Always on Advertising, Essay Example

Even though Nike and advertising agency Wieden & Kennedy had enjoyed a very productive working relationship, Nike didn’t hesitate to sign another advertising agency Crispin Porter & Bogusky due to its expertise in digital advertising(Vollmer and Precourt). Nike’s move demonstrated that marketing is an ever-going process that also evolves over time due to changing trends and consumers’ lifestyles. Nike understood that digital media is the new frontier for advertisers and it had to find a partner that could help it interact with consumers through the emerging advertising technologies. Advertisers’ interaction with consumers used to be primarily one-way but internet technologies have replaced one-way interaction with two-ways interaction.

The main argument of the book is that advertising is not what it used to be and companies and advertising agencies have to evolve to maintain their competitiveness. This is because digital media has radically transformed the relationship between the companies and their targeted consumer segments. Consumers now access multiple media channels including print, TV, and internet, and their media consumption habits have changed. In addition, companies can now directly interact with consumers who are now more sophisticated and demanding. It used to be that companies would delegate the entire advertising responsibilities to the ad agencies which included creating ads, choosing advertising channels, and creating brand perceptions. This kind of relationship between the companies and the ad agencies dominated Proposition 1.0 throughProposition 3.0. Starting with Proposition 4.0, companies started getting more involved with the advertising aspect of their overall marketing mix and have forced ad agencies to radically transform or risk losing the business. Companies have more power over advertising agencies because many small shops have opened with core competencies in digital media which not only reduce marketing costs but also enable marketers to narrowly focus ontargeted market segments. In addition, digital media also makes it possible to quantitatively measure the impact of advertising efforts which has increased the accountability of advertising agencies (Vollmer and Precourt, Marketers to Agencies: “Change or Die”). The implications of these emerging trends is that internet marketing will continue to grow in popularity because it gives more power to the companies to interact with and understand their consumers as well as quantify the impact of their advertising efforts.

Consumers have more power now because they have more choices in terms of media consumption and internet has made it easier to access information and compare products and services. Consumers can now easily skip ads they don’t like so marketers face the challenge to capture their attention as quickly as possible. Moreover, consumers today increasingly multitask and want more personalized solutions to their problems. This is why advertisers and companies are waking up to the fact that they have no choice but to study and understand their consumers better and many companies including Yahoo! and Communispace have set up digital laboratories to help their clients better understand their consumers(Vollmer and Precourt, Mediamorphosis: The Consumer in Charge).

Lead marketers are not unaware of the challenges posed by the emergence of digital media and changing consumer lifestyles. They are making efforts to build relationships with consumers by building web communities and websites that allow them to interact with consumers and learn about their opinions. Marketers are also more willing to build relationships with new partners in media and advertising if old partners fails to live up to the challenges and adopt emerging technologies as Nike’s example demonstrates. Companies are also demanding greater accountability from advertising agencies and demanding more specific data such as ROI on their advertising campaigns and behavioral data on specific consumer market segments.

The meaning of the book’s title “Always on” is that relationship building has become a 24-hour process for companies because internet has resulted in round-the-clock connectivity. There will always be consumers who would be interacting with their favorite brands at any given hour. Porter 5 forces model can be used to effectively describe the meaning behind the book’s title. Bargaining power of consumers has risen due to greater number of options and they can perform product/services comparison or shipping any time in a day. Thus, the companies have to continuously convince them they provide better value proposition than the competition. Effective supply chain networks have also become increasingly important due to global nature of supply chain networks in many companies and many companies have centralized their raw materials and inventory purchasing activities. In addition, the emphasis on efficient inventory management means supply chain management has become round-the-clock job for companies. Globalization has also increased competition by removing international trade barriers, thus, companies have to continuously monitor external environment not only at home but also international markets in which they operate. The threat of substitute products have also risen due the intensity of competition and higher degree of innovation, resulting in lot more choices for the consumer. Thus, the companies have to continuously remind consumers of the ‘unique’ value of their products which competitors do not offer and they are utilizing digital media to ensure they keep consumers engaged with the brands. Lower competitive barriers mean the threat of new entrants has also risen since many companies can access same low-cost factors of production in emerging economies. Thus, companies face round-the-clock pressure to enforce positive brand perceptions in consumers’ minds.

The main traits and approaches required in the future of effective marketers and their partners include flexible organizational cultures, willingness to adopt emerging technologies, putting consumer at the center of overall advertising and promotional campaigns, and gathering and analyzing data on consumers to better understand their behaviors and needs. In addition, the marketers and their partners may also have to introduce greater accountability and measurement matrices into their campaigns to evaluate the effectiveness of their efforts and change courses when necessary.

The book concludes that the interaction between companies and their consumers has become a round-the-clock reality and the companies have to become more involved in the overall marketing process rather than leaving it to their marketing partners. The companies should continue to monitor their consumers’ behavior and digital technology has not only created complications but also opportunities since it is now possible to target specific consumer segments(Vollmer and Precourt, The Future Starts Here) as well as collect data on them. Similarly, companies should continue to adopt media-mix which reflects the behavior demonstrated by their consumers. If more consumers move to one media from another, the companies should follow suit.

It is clear after reading the book that the current changes are new and, thus, require a new approach. The internet and new digital technologies have significantly altered consumers’ behaviors and lifestyles. In addition, globalization has also significantly altered the competitive landscape. Many advertising challenges posed by old media such as inability to target particular consumer segments, reliable ROI measuring tools, and data on consumer responses to advertising have been solved by new technologies. Thus, companies have to become more involved in the overall marketing mix as well as increase their engagement with consumers if they do not want to be left behind in the market place.

References

“Marketers to Agencies: “Change or Die”.” Vollmer, Christopher and Geoffrey Precourt. Always On: Advertising, Marketing, and Media in an Era of Consumer Control. McGraw-Hill, March 25, 2008. 144-148.

“Mediamorphosis: The Consumer in Charge.” Vollmer, Christopher and Geoffrey Precourt. Always On: Advertising, Marketing, and Media in an Era of Consumer Control. McGraw-Hill, March 25, 2008. 31-42, 56.

“The Future Starts Here.” Vollmer, Christopher and Geoffrey Precourt. Always On: Advertising, Marketing, and Media in an Era of Consumer Control. McGraw-Hill, March 25, 2008. 179.

“The Twenty-First-Century Marketing Mix.” Vollmer, Christopher and Geoffrey Precourt. Always On: Advertising, Marketing, and Media in an Era of Consumer Control. McGraw-Hill, March 25, 2008. 2.