ROUNDTABLE

Why must the media planning process change?

DON WHITE: Mass media plans are typically developed and evaluated against a goal to deliver a certain number of impressions to a defined audience. You invest in a mix of media, and you evaluate whether that investment has paid off based on the actual impressions delivered. The ability to link and evaluate mass media investments based on actual business results has been a challenge and therefore often becomes someone’s best guess.

Too often the best guess comes from the agencies that have a vested interest in the result. We believe this will change. Impressions delivered will remain an important metric, but new technology and best practices around mass media measurement will help marketers determine the true ROI of their media investments and that, in turn, will significantly change the planning process.

JIM BACHARACH: Marketing is changing and, therefore, the media planning that supports it must change. First and foremost, consumers are different. They are multi-channel and multi-media more than ever before. They are less loyal and have far more choices. To complicate matters, different consumers use each channel differently.

ALISON CROSS: The planning process is out-of-step with the times. It lacks the necessary sophistication. With all the data available today, it simply must change. For one, it’s too cookie cutter. By definition, one client’s needs differ from the next. Also, there is no accountability in the planning process. Although most media planners use predictors, these predictors are rarely coupled with any measurement of what worked.

DON RYAN: Media planning must take advantage of the fact that information technology has improved to where we can get information more quickly and consistently than in the past. Today, you can analyze what is and isn’t working far better than five or ten years ago. The media planning process needs to account for all this change and devise new “best practices.”

How should the media planning process change?

WHITE: In the future, the planning process will be much more iterative. Instead of buying schedule months in advance, marketers will be able to see results more quickly and shift buys around. Marketers should focus on making their investments more effective (i.e., achieving the desired results) not just more efficient (i.e., paying the lowest price). The benefits of being able to refine your plan sooner and more often will far outweigh any savings you might realize by buying farther ahead.

As marketers demand flexibility and the ability to tie results to their investments, media sellers will need to adapt, too. Marketers will be far more demanding and discerning about where and when undelivered impressions are delivered. The entire make-good model will need to change.

RYAN: Media planners must establish processes for “just-in-time” media planning and buying, which will leave marketers with more wiggle room to respond to marketplace change and new information about what elements of their plans are working. The objective is to help marketers make better decisions and to invest their resources in the vehicles that are best achieving their marketing goals.

BACHARACH: Planning needs to shift from a media-centric view to a cycle-stage-centric view. Rather than specializing in a given medium (like print or TV), media planners should specialize in the media for a given stage in the marketing cycle. Different stages call for different media. Promoting awareness entails a different mix than promoting consideration, purchase or loyalty. There is some overlap, but as you move through the cycle, your media selection should change. To best orchestrate the media planning process, you must consider which media to use at each stage of the marketing cycle.
CROSS: Measurement needs to improve. We need better, smarter tools to select the overall mix. Today's tools can optimize based on reach, frequency and CPM. But they can't make industry-specific adjustments. For example, the purchase cycle for a packaged goods product might be every four weeks, whereas for a big-ticket item it might be once every four years.

Current measurement tools only skim the surface. Click-throughs are a perfect example. Like Nielsen post-analyses, click-throughs tell you what the exposure was, but they don't tell you what the consumption was -- which determines your ROI. The question is who will change this? Agencies can pressure the Nielsens of the world for better measuring methodologies, but they can't control them.

Targeting also needs to improve. Even if clients can afford tonnage, it's often not the right answer. Targeting helps to bring the consumer to life and influences both media and message. Another obvious change is to tie in results, which requires a change in how clients and account people view and involve media people. Marshall's is a good example. When Marshall's gets it sales results from the day before, they are shared immediately with the media department so it can tailor the media plan and test weight levels against offer, geography, seasonality and other factors. Results need to be regularly factored into the process.

Does the message also need to change on a by-consumer basis, or just the media?

CROSS: The message absolutely changes. Targeting is not just for selecting media vehicles. It's for the messaging; for choosing promotional partners; for all marketing. If you don't change the message on a by-consumer basis, then your message plays to the lowest common denominator, which defeats the purpose of being targeted with your media vehicles.

RYAN: Anytime you target the message, you end up with better results. I anticipate that the biggest gains are going to come from optimizing the media mix. But it's both essential and highly effective for marketers to line up the right message with each different consumer segment they're trying to reach.

