Online branding in the age of performance

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performance_small.jpgADOTAS — The world we live in is steeped in a culture of performance. You can’t escape it.

Leave alone advertisements for the powerful BMW M3, even the environmentally friendly BMW Mini Cooper (44.2 mpg) takes great pains to proclaim its speed (0-60 in 8.5 seconds) for fear of losing out in this performance driven age. The spirit of the Olympics is no longer a torch that we light every four years – the quest for better performance is an aspiration that we lug around in our backpacks all the time.

Why should it be different in the world of online advertising? Why can’t our executive teams and clients expect better performance from our branding campaigns? Why should branding campaigns be insulated from the demand for better performance and higher ROI?

Luckily for online marketers, the Internet has recast the relationship between branding and ROI campaigns. No longer are they at odds with each other. With the emergence of performance advertising and engagement marketing, they can converge at a junction of symbiosis. Brand marketers can enhance important metrics like awareness, recall and recognition and be able to achieve ROI at the same time.

For this to occur, there needs to a fundamental shift in online marketing strategies. Brand marketers need to ring out the old and ring in the new. No longer can branding campaigns rely on the traditional “broadcasting” approach, where the advertiser message is sent out to an audience – be it through TV, radio, or an online banner.

Instead, branding needs to take on a more active approach, where brand marketers connect with interested consumers cost-effectively and engage them in relevant ways. This calls for a three phased approach:

Acquire consumers cost-effectively: Advertisers can grow their in-house databases by using advertising purchased through CPM, CPC and CPL pricing models.

The industry is already moving away from CPM advertising. The most recent IAB PWC advertising report showed that performance advertising accounted for as much as 57% of the overall online advertising spend. This is consistent with the overall evolution of online advertising, which can be narrated as a tale of a quest for higher ROI.

Just like in the last recession saw the growth of CPC advertising at the expense of CPM advertising, the current downturn is seeing the emergence of CPL advertising. Advertisers from a diverse spectrum of industry sectors like Kimberly Clark, UNICEF, Gold’s Gym and Coldwater Creek are using transparent CPL advertising to acquire consumers that are interested in their brand.

“The industry is moving towards CPL advertising,” says Daniel Taylor, senior analyst in Yankee Group’s Consumer Research group. “CPC pricing models are placeholders for CPL advertising,” he says. “Advertisers only want to pay for very specific consumer interactions, and not for wasted clicks or impressions.”

Engage by email: After acquiring qualified consumers in a cost-effective way, the next step is to engage consumers by email to keep the conversation going.

Through email, advertisers can communicate with consumers relevantly. This in turn makes a positive impact on branding metrics. What’s more, email is also good for ROI. Noted direct marketing expert Stan Rapp estimated that the average lifetime value of an email address to a marketer is as much as $118. Re-affirming this estimate, in a recent study released by Datran Media, 80.4% of executives said that email marketing (to an in-house list) was the best performing vehicle in terms of delivering the highest ROI.

Brand in meaningful and relevant ways: The last step is to drive people to relevant destinations. The 2008 Obama Presidential campaign directed users to a variety of information rich assets: Podcasts, Youtube videos, donation pages mobile websites and many others. Other successful engagement vehicles include the Dell Ideastorm community site, the JetBlue Twitter forum or the Kimberly-Clark pregnancy countdown widget.

Through these forums, the advertiser stays in control of the branding message. What’s more they enable more relevant communications between the advertiser and consumer – which helps drive branding metrics like awareness, recognition and recall.

In the age of performance, branding campaigns have just joined the party. By deriving ROI from their branding campaigns, advertisers will clearly be able to demonstrate to their executive teams how marketing moves the business needle.

— Express your opinion, comment below.

1 COMMENT

  1. All advertising is not created equal. There are different advertising quivers available to marketers, based on specific needs and situations. For those marketers with a need to generate a quantifiable amount of leads/revenue with their ad dollars, general awareness or even online display campaigns aren’t the best fit-for-purpose. With emerging digital capabilties and new media models such as CPA (cost-per-action), marketers can allocate risk-free dollars towards generating quantifiable numbers of customers and revenue dollars. Affilate networks such as Hydra, create brand-building campaigns using email, display, search, video and social media. These campaigns run over a network of affilates and generate costs only when deals close. These types of campaigns can actually be used to subsidize some of the softer marketing tactics which still have their place in the mix.

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