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25/07/2008 by
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Disintermediation Of Frenemy Google Continues

Recently I heard my boss, WPP CEO Sir Martin Sorrell say in a Cannes panel: “from Frenemy to Froe. He was referring to Google, at which WPP spends about $850 Million a year.

Friend, Frenemy, Froe or Devil?

If you understand the galactic power battle for media advertising Dollars, you will also understand the ever growing dis intermediation threat Google has become for all media agencies.

In my experience and vision, most very large advertising and media agencies, like most very large brands, suffer from corporate arrogance or ignorance. They think that they are able to move as slow as they want. But that modern business is about pacing up, innovation, measurement, accountability and changing (old) behavior. It’s the era in which getting things done talks, and thinking about it walks…

Here’s were you should doubt the theory of marketing guru Philip Kotler. In his time he was right about the 4 P’s: Product, Price, Place, Promotion. But, Mr. Kotler forgot P #5: People.

In todays organizations, the rapid changing world and media landscape,
human capital is crucial. Specifically when it comes down to innovation, the power of change management and making difficult strategic choices faster than ever before.


How many “open minded” people your organization has embedded and empowered, that’s the question corporates should be really asking themselves.

Especially in board rooms: how many people have you really empowered to lead your revolution? How many people you hired in your agency, that have the mentality and ability to forget old business models? How many people can clean their heads totally, to look at the same world through a brand new pair of glasses?

Well here’s your wake-up call! Google has hired a large team of people that can think disruptive. People that can think from totally new shaped business rules. The proof? Google has disrupted marketing as no other company ever did before. Small lean and mean brands can outsmart large brands with the deepest pockets (media budgets) with Google. And if you think disruption might stop at the borderline Google has drawn, think again. And again.

Social media marketing will disrupt marketing even further than Google did. And still large agency groups and large brands are not grabbing the seriousness of this movement. You want examples?

YouTube engages more consumers than ever before. Chinese Tudou will have more eyeballs than Chinese television within a few years. And Facebook knows more about consumers than traditional media agencies and brands together.

Large brands are not able to tap into social media marketing, since they have not allocated a budget line item in SAP yet. And this will take them several months to one year, so when they are finally having this new emerging category labeled and budgeted in SAP, many smart brands will have claimed their social media space already.

When large brands get the advice from their media agency to try social media marketing, they advice is mostly “try some banners”. But don’t let me get into the topic why so many brands and agencies refuse to see the real power of the Internet: it’s about communications, conversations, relationships and engagement.

So, stop trying to push your traditional advertising ideas onto the Internet, please. It will not work. So hire a decent interactive agency and ask them for a solid Internet strategy! Look at the powerful ingredients of interactive media, it’s in the bloody name: INTERACTIVE!!

Interactive is not interrupting people at sites and social networks with a shouting set of cheap banners. Social networks are social, so please do step in. But do it with the proper rules of engagement and listen to people! Invite them to participate. Or start conversations.

Communications has always been in your dictionary as: two way communications! Not one way! Not: I shout at you through my set of banners, so you can click on it. Internet is powerful to interact. Interaction is talking and listening, not clicking at banners.

Back to Google. Google has dis intermediated media agencies, since brands can do search engine advertising directly. And with the take-over of DoubleClick, Google now owns powerful consumer data on the Internet. And insights and knowledge are the next steps up in the value chain.

Consumer knowledge creates a powerful and strong relationships between agencies and brands. Much stronger than having a slightly lower fee or hourly rate. It’s not about the lowest GRP rates, it’s not about buying power. That’s commodity and short term. Knowledge and insights create long lasting friendships and mutual beneficial relationships, and that moves agencies up the value chain.

But Google is also giving away Google Analytics for free. So companies start finally tracking their website conversations seriously. And that tracking and accountable behavior pushes more and more companies’ media budget into the accoutbale sales machine called Google.

With YouTube’s video data, Google is making brands even more aware of consumer behavior and the power of measurement that leads to critical knowledge. If you want to use the Internet for Direct Marketing purposes or to drive sales, it’s not about reaching the target group, it’s about making marketing efforts accountable.

And the lack of willingness to measure and be more accountable, is the severe mentality issue in marketing and media board rooms. Agencies can only become partners with CMO’s if you are really willing to act like a partner. Willing to react on new tracking, research and performance measurement tools that are becoming available for everybody. And in this “accountable area” too many large brands and media agencies are reactive or neglecting to step into this direction fast enough.

Well, I can mention many other disruptive or dis intermediating actions by Google, but maybe their last launch will make you pay attention? Google has just launched Google Ad Planner, a research and media planning tool that connects advertisers and publishers.

When using Google Ad Planner, you can now simply enter demographics and sites associated with your target audience, and the tool will return information about sites (both on and off the Google content network) that your audience is likely to visit.

You can drill down further to get more detail like demographics and related searches for a particular site, or you can get aggregate statistics for the sites you’ve added to your media plan. So Google is again taking next steps to dis intermediate media agencies.

While Google Trends for Websites, announced last week, is designed for all users, Google Ad Planner is designed with media planners in mind.

Using Google Ad Planner, you can quickly create media plans and export to a .csv file, which can be opened in most spreadsheet applications. Or, you can export to DoubleClick’s MediaVisor, which helps you manage all your other media planning, buying and campaign management activities.

Google is strategically stepping-up in the marketing value chain fast, becoming a more and more trusted partner for brands. And Facebook knows more about consumers behavior (and lifestyle) than brands, media and market research agencies together.

So I’m glad I run an innovative agency that embraces new spaces, tracking and measurement tools. This behavior helps us stepping-up the marketing value chain and really is of strategic value to brand marketing officers. We think further than the last 30 seconds of a campaign, or reaching consumers as cheap as possible: that is the old thinking, that will not be sufficient added value to stay the CMO’s best strategic friend in town!

An agency that is willing to invest in change leaders and where people are the greatest assets, not product, place, price or promotion. I don’t know if leading such an agency, is the guarantee for a bright future…..

But I do know I do not want to become part of the boiling frog theory: a frog that keeps sitting in water that is getting hotter and hotter, until the water starts to boil. That will kill all frogs, since they think they will be able to stay in the water, while adapting to the changing environment surrounding him.

So, to all frogs I want to say, thank you for letting me share my feelings with you, but now please jump the hell out of that boiling water!!!

To all believers and non frogs I would like to say: be patient, your time will come sooner than you think! Or write down your feelings, it might bring some relief. For me it helped, so I will get some sleep now. So goodnight, and good luck…

 

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