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BBDO CONNECTOCTOBER 25, 2013RECAPFIVE MAJOR CHALLENGESThe digital revolutionThe disloyal customerThe brand bubbleThe rise of private labelsThe growing irritation about advertisingRECAPADVERTISING IS DEAD. LONG LIVE ADVERTISING.Focus on the light buyerPenetration above LoyaltyThe two-step-flow of communicationTime for an ISPCreative is KingAGENDA1. Creativity in Advertising2. Word of Mouth3. Social media: Friend or Foe?

CREATIVITY IN ADVERTISING1

WHEN IT WORKSAND WHEN IT DOESNTREINARTZ (Werner), SAFFERT (Peter). Creativity in advertising: when it works and when it doesnt,Harvard Business Review, June 2003, p. 107-112. Tested on 437 TV advertising campaigns for 90 FMCG in Germany from January 2005 to October 2010

FIVE DIMENSIONS OF ADVERTISING CREATIVITY

OriginalityFlexibilityElaborationSynthesisArtistic value

WHEN USED IN COMBINATION, CREATIVITY HAS WIDELY VARYING EFFECTS

MOST EFFECTIVE COMBINATIONSORIGINALITY + ARTISTIC VALUEDove

ORIGINALITY + ELABORATIONMercedes-Benz

A EURO INVESTED IN AHIGHLY CREATIVE AD, HAS NEARLY

DOUBLE THESALES IMPACT

OF A EURO SPENT ON ANON-CREATIVE CAMPAIGN

DECREASES THE AIRTIME BUDGET

DOUBLES THE SALES

CREATIVE ADVERTISING

IS MORE CREATIVITY ALWAYS BETTER?When categories are associated with highly creative ads, adding more creativity do not always give a big boost

With categories associated with low creativity, more creativity is in some cases a good ideaWhen categories are associated with highly creative ads, adding more creativity do not always give a big boost.With categories associated with low creativity, more creativity is in some cases a good idea.

UNORTHODOX APPROACHES LESS REQUIREDWHEN PRODUCTS ARE FUNCTIONAL AND ORIENTED TOWARD CLEAR CONSUMER GOALS Bij functionele producten en producten met duidelijke doelen worden onorthodoxe ideen minder verkozenOUT-OF-THE-ORDINARY APPROACHWHEN PRODUCTS ARE EASILY UNDERSTOOD, SIMILAR AN TIED TO PERSONAL PREFERENCES

In tegenstelling tot begrijpbare, gelijkaardige producten en personal preference products, is het belangrijk om te gaan voor een out-of the ordinary approach.

WORD OFMOUTH2

TWO-STEP-FLOW OF ADVERTISINGDIRECTINDIRECTBrandOpinion makersConsumersAdvertisingAdvertisingWOMEffectEffectSource: adaptation of Lazarsfeld and Katz, 1955Het effect van reclame werkt overigens dubbel: er is een direct effect op de consument, maar is ook een indirect - nog krachtiger - effect via zogenaamde opinieleiders en benvloeders. Die opiniemakers halen hun verhaal en inspiratie op hun beurt vooral uit massamedia. Zowat n op de drie gesprekken onder consumenten over merken wordt rechtstreeks genspireerd door reclame, zo toont ook Belgisch onderzoek aan. In de meeste gevallen spreken consumenten onder elkaar positief over merken. Vooral gevestigde merken gaan het vaakst over de tong.

INFLUENCE OFADVERTISING ON WOMMORTENSEN (Neil). Tvs influence on word of mouth,Thinkbox, September 2013 (ONLINE) (www.warc.com)Used studies: of POETIC half a million data for 36 brands across three marketing categories retail, finance, and drink - and data from: Keller Fay, YouGovs Brandindex, Social media monitor Brandwatch, and data directly from brandsADVERTISING INVESTMENTSARE RESPONSIBLE FOR

72% OF ADDITONAL WOM

ON- AND OFFLINE(90 % OF WOM IS REAL LIFE)

