They Have the Most Expendable Income and They Spend

Marketing campaigns frequently glaze over and disregard targeting audiences 50+. This can be a big mistake. Senior citizens have expendable incomes and have no issues spending it. However, you must know how to speak their language.

According to research done by AARP  “the 50+ market will grow by 15 million over the next 10 years. That’s nearly 3X the growth of the 18-49 market. Boomers command 71% of the entire nation’s wealth. The 50+ market make 39% of all online purchases. Boomers account for 51% of entertainment spending and 57% of big-ticket purchases including new cars. Boomers are an incredible economic force.

Yet, they’re an under-targeted market by brands. In fact, only 10% of marketing dollars are targeted towards the 50+ audience. That’s forty percentage points of all marketing dollars left on the table to match consumer spending.”  The biggest hurdle for advertising is to address and dispel the misconceptions of mature consumers.

Myth 1: Seniors are more brand loyal than younger generations

While this may have been true 40 years ago, today’s seniors are just as likely as younger consumers to change brands according to a study by AARP. Brand preference must have an engagement factor included for today’s seniors. “For example, in the 55+ age group, 31% of auto owners were “fully engaged” Gallup’s definition of an emotionally engaged customer.

In contrast, only 23% and 16% of consumers in the 17-24- and 25-34-year-old age groups were fully engaged (respectively). Among those who shopped at mass merchandisers, 34% of those 55+ years of age were fully engaged. In clear contrast, only 9% of the 17-24- and 25-34-year-old shoppers were fully engaged with the stores where they shop — less than a third of the engagement levels noted among the older consumers.”

Myth 2: Price is the only thing seniors care about

Price is no longer the #1 driving force in purchase decisions. Boomers and seniors have experienced too many undelivered brand promises in their lifetimes, therefore; “Companies don’t need to make stronger brand promises or make them more often and in more media. Rather, companies must focus on delivering their brand promises.”

Myth 3: Seniors don’t shop online

Retirees have plenty of time to research choices online. “Greenfield pointed out that…              29 percent of the 3,000 seniors surveyed spent two to three hours a day online. The survey found that 93 percent of online seniors surveyed have shopped online, compared to 78 percent of the general Internet population. 89 percent of seniors fully completed their online purchases, compared to only 70 percent for the general Internet population. Last year’s senior survey showed that 92 percent of online seniors had shopped online, and 78 percent had completed their online purchases.”

Myth 4: Seniors all think alike

Contrary to popular belief, there are three distinct mature consumer groups. Each is in their own spending and lifestyle faction: those 50-56 who are still in their peak earning years; those 57-65 who are still work but are planning retirement; and those 66 and older who have entered their retirement years.

Myth 5: Your brand message applies to all your consumers

Marketers wishing to reach this market would be wise to create specific messages targeting this group.

  1. Life stage marketing. Many baby boomers are facing various life stage changes such as a sudden empty nest, looking at retirement communities and retirement. Including these defining moments in your message can help make a quick connect with this target audience.
  2. Remove the risk. While they may have lots of disposable income, mature consumers watch their pennies. Removing the risk of them losing their money by offering a money-back guarantee, lifetime warranty or free trials.  
  3. Know your customer. In the same way that every cellular phone isn’t an iPhone, every senior citizen isn’t elderly. Those 50 and over have varied desires and needs.

Marketing to mature consumers can help mid-market brands increase their sales and create a strong advertising plan for build loyalty with customers for a lifetime. To learn more about how to tailor your message and purchase media to reach mature consumers, contact A3 media at (610) 631-5500 or email ashley@a3media.com

For years the advertising industry has been tasked with trying to eliminate ad fraud from the digital eco-system. And yet, rather than decrease, the problem seems to worsen. According to Dr. Augustine Fou, Anti-Ad Fraud Consultant and Researcher, reputable publishers account for only 10 percent of the money spent on digital advertising and generate only about one percent of impressions. The rest is being wasted on fraudulent publishers. If this is true, why hasn’t the advertising industry put a stop to ad fraud? Candidly stated, it’s easier said than done and there’s something in it for everyone.  