WHITE: I'm fascinated with the amount of money and thought that's gone into constructing CRM and ECRM capabilities where the end benefit is the ability to talk to current customers about the things that interest them, at the points when they're interested, through the channels and media to which they best respond. If you take that same thinking, rigor and level of investment, and you apply it to moving prospects through the front end of the funnel, you realize that all prospects are not equal. You need to identify which prospects have the same profile as your most profitable customers and which of these will be easiest to bring through the funnel. Then you must decide what messages, offers, and media combination this group will best respond to.

BACHARACH: Depending on where you are in the communication cycle, your message will differ. In talking about integrated communications, people have spoken primarily about having the same message and look across all media and contact points. But there is a deeper meaning to integrated communications that stems from orchestration across the cycle, from integrating each medium and the creative content in a real, rather than coincidental, way. Marketers must ask, "Where am I in the cycle with consumers?" and, therefore, "What must I deliver to engage and move my consumers to the next stage?" This is a highly considered, active and continuous orchestration of media, message and offer.

Do the planning cycles need to change?

WHITE: The planning cycles will be shorter. Building awareness and preference for your brand over time will still require reach and frequency. That thinking won't entirely collapse. But if you begin to more effectively manage how the mix works (versus isolated media), then theoretically it should decrease the time and investment necessary to get your brand message across.

It's taking all this fragmented media, understanding how it works in combination against a high potential segment, and then thinking about it in terms of critical mass -- how do I make it all work together in a synchronized fashion so that I get critical mass. Many smart marketing people understand this and know that they can do a better job. The issue is getting the right data.

RYAN: I'm amazed at how little information and knowledge sharing occurs in organizations. The planning process needs to disseminate information more regularly around each organization so that everybody understands what’s being learned, and so it isn't just the media planner who's sitting there saying, "Well, I've learned a lot of stuff because I've been doing analysis." New learning and data should be more frequently and systematically distributed across the business so that everybody's on the same page.

BACHARACH: The best media planners have always understood it's less about reach and more about engage. It isn't just about optimizing the numbers. It's about getting into the consumer's shoes. With my media mix, am I reaching, moving and finding my targets where they live? They must understand which media and channels consumers use, but also how and when they use those media and channels.

CROSS: Planning cycles reflect marketing cycles. Nobody should be laying out the full year ahead. Maybe that's how you get marketing budgets approved, but media plans are better viewed as a rolling process. Clients and media teams need to commit to regularly scheduled re-evaluation and tinkering throughout the year. Instead of being reactive, these regular re-evaluations should focus on getting ahead. Also, everything should be set up as a test. Clarify what you're testing, isolate the variables and design the test so you can read the results. Proven packaged goods testing principles can be applied here.

Do the skill sets of media planners need to change, as well?

CROSS: By and large, the skills are there. It's more the mindset that must change. There is a need for greater vision and creativity. And there's a need for greater ownership of the strategy. Long ago I learned you must treat the client's money like it's yours and challenge every assumption.

WHITE: Media planners need to be able to focus on the business results. They need to think about the goal of the client's investment in the media mix, how to measure the effectiveness of the investment, and how to change the plan quickly when they get information about its effectiveness or ineffectiveness. Right now, it's a very static process.

BACHARACH: A media planner must think of him- or herself as a party host. The host sets the stage and exposes the guests to each other, to the food, etc. The host sparks conversation and creates engagement between brand and consumer. It's more than getting people there. It's about the staging the right progression to generate the desired result.

The strategic requirements of marketing have not shifted away from account management to media planners. Rather, they've expanded to make media planners as important as account personnel.

RYAN: Analysis and measurement will become much more significant. So, in addition to their other marketing and organizational skills, planners will need to be more quantitative to understand the sophisticated information flow and how to evaluate it. Planners will need to actively shape, not passively consume, the information and analysis on which they base their plans.

How do you define creativity in media planning?

CROSS: Creativity in media planning has two facets. First is creative interpretation of data. This is the ability to examine numerous data points and see the overarching story. It's not just looking at the numbers, it's understanding what they mean. Media planners need to bring consumers to life through creative interpretation -- for themselves and their clients.

Second is creative strategizing. Appointment television (the insight that some consumers actually make an appointment to watch specific programs) is a good -- albeit dated -- example of a creative strategy that pushed marketers to see planning in more innovative, actionable ways. Creativity in media planning entails more effort, vision and a willingness to wipe the slate clean.

