On 1st March, Newsworks held its annual Shift conference in London. One of the messages Ray Snoddy came away with was the need for the advertising industry to shed its obsession with the shiny and the new and get to grips with what is a seriously deficient digital advertising supply chain.
Media and marketing specialist Paddy Barwise believes that 2017 is the year that the pushback will really begin against the uncritical view that digital is best in all circumstances – and digital advertising fraud will finally be addressed properly.
In a major contribution on the impact and funding of journalism in the established media at the Shift 2017 conference, Barwise, emeritus professor of management and marketing at the London Business School, appealed to the advertising industry at the Newsworks conference to resist always being attracted by the new and shiny.
In particular, programmatic advertising, according to Barwise, involved a long and not very transparent value chain that appeared to act against the interest of clients.
The World Federation of Advertisers estimates that value chain takes up to 60 per cent of a client’s investment. When The Guardian recently bought some of its own digital advertising, it found that up to 70 per cent of the value disappeared.
At the same time, advertising fraud accounts for up to 30 per cent of internet advertising.
“That means the publisher could be effectively getting only 70 per cent of 40 per cent – that’s 28 per cent of the client’s investment,” said Barwise, whose latest book is The 12 powers of a Marketing Leader.
“In the short term, it’s the advertiser who’s getting ripped off by the fraudsters. But in the long term, it’s all of us,” the academic argued.
The large and increasing investment in digital advertising emphasised the primacy of short-term tactical advantage over long-term brand building and, Barwise believes, has gone beyond the optimum for building shareholder value.
Barwise commended the results of the large scale analysis of cases from the Institute of Practioners in Advertising by Les Binet and Peter Field, suggesting you need to aim for a mixture of rational short-term and more emotion-based, longer term, brand-building advertising.
“The danger is that to fend off the chief executive or finance director, you (the advertising industry) overinvest in the things you can measure which, by definition, are those that produce demonstrable short-term results,” said Barwise.
“In the short term, it’s the advertiser who’s getting ripped off by the fraudsters. But in the long term, it’s all of us.”
Murky at best
He is also a supporter of Marc Pritchard, chief brand officer of Proctor & Gamble, who recently said the company was reviewing all of its agency contracts because the digital supply chain was “murky at best and fraudulent at worst”.
The remark at the annual meeting of the Interactive Advertising Bureau in the US was part of a trenchant attack on current standards in digital advertising.
P&G and other advertisers, Pritchard said, were “wasting too much time and money on a media supply chain with poor standards adoption, too many players grading their own homework, too many hidden touches and too many holes to allow criminals to rip us off.”
Speaking as a neutral observer, Barwise said he found it “outrageous that Facebook and Google are still marking their own homework and, in Facebook’s case, repeatedly having to fess up to miscounting the numbers – I think invariably in a way that overstates them.”
Barwise made it clear when taking questions that he did not think there would be a massive swing against digital this year, but he expected a showdown and to see both greater scepticism and more vigorous action against fraud.
“In my view, much more should be done on the ISBA (Incorporated Society of British Advertisers) side with no more marking your own homework and if you do, we are going to reduce the amount of spend you are going to get,” Barwise said.
The academic sees action by ISBA – and there are reports that action may soon be on the way – as Plan A.
If that doesn’t work, then Plan B could involve regulation and even legislation, Barwise accepts.
“Outrageous that Facebook and Google are still marking their own homework.”
Grown up thinking
The London Business School academic said he was not asking the advertising industry to be biased in favour of the traditional media just because it funds proper journalism in an age of fake news and alternative facts.
“I am saying, do the best for your clients and not go for new shiny things but be grown up and evidence based,” he added.
The challenge the advertising industry faces is to think of media strategies that use media in combination, based on independent Newsworks research.
“I think that will often mean including a significant investment in newsbrands alongside other media – which in turn will help fund quality journalism where there’s too much post-truth.”
As a self-confessed WOOPie – a well off older person – Barwise also expressed his hated of wrap-arounds – an abomination – and most native advertising was simply an unnecessary annoyance.
He conceded to his largely young advertising audience that he was probably more hostile than most readers to such phenomena but he represented “a large and growing demographic that controls a relatively high proportion of consumer expenditure and an even greater proportion of household wealth.”