Suppressing the Truth                                                                                            

Eliminating ad fraud will also make fraudulent publisher inventory disappear. This in turn leads to a decline in available ad space to purchase. Less ad space to purchase on behalf of clients means a substantial profit loss for media buying agencies. It also would send the cost of digital media skyrocketing and its impressive CPM metrics would be lost. This would lead to more scrutiny on a ROI level.

To make matters more complex, buyers and marketers hire third party fraud detection groups to act as a watchdog for fraud. However, many of these fraud detectors are paid based on accredited impression levels, so it’s financially more rewarding for them to approve questionable placements. In some instances, they’ve been known to make claims that after further investigation, cannot be substantiated.

Marketers also despise delivering bad news to the client, which is another reason third parties help buffer the blow of digital fraud.  What agency would want to report an unsuccessful delivery rate of 90 percent to a client? Third parties are utilized to act as a legitimate source to soften the blow of disappointing results of campaign delivery.

Performance Facts Distortion

Marketers can’t change what the best of technology has to offer in fraud detection, and most rely on performance-based metrics to justify digital deliverables. This medium is moving faster than the speed of light and the security divisions aren’t keeping up with the fraudsters, but they’re gaining on them every day. Until then ad agencies can only deliver what the world can evaluate at this time, and many agencies quietly feel their hands are tied in winning the battle over fraud resolution. And, they certainly can’t tell their clients.

Unfortunately, most performance metrics that result from digital advertising are based on incorrect data. True conversions clicks and even impressions are easily falsified by bots. If performance-based metrics truly had an impact on a company’s bottom line, then any big change in digital advertising should be noticed.

However, so far, it hasn’t proven to be true. In 2018, for example, P&G withdrew more than $200 million from one advertising quarter of their digital advertising campaign. As a result, their profits improved, single handedly proving that after a certain threshold level of digital is utilized that additional digital advertising didn’t improve any of their business outcomes.

Will It Ever End?

While many attempts have been made to eliminate ad fraud, almost none have had a positive, lasting effect. Most recently, a cross-section of advertisers, and a hand full of media agencies including A3 media, and DSP and SSP platforms have formed a union to investigate whether blockchain holds any promise to end digital ad fraud.

The technology acts as an incorruptible digital ledger of transactions. When applied to digital advertising, blockchain verifies impressions and provides programmatic supply chain transparency through a neutral, decentralized shared register—capable of processing and verifying high volumes of data from multiple parties to reach consensus on the ads’ success.

While the technology is still in the early stages of testing, the results have been positive.

To learn more about fighting ad fraud in your digital advertising campaign, contact A3 media at (610) 631-5500 or email ashley@a3media.com

How do we repair trust between clients and agencies?

Nurturing healthy relationships went to the wayside eons ago. Somewhere along the path of courtship between agencies and clients, the art of having an enlightened and mutually beneficial partnership vanished. Trust is on the endangered list these days between these two parties, and the slate needs to be wiped clean. Partnership rules and strategies need to be defined, from the first conversation.

According to a study cited in Adweek “Nearly all advertising and marketing executives (98%) say that the best work comes when clients trust their agencies, collaborate (94% agencies, 100% clients), and maintain long-standing relationships (84% agencies, 81% clients).”

The first date……. Agree to measure what is measurable……

Agency consultants are drilling the point home about defining tangible and measurable objectives in the very first meeting. There is a huge disconnect on how clients and agencies perceive one another.  “In fact, marketers and their agencies differ on many basic business goals. While nearly all agencies (90%) say they understand their client’s businesses, only 65% of clients agree.” It’s vital both parties clearly define what the client’s problems are, how advertising can assist, and what is measurable.