THANKS TO TV-COMMERCIALSOn- & offline WOM lasts longer

47% more visitors on websites Ensures 52% of the positive impact on reputation

THE IMPACTOF WOMVAZQUEZ-CASIELLES (Rodolfo), SUAREZ-ALVAREZ (Leticia), DEL RIO-LANZA (Anna-Belen). The word of mouthdynamic: how positive (and negative) WOM drives puchase probability: an analysis of interpersonal andnon-interpersonal factors, Journal of advertising research, jg. 53, nr. 1, March 2013, p. 43-60. Data from a sample of 1035 consumers in 4 product/service categories,gathered in various shopping centers in northern spain

THE IMPACT OF WOMPositive (negative) WOM has a positive (negative) impacton the shift in the receivers purchase probability

Positive WOM is 14% more influential than negative WOM

THE IMPACT OF POSITIVE AND NEGATIVE WOM ON BRAND PURCHASE-PROBABILITY

The greater the sender strength of expression, the greater the impactThe more intense the receivers active search (high involvement), the greater the impactThe greater the loyalty with the brand, the weaker the impactThe receiver experience: the more knowledgeable people are or the more experience they possess, the less intense will be the active search for information (positive or negative WOM)

KEY DRIVERS FOR WORD OF MOUTHSenders are perceived as knowledgeableThe ties between sender and receiver are stronger(not significant for negative WOM)The receiver experience is low and perceived risk is high

WOM & ADVERTISING ARE TWO IMPORTANT COMMUNICATIONS CHANNELS THAT INTERRELATE AND COMPLEMENT EACH OTHER

SOCIAL MEDIA3

THE PERILS OF CO-CREATIONVERHOEF (Peter C.), BECKERS (Sander F.M.), VAN DOORN (Jenny). Understand the persils of co-creation,Harvard business review, September 2013, p. 28.According to an experiment led by Rajneesh Suri of Drexel University

LAYS - VOTE

#laysbe

#bbdoconnect

ETHIAS - BUURTFIKSERSBUT : HALFOF CO-CREATIONFAILS

EXAMPLE: MCDONALDSMcDonalds set up a Twittercampaign to promote positive WOM

It became a platform for consumers looking to bash the chain

THREE AREAS OF CONCERNStrong brand reputations might be put at riskHigh demand uncertainty: in highly volatile marketsQuantity, quality and variety decreases as the frequency of engagement increases

It can be viable:Monitor and intervene where necessaryHet behouden van sterke reputaties: dankzij co-creation kunnen klanten de reputatie van een merk vernielen. -Indien het over een nieuwe markt gaat (een markt die snel verandert) weten klanten vaak niet wat ze leuk zullen vinden. Dus er is een grote onzekerheid over de vraag. -Het is niet aangeraden om steeds dezelfde mensen ideen te laten aanbrengen. Want zo bestaat er het risico dat het idee gelijkaardig is met het vorige.

FRIEND OR FOE?SCHULTZ (Don E.). Social media: friend or foe?, in Admap, May 2013 (ONLINE) (www.warc.com)1.1 million consumer responses gathered in the US between 2002 2012, the data cover 73 store categories and more than 1500 individual brandsIT IS NOT THE MASS-MARKETING TOOLAS HOPED FOR

Advertising investments are responsible for 72% WOM on- & offline

TRIAL & TEST BEST APPROACH11% gives advice (average increase through years)30 - 35% has no brand preference Since 2008 the influence of Internet has raised, and the influence of traditional media declinedHigh correlation between no product brand preference and high social media use ->> NOG STEEDS GEEN ECHTE BEWIJZEN

SOCIAL MEDIA RED FLAGSIs it a powerful mass media form or just another niche media?Is it building preference and loyalty, or is it commoditizing the brand?Is the decline in consumer use of mass media, taking away the social value brands have created in the past?

CONCLUSIONS4

Creativity in advertising can double sales Look at the product and combine different dimensions of creativity. Originality + artistic value or + elaboration are the most effective ads

Paid Media drive Earned MediaAdvertising investments are responsible for 72% of additional on- & offline WOM

Social media work best with heavy buyersTrial & test: do not overestimate

QUESTIONS?VALUES TVC

Starbucks : 5 hours of pledging STARBUCKS - PLEDGEBBDO New York Starbucks47