WHITE: Creativity is finding the most effective way to get my brand message to the audience that I'm targeting and to stimulate trial. It's determined by how various media choices are combined. To be creative, media planners must be conversant in the full media spectrum -- online and offline, awareness-building and more results-driving. A creative planner looks at media planning with a holistic rather than a fragmented perspective.

RYAN: Being creative is finding ways to speed up the process, to actually create data sooner -- through constant testing for example. It's active versus passive learning. The whole notion is pursuing learning on several fronts so we can gain and apply insights faster and more intelligently. Creative media planners don't rely merely on standard analytical approaches. The constant questions should be how can I make the same or better planning decisions in less time and get the same or better results with less money?

BACHARACH: An important component of creativity is openness. With all the available vehicles, it's easy for media people to stay with what they know, with what's worked in the past. Creativity entails curiosity, a willingness to experiment. It's linked with shorter cycles and testing being part of the planning/management process.

How do you manage and then apply the data available to optimize the mix?

BACHARACH: Many marketers do a good job of coding the individual elements -- an ad code, an offer code -- but they don't take the next step to create a mix code that links every element. This step makes the data that much more relevant and useful. It's the difference between planning overall media mixes and planning medium by medium. Mix codes are a way to literally tie the vehicles within a mix together.

CROSS: Media planners need better quantitative tools. It’s now possible to load in audience, cost data, and (if you have it) direct-response data. But it would make a far more powerful quantitative tool if you could input industry data, seasonality, product price, and other factors that influence how the consumer is going to respond. The biggest step toward this, to date, has been effective reach, in which you aggregate various factors to determine the frequency at which you need to reach a consumer before the message is effectively conveyed.

Delivery mechanisms need to go beyond monitoring reach, frequency and GRPs. To manage and apply the right data to optimize the mix, there has to be a way to input results. If I have all the up-front information for a given level of investment, then I can tie my results back into that information and draw stronger conclusions about what's working.

WHITE: The one thing that has paralyzed most marketers is the philosophy that more data is better. Give me as much as you've got, and let's build the biggest data warehouse, and someday we'll figure out how to use it all. Well, nobody ever figures out how to use it all. The right approach is to start with your marketing objectives; identify the critical information you need to make smart, timely decisions; and then go after that targeted data.

If you do it that way, you can rest assured the data you get will be easier to manage, because there will be less of it, and almost all of it will actionable because -- by definition -- that's why you chose it. It's the 80/20 rule, which just applies over and over again. It's identifying the 20% of the data that I need to make the decisions that will drive 80% of the benefit.

RYAN: Grabbing and warehousing every scrap of data certainly doesn't work -- not when the emphasis is on speed and responsiveness. By focusing on the key business measures with which a client makes critical business decisions, you can identify the advertising and non-advertising factors that influence those measures. These factors are what enable you to tie business results back to the actual marketing activity. The key business measures include traditional indicators, such as awareness, image and consideration, as well as more bottom-line indicators, such as calls, new accounts or registration, revenues or profits.

The trick is collecting this information consistently, at the level of granularity required to make the assessments that you want. The objective is to integrate the disparate customer contact data that's relevant to a client's business (whether it's a Web site, a call center, direct efforts, or whatever) so it can be linked back to the specific marketing activity that stimulated that response.

This entails sophisticated statistical algorithms that account for both attributed and un-attributed data -- which cannot be ignored.

How do you link specific sales results to broad-based media like network television?

WHITE: The idea of building models to quantify mass-media advertising isn't new. Packaged goods companies have done it for years, and some are quite sophisticated about it. What's new is the idea of the data continuously flowing into an automated model, projecting the impact of future investments, continuously measuring how investments are driving the business, and factoring these results back into the planning and buying processes.

BACHARACH: The statistical models are wonderful if you have plenty of data, both broad and deep. The key challenge has always been to keep them dynamic and make them accessible.

CROSS: Another approach -- although it won't work for everybody -- is what Marshall's does. Marshall's doesn't do lift analyses, but every day they examine their sales versus what they spent. This is appropriate given the promotional nature of their advertising. Branding efforts are a different story. But if, like Marshall's, you're pushing bathing suits over the weekend and on Monday morning you see sales increased, then it's fair to correlate your broad-based efforts with that sales lift.

What is required to ensure that the media optimization process is fully integrated into the marketing plan?

RYAN: Marketers will have to do some things they've never done before. There is no benefit to any of these systems if you don't use the information or make decisions differently.