Rik Moore of Havas Media used a game show to demonstrate that demographic stereotypes were not all they were cracked up to be.
For example, which age group was among the best able to cope with change?” Why, the over 65s of course including, presumably, some of Paddy Barwise’s WOOPies.
“The challenge the advertising industry faces is to think of media strategies that use media in combination.”
Circ down, reach up
The political journalist and writer Isabel Oakeshott emphasised that newspapers were developing new ways of presenting stories and far from dying were thriving.
Newspaper circulations may be declining but “newspaper content is reaching more people than ever. Newsbrands reach 47 million people in the UK – most of the population and their reach is growing.”
Newsbrands even reach 96 per cent of millennials – 18 to 34-year olds – every month.
Oakeshott, author of the controversial biography of former Prime Minister David Cameron, Call Me Dave, said she could speak from personal experience about the immediate impact of newspapers.
A couple of speculative paragraphs about Cameron the student and a pig’s head in a long and serious book had burst alive as a story that went round the world immediately and she had virtually had to go into hiding for a few days.
John Domokos (on the left) and John Harris.
One of the innovative ways of creating and presenting news came from two Guardian video journalists, John Domokos and John Harris who leave the Westminster bubble far behind and talk to citizens around the country in their Anywhere but Westminster series.
They ignore the traditional TV vox pops, three for and three against a proposition, and just allow people to talk to the camera, thereby often producing uncomfortable truths for Guardian journalists such as the strength of pro-Brexit feelings before the referendum.
“There’s a huge ferment out there and you don’t know where it is going,” said Harris who believes he and his partner are involved in qualitative rather than quantitative research, often more revealing and accurate than conventional surveys.
Sam Wise, head of planning at Saatchi & Saatchi paid tribute to the “unparalleled social relevance” of newsbrands with “insane levels of ingrained trust” combined with well-honed story-telling skills and a unique ability to sniff out interesting information.
“Creativity can help us unleash a bigger role for newsbrands but only if we never forget the special context of news media and try to live up to what that media is capable of,” said Wise.
The Saatchi executive cited Channel 4’s campaign for its reality show Eden with Metro, and biscuit manufacturer Oreo’s campaign which saw the brand “eclipse” The Sun newspaper.
Perhaps that was a wrap-around that even Paddy Barwise would approve of.
Shift 2017 came a day after PAMCo (Publishers Audience Measurement Company) held an update conference for its new cross-platform measurement system AMP – Audience Measurement for Publishers – before a similar audience.
There was widespread support and a lot of anticipation for AMP which is on schedule for a full launch in February 2018 following a year of transition from NRS.
There was hope from publishers such as Jim Freeman, commercial director of the Telegraph Media Group and Duncan Tickell, commercial director of Immediate Media, the magazine publishers, that the fortunes of the industry could be transformed by the new commercial currency.
Adam Crow, head of publishing at MediaCom, said he believed the “spend attrition (faced by publishers) could be halted and maybe reversed” by the provision of accurate cross-platform measurement.
Crow urged the industry to get to understand and use AMP, otherwise a lot of money would be “poured down the toilet”.
Freeman added: “We all have to get behind this. We need to make it part of our language.”
What was described as a world-leading system is based on a 35,000 strong sample of in-home interviews conducted by Ipsos MORI backed up by a digital tracking panel of 5,000. The data will in turn be fused with comScore PC and mobile panels.
The differences between the existing NRS system of measurement and AMP are fundamental.
For the first time, de-duplicated reach numbers for all platforms will be available daily, weekly and monthly giving better understanding of how consumers move between print, digital and mobile.
AMP will also provide data on more than 90 print, PC and mobile media brands compared with the current 28.
Simon Redican, PAMCo chief executive, conceded that AMP wasn’t a magic wand.
“It requires all of us to work really hard to make sure that it’s used day-to-day and that our products are aligned,” the PAMCo executive said.
What was the best way to do that?
“Appoint a commercial AMP champion in your organisation,” Redican said.
AMP is clearly an important component in the fightback of the newsbrands against everything from digital fraud and questionable data to disappearing revenues.
If it succeeds, the established media, the journalism it funds and ultimately society will benefit.
Professor Paddy Barwise should certainly approve.
Isabel Oakeshott and Sam Wise
“Creativity can help us unleash a bigger role for newsbrands.”