Jonah Goodhart, CEO, Moat, a firm that measures ad viewability in the digital medium, was the key speaker at this year’s media review organised by The Advertising Club.

We bring you excerpts from his address made to a gathering of key advertisers and agency heads in Mumbai recently. The other speaker who spoke at the gathering was media veteran Shashi Sinha, CEO, IPG Mediabrands India. His talk is reproduced in the accompanying piece below.

“At a very high level, most of the advertising spend is directed to branding. In digital that’s not the case. Most of digital spends are evaluated on direct response – $50-billion revenue from search. This is about figuring out how brands tell a story in a digitally enabled world and that’s really critical.

We asked the largest advertisers on how they measure success when they spend so much money with major media channels. The answer is not a good answer as there is no consistent way to judge success in a digital world for brand advertisers. There’s never going to be a perfect answer as branding is an exercise in creating trust. There is never going to be a foolproof way to judge success in digital media or television. But we can certainly get better over time. Facebook said not so long ago that 99 per cent of sales come from people that do not interact directly with the brand. I find that interesting because for a long time Facebook spoke about getting people to like your ad. But they have stopped talking about that.

Increasingly there is a realisation that campaign results are not about a direct response but about getting a message communicated. And it’s a very different mindset that we need to approach

measurement with.

The offline factor One of the major challenges in the US, and also in India, is that the vast majority of products that we buy still happens offline. While we increasingly live our lives on digital devices, we still buy most things offline. Despite 300 million smartphones in the country, still online retail at best could be 4 per cent of total sales. So we have a gap and hence figuring out how those two worlds work together is absolutely critical.

What happens if we choose the wrong measurement system? What happens if we choose the wrong metrics? What is the impact of that? The impact is that we make decisions on the result of that metric. We decide what to buy and not to buy. We decide what creative works and what creative doesn’t. We used clicks as a metric for over 20 years in digital. It is a really bad metric. We need to ask a better question. As research major Nielsen said, there is virtually no relationship between clicks and brand metrics or offline sales. Research has also shown that even though people do not click through digital ads, they still notice it if it’s in the right context or the right place.

Going back, brand marketers have literally drawn the line and said this is the percentage of money we will spend on digital. That number has just got bigger over time. The impact is that $168 billion is spent globally on advertising on digital. So how do we use the right measurement?

What can we learn from television? A couple of decades ago, people used to talk about TV versus digital. We need to change that. Radio, TV, magazines and newspapers are all digital now and are all digitally enabled today. The question we need to ask is what works in television advertising. Maybe because it pauses your content, maybe there is sight, sound and maybe there is a story being told. That works globally. In the US, we are seeing marketers spend more money on TV this year. So what’s the problem? The problem is the changing customer behaviour. In the US, at 8 pm, the entire family sat down to watch TV. Life revolved around TV schedules. Other than sports we do not watch scheduled TV any more. We watch the shows we want, when we want and where we want. Behaviour is changing in this country as well. There might be one or two televisions in a household. But there are multiple devices and each one decides what to watch on their device. In that world we have to question how measurement works.

The young prefer internet When we look at the younger audience, the amount of time they spend watching television is a fraction of what they spend on the internet. The impact of that is that, in the US, it’s starting to change the way we think about media. The number of people who have cancelled Pay TV subscriptions in the US is over 10 million households. More than 34 million households (that’s a third of the population) have never subscribed to Pay TV. The number of people who watched the number one TV show every year is decreasing rapidly. Behaviour is fundamentally changing on how we consume data and how we consume content.

(To be continued)

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