Agencies have never had so much pressure to measure ROI. Despite living in a world filled with data usually there is not an exact number showing how an ad put a consumer in a store for purchase, but sometimes there is. Software capabilities and data resources are constantly updated and are evolving, but they are not free. According to Forbes To survive into the future, agencies must become Agencies of Return. To do that, you have to be prepared to measure everything that you do and take an honest look at your own results.”  Having an initial conversation defining capabilities and tangible goals can truly help nurture healthy expectations. 

It takes time to know someone….

Understanding a business, no matter how big or small it is, takes time. Clients are more and more targeted on choosing agencies that have experience in their category. While this has some substance, a good team of smart agency leaders have the same learning curve on any piece of business. That may come as a surprise, but there are parts of the advertising process that don’t require category specific experience. Brands are bringing a lot of creative work in-house or they are parsing it out to freelancers or boutique agencies, “project by project, not relationship by relationship.”  A smart team of advertising professionals will achieve success if given ample time to learn a business.

Creative payment plans….

Shooting from the hip and expressively offering his opinion, Michael Farmer (CEO of Farmer & Company and 25-year veteran advertising consultant) states quite candidly about how agencies failed to keep pricing models current. Gone are the days of 15% commission and hourly rates, but in the process of shrinking fees agencies are also burdened with knowing not just how to create or place ads on TV, radio or print, butnow they are expected to be experts in traditional marketing, social, digital, programmatic, influencers, e-mail marketing, native advertising…. and pretty much anything else you can imagine.”  “who cares what an exterminator charges per hour? You need to know what he charges to get rid of rats! In the same way, brand leaders—especially CMOs—need a partner that can help them achieve very specific financial goals. An hourly rate tells them nothing about what the agency can or will accomplish.”

This war of the wages began in the 80’s with the rise of popularity of the holding companies buying up Madison Ave. They sliced commissions down to 6% and put a lot of small shops out of business. Now however new pricing models have gained traction, and clients are on board with tying agency fees in with an ROI factor. The playing field is leveled if Agency of Record is replaced with “Agency of Return”. As Michael Farmer stated “I’ve had marketing executives look me in the eye and say, “when you can analytically prove that the money I spend with you is providing a return, then I have an unlimited budget.”

Dating the prom queen….

Madison Avenue has most certainly put the cherry on top of trust issues these days. “I’m convinced it won’t change the way these large holding-company agency executives operate. And that is a huge disappointment to me.” Farmer says. “Executives at these large agencies somehow continue to eke out profits through these sweatshop conditions, and they get huge bonuses for doing so. They’re all just praying they retire before the whole system blows up.”

Despite being cleared of all federal investigations this past November, the holding companies did put a temporary scarlet letter on the ad industry. However ugly this chapter of the book is, trust can be established from the first introduction, and like all successful relationships, communication is the key. Instead of going to bed mad, client’s and agencies need to stick together, ask the hard questions and seek out the best resolutions together.

Knowing how to craft them is the hard work

For regional and mid-market companies, radio advertising can be instrumental in helping your company gain a competitive advantage, especially over national brands. Radio advertising is an economical & effective way to reach an audience but creating a great radio ad isn’t always easy. Advertisers need a clear understanding of what motivates and influences decisions for their target audience. In our twenty-five years, A3 media has done buying and ad development for nearly 250 companies and we’ve learned a few things that work well for radio.

Articulation

One thing our team repeatedly sees happen is the heavy impact a minor change can make on radio spot.  Small changes can have a resounding affect. Like a well-rehearsed orchestra, the copy, music and sound effects must all play their parts properly. Don’t pitch them, talk to them. An ad, whether it’s radio or another media form needs to follow the same guidelines. Talk to them, be honest and let them know why your product is good for them.  

Precise articulation is what great radio ads are made of. Using direct language and messaging instead of clichés or generalities is what makes a great spot stand out from an average one. Don’t over promise. You need to speak locally and to the point. Without being blatant, make the listener believe you are a neighbor.

