents have automated systems in place to track the effectiveness of their spend.
- Of the 55% of marketers who do track the results of their spending, 80% do so manually, spending hours capturing, compiling and analysing data.
- Questioned on strategy, 70% of marketers believe that short-term revenue-boosting and lead-generation campaigns are more important than long-term intangible brand building (15%). A clear indication that  marketers are under pressure more than ever before to generate results.
- Tracking marketing effectiveness topped the 2008 wish lists of 35% of marketers, and made the top three for 70%.

To me this makes alot of sense, we need to track everything, we need to understand our clients objectives and how we are going to reach them... The above outlines that 55% of marketers dont track the results of their sending... So how the hell are we spending so much within the media & ad landscape. Are our clients not interested in ROI? Wow... we have so many tools & so much knowledge of this so I hope we are doing something about it :)!

Digital Media - Where is it heading in Finland?

I have had many conversations in the past months with various senior persons within the different media agencies here in Finland, with the core discussion centered on where the digital space is moving & how are we improving our agencies to ensure our clients are offered the best ideas and solutions.

In summary, these have been my findings:
 
- We need to move away from "Traditional Account Directors" driving the client across the board. If they continue to be solely responsible then those that do not, need to accept that they are there to perform a role – they are not the complete creative, strategic resource for their client – that’s why we have various specialist divisions. Not all but in many cases at least here in Finland, the client is asking for pitches to be digitally lead and they are not being digitally lead. They have a digital base to them but there is no completely integrated concept. While they say digitally lead, this does not mean come up with some separate digital ideas & show us you can get good discounts… and maybe add some SMS idea that will be advertised in the TVC. We should be trying to lead with ideas that have perhaps stemmed from digital but find ways how this content can move across every platform. Is it that most media planners who become media account directors simply have no real project management training or they simply are not creative! I am sorry if you are one and you rock but like many people in this industry, we really have few strategically led figures who, can do what the client needs in my opinion.

In saying this, I am all willing to educate our traditional media guys as this is really important but we do need much more involvement from the word go. This is obvious but why is it not implemented in so many cases? The point is, to truely achieve for example a campaign centered around branded content & perhaps advocism, we need one central idea & then we need to link all the medias together - not just a URL, but everything - what does the TVC do? Does it drive traffic, awareness... What are the objectives of each medium - sales, lead generation, ROI, awareness - if so how much, when, what, who...? We have to ask all these questions and many more… It’s called strategic thinking!

 
- Another thought also leads into how we can lead a client forward, or should I say, who is it that takes the core responsibility for leading the client forward! In most cases it has been the ATL / Brand agency. I don't believe that it should be the sole job of the "traditional creative agency" which in many cases it is, to come up with the overall concept & how it will work! How many of them really know how to maximize the digital space strategically? How many of them think strategically and not just creatively! A beautiful website could be avoided at times - its not beautiful to a client if it doesn't generate X amount of leads of meet their objectives is it? So the question is, how can we all work together? We all have different skills - some strategic, some deep understanding of human behaviour, some creative, some technical, some others thrown in the mix... But when are we going to realize that we need to offer the client all of these skills...

I hate to sound like a skeptic to the traditional agencies & people, but we all know that most of them do not carry the insight or experience to offer their clients what is required in digital.

I have seen many clients move to other agencies all over Finland – Why??? In many cases I believe it is simply the old school approaches to a client that are losing. Smaller niche agencies are teaming up with others, and creating incredible creative & strategic pitches with a difference… In other cases, the traditional agency just needs to stop being so head strong, allocate the appropriate resources to the pitches from all specialist avenues and think about one solid concept… and then how this will be brought together using all the medias!

So the point of my story??? We need to wake up, understand our clients better, find the right resources for our clients and use them… Think outside the box, think strategically and about the clients needs and real objectives! Use what is available to you & to do so use the specialist people around you! We are all trying to achieve the same thing right?