CMOs are on a continuous quest to maximize ROI by creating the perfect marketing cocktail of consumer demand. As former senior VP-global marketing at Activision Blizzard, I helped build billion dollar brands like Call of Duty and Guitar Hero through finding the right combination of brand marketing to drive consumer demand along with the retail or "pull-through" marketing to convert that demand to purchase.
Marketing is all about effectively and efficiently communicating a brand's emotional and rational benefits at the right time to maximize results.
However, the paid media channels brands utilize today to accomplish this objective are rapidly evolving and fragmenting. Mobile device adoption around the world is exploding faster than any media platform in history, presenting a huge opportunity for brands to reach consumers and create more impactful marketing.
So what would it look like if brands could harness the branding power of TV with the pull-through ability of direct response more effectively?
The Old Model: TV and Retail Marketing
Let's take a step back. Historically, the most effective strategy for brands to generate consumer demand and sales has been a combination of TV and retail marketing. TV gives advertisers the power of emotion -- leveraging sight, sound and motion -- to create demand and, when combined with brilliant creative, it's very compelling. BMW's current holiday campaign evokes the feeling of going home for the winter holiday while showing off a stunning looking car. Once that brand awareness and emotional connection have been established through TV, the brand runs retail marketing for local dealerships that incentivize consumers to take a test drive or get a promotional discount, thus connecting to the rational benefits or reasons for buying.
This combination of brand and retail advertising has worked for years, but today, it's not as effective as the past for two simple reasons:
1) TV advertising is losing its impact. Yes, it is still a great way to deliver content to a mass audience quickly. However, the real question is, "Are consumers actually watching my TV ads?" Research from Deloitte found that over 80% of consumers are doing something else while watching TV, and a lot of that "something else" is engagement on mobile devices.
2) Consumers are increasingly shopping online and on mobile devices. Just this week, we saw that mobile devices accounted for 37% of all online sales traffic over Thanksgiving, an increase of 36% year-over-year. Black Friday numbers were also up 7% over last year, with mobile sales driving the growth -- not to mention tablets are the hottest shopping items of the year!
The New Model: Mobile Video Marketing
Mobile is proving to be an extremely effective marketing vehicle for brands, solving the issue of weakening TV advertising impact together with giving consumers an opportunity to engage and make a digital purchase. Mobile content is richer than ever, and consumers are now spending more time consuming media on mobile devices than TV.
On a given day, some of the highest ranked mobile apps have daily active users that rival the audience of "Monday Night Football" and "The Voice," and taken as a whole, the addressable audience in the mobile app universe far surpasses TV. Keep in mind that today more than 87% of time spent in mobile apps is in the entertainment category (games, sports, news, music etc.) and social. These environments are extremely effective; they offer brands the opportunity to deliver video ads with the impact and emotional benefit of TV combined with a call to action related to the brand. That mobile call to action could be to purchase, watch a longer form video, promote a social action, drive an install and more. Net-net, it delivers the ability to encourage a consumer to act, engage with or buy a product. This scenario is a beautiful marriage of the power of TV's emotional impact with the pull-through ability associated with retail or direct response.
From Brand Advertising to Sell-Through
The mobile video opportunity for brands is here, and with it comes new ways to measure ROI and effectiveness. Top brands are getting excited about shifting away from panel-based research and moving toward big data to understand their audience and measure actual campaign performance. For mobile clients whose apps are their storefronts, advertising can be tracked all the way through to ROI. A brand can track how much it's spent per app install and compare this to the LTV (lifetime value) of that consumer to see if the spending drove positive ROI.
Marketers work tirelessly to get the right mix of owned, earned and paid media to drive sales. Mobile video offers the power of emotion combined with the practicality of direct response, a dream proposition for any CMO. At AdColony, we've built more than a mobile video ad network, but a true marketing platform, delivering HD video with impact combined with the ability to drive consumer engagement and purchase - a combination that I've found makes a perfect marketing cocktail of consumer demand.
We are in a new era of marketing; we can track spending directly to purchase in a way that TV never could and inspire action in ways that resonate with mobile consumers like never before. I look forward for the day when we can soon retire that age-old saying that CMOs don't know which half of their marketing is working. Mobile video is on the forefront of this new era of marketing, and I'm excited about a future where we can link all marketing spending to action, purchase and ROI with 100% certainty.