The KISS technique

At most, a radio spot is sixty seconds. That is a small window to grab a distracted listener’s attention. Driving a message that is simple and clear will stop listeners from becoming overwhelmed with too much information. Brevity is your friend. If you can tell your story in thirty seconds instead of sixty, it’s even better. One good point, made poignantly, will prove successful. If you have multiple messages create multiple spots. Radio spots are relatively inexpensive to produce and airing a variety of spots prevents burn out. Don’t crowd to much information into one spot. You’ll clutter the consumer’s thought process.

Create visuals with sound

Radio’s biggest challenge is relying solely on sound to drive a message home. Other media platforms can deliver brand messaging through visuals, but radio does not have that luxury. Relying on one sensory can however, be advantageous with the right kind of ad. The ability to tap into a listener’s imagination can be a powerful storytelling tool. Use a commercial as if you were writing a book. Let the sound and the message allow the consumer to use their imagination.

Narrow your audience

The best radio ads flow from an authentic connection between consumers and products. A common mistake is diluting a brand’s message in attempt to cover a broad audience. Advertisers often cast the widest net possible to avoid offending or excluding audience segments. The result is all too often bland ad copy that speaks to no one. Authenticity raises the bar of integrity and makes a brand credible. Don’t try to be all things to all people, you’ll end up being nothing to everyone. Zero in on a narrow population pool and produce creative that resonates and is relatable to that audience.

The offer

Radio spots that have a call to action can be challenging. DR advertising must inspire engagement from listeners and are typically campaigns enacted across TV or video platforms. Writing a promo code, website or phone number down while listening to the radio can inhibit a campaigns’ success. On the upside, if done properly, tracking the deliverables and results are much easier in these campaigns. It can be advantageous to see what moved your listeners to act and allows campaign optimization on the fly.

Strategy tips

  • Make the ad convincing. Give it a “wow” factor.
  • Keep it simple.
  • Creative messaging should answer the question: “What’s in it for me?” How will a product or service impact people’s lives in a way that will make life better, happier, or easier? Good strategies solve a problem quickly, safely, more effectively than the competition.
  • Jingles still work well for radio.

Whether you are interested in generating leads, increasing sales or just a bump in web site traffic, radio advertising when blended properly into your media mix, is a smart choice for regional, mid-market brands.

B2B marketing is more personal than you might think!

Most people believe B2B advertising lacks personal emotion. Nothing is further from the truth. Consumer behaviors are consistent. Peoples’ lifestyle, habits and viewpoints remain consistent and aren’t necessarily influenced much differently between a B2B or B2C campaign. With the lack of patience and ever-changing digital landscape, B2B advertising needs to be as fast, concise and as effective as any other campaign. So, what is the secret of creating balance between an ad that enacts emotions and logic when it comes to B2B marketing?

Six Emotions in B2B Buying

According to Geoffrey James, author of “Business Without the Bullsh*t”, purchasing decisions in B2B marketing come down to six primary emotions: greed, fear, altruism, envy, pride and shame.

  • Greed. To tap into the emotion of greed, show the buyer what they’ll win, improve or save by purchasing your service or product.  
  • Fear. Explain the benefits and advantages of your product or service to their business, employees or customers. 
  • Altruism. Do not drone on about yourself or your company, they don’t care. It’s all about them and how you can assist your perspective clients resolve their most pressing issues.
  • Envy. Provide customer testimonials that clearly demonstrate how you are successfully helping other businesses, employees or customers.
  • Pride. Share testimonials from industry leaders who agree that your audience needs and wants this product or service.
  • Shame. Tell them how a delay in decision-making will negatively affect their bottom line and make them uncomfortable, but in a subtle non-threatening way.

Rational vs. Emotional Needs

In a study that examined the impact of personal emotions on B2B purchases, it was found that 71% of decision-makers will make a purchase if an impact is made in their personal lives or within their personal value set. Personal influence on a business owner has twice the impact on purchasing decisions than a logical decision towards their business.

It is vital that marketers create ads that play on a purchaser’s personal value set as well as their rational goals.

In today’s world, information is available at everyone’s fingertips. There is limitless access to research available on companies and products. The drawback to this access and overload of data, is that products and messages can become watered down and lost in the abyss of facts, stats and data.