Decision-makers need to actively incorporate this new information into the process and take what you might call a benefit-based approach to budgeting. Instead of sticking with the same vehicles and annually investing incrementally in each medium because that's what you've always done, you select vehicles based on their ability to drive business results within the context of the whole plan. The focus needs to be on the mix, not on making individual vehicles more efficient in isolation.

WHITE: It's going to take client and agencies working very closely together and building a plan that is iterative. It will take some pioneers -- on both the client and agency sides -- who set a standard for others to follow because their return on investments will be much higher.

The senior managers running agencies today fully understand that they need to become more accountable and put measurement systems in place. But agencies, typically, are not technologically savvy. Their businesses are client driven, so as a result, they are more reactive than proactive, and it's very hard for them to make the necessary investments.

BACHARACH: In marketing, there is old-school and new-school thinking. Old-school is leap-of-faith marketing with few goals and little accountability, where marketing is more art than science, and that's just the way it is.

CROSS: It's a link to results. Two things are required to ensure the media mix is optimized and is part of the marketing plan. First, all parties must commit to the process. Second, as much customer-related information is obtained as possible. Both steps require involvement of the Media Planning teams during the initial stages of marketing strategy development.

Any specific examples of how a marketer has gained competitive advantage by optimizing the media mix?

WHITE: In many ways the packaged goods companies, specifically P&G and Kraft, have done a really good job understanding what works and doesn't work across a variety of media and promotional activities. They are best in class right now. There is this huge gap between what they've done and everybody else. The big opportunity is trying to apply and think about some of things the CPGs have done for service businesses, such as harnessing technology and automating.

Financial services marketers, for example, have gotten very smart and do an excellent job with database-marketing. But many of them are flying blind when it comes to the mass-media investments they're making to build their brands. They’re even more at risk when they open up new channels, like the Web, because for them, the old metrics don't work anymore.

BACHARACH: Charles Schwab is an exception. They have astutely recognized how their customers have evolved in terms of their media habits and how and where they look for information. Schwab has not tried to homogenize their approach.

While Schwab was neither late nor early to the Web world, they embraced it. When you look at what they do, they are not trying to define people by medium. Their messages are delivered whenever, however you want them; whatever makes sense for you. Many companies remain ambivalent about the Web, but Schwab has profitably integrated the Web into not only their products, but into their marketing.

CROSS: I'd cite Dunkin Donuts. Originally, they wanted to go after Starbucks. But based on targeting analysis of their customers and customers at key competitors, Dunkin Donuts concluded that Starbucks had the wrong customer profile. Starbucks customers are more spontaneous, less reliable. Dunkin Donuts customers are all about rituals. They have spirit and life, but they're grounded in things and people they can depend on.

Using targeting, Dunkin Donuts identified the "regular refueler" as their core customer group. They defined the market and identified a large block of coffee drinkers who matched the "regular refueler" profile but who weren't Dunkin Donuts customers. Then they built all their efforts -- media, promotion, tie-ins -- around this "regular refueler," and store visits increased.

What is the ultimate payoff of optimizing your marketing mix?

CROSS: Beyond greater profits or results, the payoff is smarter planning. It means you don't reinvent the wheel. It means you can assess the relevant factors and drivers for each client. Constantly building and applying your knowledge base means less work and better results. You'll never have every answer. But if you can answer some of the questions, then you can focus on applying that learning while you address other questions.

RYAN: I equate the payoff to business results. I try to get down to what, from a bottom-line perspective, it means to a company. Unless a company applies optimizing the media mix to their business and they can observe positive business results than the investment isn't going to be worth it.

Conservatively speaking, marketers can expect to see at least 10 to 15 percent improvement in business results in the first year by allocating media investments more effectively. Most companies will see significant yearly improvements before they even come close to optimizing their media mix.

WHITE: The ROI is tremendous. If you think about major marketers who invest fifty-, seventy-, one hundred-million dollars in media, even a small improvement in marketing effectiveness can generate a huge ROI gain -- in terms of increased awareness, increased sales and increased profits. If I can bring in customers more efficiently by continuously fine-tuning my media mix, then that delta between what I was spending and what I'm now spending drops directly to the bottom line. If can spend $80 million but accomplish the same or more as I was previously with $100 million, or if I spend that same $100 million but convert 10% more prospects into customers -- the ROI is huge.