Your advertising objectives must allow consumers to feel confident that your solution will truly benefit their business. The best way to do this is by effectively customizing and streamlining your message with the right mix of personal value and business benefit.

The union between reason and emotion in advertising requires a subjective ability. You must be able to draw conclusions about what’s in a customer’s head and why and design a sales strategy to address these issues. This is no easy task, and while it’s a challenge, the rewards are worth it. Brands that master this skill are sure to succeed when it comes to marketing.

After reading my first three articles, you should have picked up on these points:

1) The Millennial generation is important, but shouldn’t make you change the way you handle all of your marketing.

2) Digital advertising “noise” seems to mostly benefit those who created it.

3) You shouldn’t doubt or change your view on how good business works, just because a new industry tells you that you should.

So, what do all these things mean for those, like me, who work in the advertising agency side of the business? Let’s take a look…

That fact is most ad agencies are about as popular as insurance agents. Businesses don’t want us, but they typically need us. And no one can blame them? Even John Wannamaker said, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half!” So, with odds like that how excited should our clients be? In my opinion, they should be very excited! If a MLB player had a .500 batting average, he wouldn’t be just playing for the Yankees, he would be part owner of the team! However, there is still a lot of skepticism and the reasons for the skepticism are justifiable.

The digital advertising media outlets will tell you that they can track everything and give you reports to prove what works. However, no matter how many reports you receive, there is still skepticism about whether this method of advertising really is doing what it says.

When Google rakes in billions in a single year of ads never seen by the human eye or Facebook invoices for ads seen for a nano second but claims everything is fine on their end, who wouldn’t be suspicious? When a “digital company” only delivers a 28% viewability rate, but then has the nerve to tell you they weren’t optimizing for viewability, but rather for click thru success, one must ask how can anyone click on an ad intentionally if they don’t see it?

So, what exactly are the ad agency’s responsibilities? We can’t just blindly spend our client’s media budgets on this internally monitored digital advertising industry and prosper from it. If you buy digital advertising based only on the standards mandated by the MMA or the IAB and use them as the trusted watch dogs for this “Wild West” industry, be very careful! While these organizations may mean well and are working harder to develop higher digital standards, if you dig a little deeper, you’ll find that there is a lot more work to be done and as an agency, it’s our responsibility to our client to see that it gets done.

Remember, media outlets, whether traditional or digital, are businesses, plain and simple. Many of them proclaim to have certain values, but in the end, they were built to make money! Media outlets like to preach equality, but if that is the case, why does nearly everything tilt in their favor? Whether it’s a non-comparable make good, a slew of added value that never airs, or the price-hike needed to make digital ads viewable, every one of these leans to the media outlets’ favor and does not benefit the advertiser. In the end, they’re the “house,” so the deck is stacked in their favor. I have found that being diligent is the only way to turn the results in the favor of our clients.

As a client, you should trust your agency. Just like your dentist, doctor, accountant or lawyer, your agency is the expert. That’s the reason you hire them. It is your agency’s job, or better yet obligation, to have your best interest in mind when handling your advertising budgets. They ultimately, become the toll-takers between your budgets and the media outlets.

I realize, as an agency owner, that our bottom lines are also important, but we aren’t just the middle man between a company and a media outlet. It’s our responsibility to earn that money, not just process invoices blindly. Agencies need to be the police force in the ever-changing digital advertising universe, navigating through the land mines in the digital world, while working to improve the bottom lines of their clients.

Since our clients are the ones who write the checks to pay for all this advertising, and are ultimately our boss, we should spend their money very carefully. Doing what’s easy, following the industry, and chasing after one generation simply isn’t acceptable. Agencies should be diligent, ask questions of the advertising industry, make smarter decisions, and guide our clients based on our knowledge and credibility.

So here is the main take away: All advertising is key to your success, especially digital advertising, if you intend to reach millennials. But digital is not the only way to reach them, or anyone for that matter, and shouldn’t be considered the savior of your business’s future. Traditional media is always relevant and necessary as well. It’s finding the proper mix that will win the day. Remember, while millennials are one of the largest generations in our history and presently represent 25% of all buying power, you’ll want to remind yourself that many of their habits and interest will change with age, much like the Hippies of the ‘60s.

Until next time…. I’ll see you around the water cooler app!

Do you find yourself trying to get a handle on this ever-evolving world of digital advertising? When you finally figure out one method of advertising, you’re told that it’s no longer relevant and you need to learn about and understand the next new thing? We’ll call it “shiny object” syndrome.

You probably went to college and studied some form of business. While there, they taught you the importance of marketing, knowing your consumer, and understanding what fuels a better bottom line. Experience has taught you that quality and quantity are not necessarily equal to your bottom line. You believe in your products; your company’s R&D department works hard to achieve higher goals; and your HR department attempts to better the lives of everyone working in your company one way or another. You have all the makings for a profitable business.

Then you find that a self-made, self-serving, internet industry has risen from the dirt in the past 20 years and changed all the rules. These multi-billion-dollar companies are preaching what you need to do for your business. “Millennials this” and “Millennials that” is their new mantra. They now tell you that ROI is insignificant and you don’t need to tout your products’ virtues. They preach that people want to buy from companies that uplift their self- image. “It’s important to be an environmentally friendly company.” “Be a company that donates to charity.” These are things that will gain you respect from and grow your business with this newer generation. “Don’t worry about ROI,” just get people to “like you.” The money will follow. The digital companies repeatedly say these things to the companies who purchase their services, while they, themselves, continue merging, expanding and increasing their own profits.

Companies like Apple have taught an entire market that owning their products is like being in a special club, and then they make their products obsolete so that consumers have to buy new ones at higher prices. Gaining revenue is exactly why Facebook purchased Instagram, Oculus and WhatsApp and why Google owns You Tube, Blogger and a slew of other sites. They have a focus on their bottom line.

The Internet giants need more avenues to create advertising opportunities, so they can sell them to you. The more they create, the more inventory there is, the more noise they generate, and the more expensive it is for you to rise above that noise. See the cycle? It’s the tail wagging the dog! So where does this put you and your business? You’re punished if you do anything but sit around a campfire and sing Kumbaya and hand out free Smores!

While digital media is a necessary medium, you want to remember that those who hit it big usually spend big. Sure, there are exceptions to every rule, but look at the most successful digital stories and you will find very deep pockets. So invest in digital, but not at all costs.

To build a solid plan, you’ll still need to utilize traditional medium. Despite what the digital giants and ad mags say, these mediums are not dead and people still see and appreciate them. Even millennials. Find that hard to believe? Then ask yourself this. Do you consider electronics, website, software and tech companies, high tech performers? If so, then why aren’t they 100% invested in digital only? Just look at a brief list of TV advertisers: Airbnb, Trivago, Expedia, Apple, Samsung, IBM, Microsoft, Match, AT&T, Verizon, Xfinity, Dish and Direct. Even the all mighty Netflix uses TV to get their message out. Don’t they sell to Millennials? I believe they do. And it’s not only TV. I just saw an entirely new Apple I Phone campaign on an outdoor billboard!

The fact is you need to look at all the advertising avenues available to you, not just one. Sure, “used car, hard selling” tactics aren’t the best tactics, but if you believe in what you do, then say it, wear it, and make sure everyone else knows it too, no matter what medium you use.

So, take a breath, stay focused on what truly matters to your company, and take a well-balanced approach. You’ll still want to donate, take pride in going green, and promote clean water, but you’ll no longer be doing it as a photo-op or to find favor with some. You’ll be doing it, because you mean it, and donating anonymously is a beautiful thing. Remember, what really matters is how you carry yourself when no one else is looking! And one more thing, a millennial may be a millennial forever, but they won’t always be 25 years old. And those of us with a little gray on the temples have one thing none of them have: the experience to know there are cycles. While these cycles may change, they never stop, so it’s important to stay consistent.

In my last article of this four-article series I’ll cover how your agency needs to continue to educate you and themselves, while striving to shield your company from the hysteria and fraud that abounds in the digital ad world. By collaborating, you will strengthen your position in the market with this generation.

Until then, I’ll see you around the water cooler app!

To read the next article in the series, “Toll Takers vs. Watchdogs” click here.

In addition to understanding the millennial generation (which was covered in my first article of this series) and how important it is to any business’s marketing focus, the way we go about reaching that audience is equally vital. Many believe digital advertising is the “cure” for your businesses growth and success, particularly to millennials. Unfortunately, many companies often go off the proverbial rail in an attempt to follow that route. But is that really necessary? Please allow me to answer that question with a single word, “No.”

With so much importance being placed on reaching millennials, I decided to re-educate myself on this matter. I and my entire buying team attended a two-day digital advertising summit led by business and tech leaders, digital developers and software giants. It covered everything from email commerce and professional social elevation to font size and geo targeting.

Every speaker at the event had one common point; how to rise above the noise that dominates the digital world. Unfortunately, not only were their solutions inconsistent, some were down right contradictory. One person told us email is the greatest and most productive form of e-commerce with the largest ROI, while the next speaker’s topic was titled, “If email is dead, then you killed it!” I also learned that you don’t need a lot of money to create a ripple, while also being told that businesses need to make a significant investment if they wish to connect with millennials. Pure noise, and it didn’t stop there…

They showed us examples of cool social-branding with investment levels of $40MM to $100MM were spent. In one case, the investment was said to have been so successful it “created a lift for six whole weeks!” More noise!

These tech giants made some incredible claims. They implied that businesses can target the behavior of every consumer, pinpoint everyone’s location, and determine intricate specifics, including whether a person uses Charmin or Quilted! They explained ways you can completely irritate a consumer or make them fall in love with you.

There were folks there from the Interactive Advertising Bureau (IAB), Mobile Marketing Association (MMA), and American Association of Advertising Agencies (4A’s). They all explained the digital advertising model and how it was going to continue to move and improve, but most likely at a steep price. Where there was once a cost per impression rate(CPM), a cost per click rate (CPC) and cost per acquisition rate (CPA), there would soon be a cost per engagement rate (CPE), which may cost you up to $100 per engagement. “But it will be worth it,” they assured us, “because you’ll have a bonafide lead!”

More than one speaker explained that businesses shouldn’t worry about profits; they should focus instead on making a difference in the world and helping the consumer feel better about themselves.  According to them, that’s the real way a company rises above the noise. But, they added a caveat, as well: You must continue to be mindful of profits, at least to some extent, in order to remain in business.

Now, I ask you, does any of that make sense? The fact is the only thing I found to be truly clear after hearing these industry professionals speak is that all this “noise” they were suggesting we “rise above” seemed to be coming from them! I realized as I listened that this isn’t noise at all, but actually a diabolical business model they use to create noise, corporate insecurity and which keeps all of it veiled in a cloud of uncertainty and it shows no signs of slowing down or becoming less profitable. It’s clearly by design! Businesses and agencies need to begin to rein them in.

According to these industry giants, there isn’t much they don’t know and can’t accomplish with digital advertising. But, ask any of them to guarantee something as simple as above the fold placement, where people will actually see an advertising message, and then all bets are off, unless, of course, you are willing to pay a premium for it. They have created their own self-serving guidelines, which mimics giving the convicts the keys to the prison. But don’t worry, they are all working on transparency! How do I know? They told me so!

There’s no dispute that the digital medium is powerful and necessary for a business to remain relevant into the future, but not at all costs! To be successful, your advertising should be a balance of strategically placed traditional and digital media, and its value should make it worth placing where it will reach all markets. It’s no different than making a good beef stew. You need a meat, various vegetables, and a little starch. Anything less than that and it will be a stew that looks more like potato soup!

In my next two articles of this four-article series I’ll cover how your company and the agencies need to independently and collaboratively work together to stabilize and strengthen their positions in the market with digital companies and the millennial generation.

Until then, I’ll see you around the water cooler app!

To read the next article in the series, “The Tail is Wagging the Dog,” click here.

Everyone talks about it and the industry is fighting it. So why can’t we find a way to stop it?

It seems that almost every week a new tool is introduced to combat ad fraud. But why, despite efforts to end the practice, does ad fraud persist?

Ad fraud is a type of scam in which phony online advertising impressions, clicks, conversions or engagements are characterized as authentic to generate revenue, despite the ads not being truly viewed or intentionally engaged with. While most ad fraud is thought of as nonhuman traffic created by “bots” (computer programs created to automatically click on a website or app simulating a human interaction), a significant percentage is generated by humans, intentionally or by lack of proper ad placements and tracking.

How big an impact does ad fraud have?

While estimates about the impact vary, it is believed that marketers are expected to lose approximately $16.4 billion to ad fraud in 2017. Incidents of fraud are reported worldwide with the majority of ad fraud taking place in the United States which has the largest advertising market and highest pricing for CPM (cost-per-mille) and CPC (cost-per-click), and now CPE or (cost-per-engagement).

How does it happen?

The digital medium is an ever-growing media channel, which creates new avenues to place ads as quickly as people can think them up and create a website, blog or app. Unfortunately, due to this seemingly endless expanse of digital ad options, attention to detail is often usurped by the drive to sell more ads and expand the current model. The “Fraud” happens when an advertiser is paying for an ad placement for a business, and the ad is either not seen, not seen long enough to create an impact, viewed on a site out of context for the product, delivered to the wrong potential demographic group, or only viewed by a “bot” set up to create false click through rates automatically.

Why does ad fraud persist?

There are many reasons that ad fraud continues to be a problem. One of the main reasons is the way in which ad success has been and continues to be measured.

Advertisers have been measuring their ad success since the first mobile ad was placed in 1994. While there are many tools available, advertisers have been relying on click-through-rates (CTR) and time-spent-on-page (TSP) as their primary metrics for ad success. Unfortunately, both CTR and TSP are easily replicated by bots and bot farms, making ad fraud a perfect target for criminals to cash in.

Ad fraud offers the prospect of high payouts with relatively little effort and a minimal risk of prosecution compared to other criminal pursuits. Also, the crime itself resides in a gray area of jurisdiction, making it difficult for law enforcement to prosecute. Combine those factors with the lack the technological know-how or resources of law enforcement to monitor, prevent or prosecute ad fraud, it makes it an attractive activity for cyber criminals.

One of the most surprising obstacles to eliminating ad fraud, however, is the disincentive from within the advertising industry itself to fix the problem. Though it would provide better performance results, eliminating fraud would result in fewer delivered impressions, which would as a result reduce ad profits. In addition, eliminating ad fraud could result in higher media prices and less inventory, making it more difficult and costly for small businesses to afford online advertising. So, fraud, in some ways, appears to “help” the industry, but in reality, it does not!

Not only is there a disincentive within the ad industry to eliminate ad fraud, industry insiders themselves have been caught taking advantage of the opaque monitoring systems by committing these acts. According to a Buzzfeed, a CEO of an ad platform and digital marketing agency was the owner of 12 websites that served as a network to defraud advertisers. Experts say that millions of dollars were stolen from over 100 brands including P&G, Unilever, Hershey’s, Johnson & Johnson, Ford, and MGM.

With so few internal ad industry incentives to do away with fraud, it is expected that at least half of the growing $72-billion-a-year digital marketing industry will remain fraudulent. Despite the prediction, some in the advertising industry remain vigilant to put in place strategies and measurement services to combat and minimize fraud.

“There are many preventative measures to stop ad fraud before it happens,” said Frank Gussoni President of A3. “Fighting ad fraud is an essential part of our obligation to protect our client’s money as if it were our own.”