The Importance of Being Measured

I’ve been thinking about brand measurement and agency research a bit recently. It strikes me that an industry, by and large, we are still predisposed to looking at basic outputs (how the creative treatment scores, or how many GRPs the media plan will deliver), rather than outcomes (what the ultimate effect of our work is). Our focus all too often falls toward the bottom of the below…

… whilst our (senior) clients are focussed at the top.

Of course, outputs are important: they are the first point of the advertising journey, they help benchmark work, and are essentially direct measures of our efforts. However, in the prevailing climate of shrinking margins, aggressive procurement, and the increasing importance of brand valuation on the balance sheet, a demonstrable display of the value that the agency (be it creative, media, or any other communications related company) is adding is vital – ie. an emphasis on business outcomes, highlighted at the top of the above diagram.

Ultimately, to be seen by a client board as a business partner, rather than a supplier, requires empirical evidence of worth (usually boiling down to a set of financial metrics). This means that as an industry, we need to be doing absolutely everything we can to be moving up the diagram above. Naturally, this requires an innovative approach to research – measuring our direct effect on the financial health of brands is a complicated area riddled with debate and conjecture. There’s no one simple solution, and as such, it’s up to us – as brand professionals – to be pioneering new ways to achieve this through exploring experimental and developing areas of measurement. But…

I believe there are two key things that are preventing us from doing this.

(1) Finance (short-term inertia)

The inherent problem with changing an established system (usually by speculative work and investigating new routes) is the investment that is required, both financial, and in time. At a time when margins are being squeezed, it is often difficult to do more than is directly essential in the day-to-day running of a piece of business (and within the ‘doing more’ camp I include embracing new trends and developments in brand measurement).Few agencies undertake wide-reaching brand valuation exercises or investigate new ways to help measure our business impact (although there are some notable exceptions) for the these reasons. This result is that it can be very difficult to justify innovative or speculative research work internally, and although this is a disconcertingly short-termist view, it is one that often prevails.

(2) Attitude to Measurement (long-term inertia)

The second problem that we encounter is the attitude to measurement as a discipline, amongst both marketing clients and, in some instances, agency staffers. Far too often brand measurement and evaluation is seen as ‘an optional extra’ or a ‘nice to have’ – a discipline that we should tap on ad-hoc, perhaps when a personal promotion needs sealing, or when there is particular scrutiny on a campaign.

It seems to me that the current model all too often follows a very simple, linear path:

measurement = optional = non-essential

Although we often claim to recognise the importance of measurement, as long as it is an optional, incremental service, it will be too easy to be judged as being non-essential. Furthermore, even when it is utilised, it is unlikely that we will regularly stretch our practice and thinking outside of the ‘comfort zone’ (ie. basic outputs).

As long as agencies continue to treat evaluation as an ‘optional extra’, we will find it extremely tricky to fully explore new and better ways to measure our work. We risk being stuck as experts of the output – the day to day measures – whilst our clients turn to others to discuss and advise on the meatier business issues.

I believe that one possible solution is to cement brand measurement within our contracts with clients (both as something we offer, and as a means of payment). Some agencies are bold enough to be remunerated on the performance of their clients’ brands, but I feel that this needs to become the rule, rather than the exception. On top of this, I think that we need to start including brand measurement as a core offering to clients as opposed to an add on (ie. built into contracts as de rigueur – if you sign up to us you sign up to our measurement… obviously incentivised and pitched in the right way! ) . The benefit is twofold: raising evaluation up the agenda, and having a regular stream on investment going into our research teams to help them develop ground-breaking new ways to help demonstrate our worth.

It’s a big ask – and probably in lots of cases hugely problematic – but by doing this we can begin to take huge strides forward not only amongst our direct competitors (the IPA claims: “effectiveness has to be one of the bases for demanding a premium versus every other agency promising greatness”) but critically, in the boardrooms of our clients.

That was a bit of a ramble. Sorry. But hopefully you broadly get my jist. Any thoughts? Is this feasible? Do we actually need to change the way agencies measure brands at all?

NB – above figure reproduced from Advalue

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6 Responses to “The Importance of Being Measured”

  1. Greg Says:

    Interesting post Doug. Measurement is hugely quantifiable if we are talking about advertising “space” and the various currencies that exist do a decent job. The progression of touchpoints etc also shows that the industry is reacting to the needs of the bigger clients.
    However as more and more agency work becomes consultancy based it becomes very hard to measure the worth of knowledge . For example a piece of advice you give a client that guides them on a new direction that eventually leads to increase sales. Very hard to directly relate back to a particular conversation. Perhaps

  2. Doug Says:

    hello mate

    that’s my point exactly. it’s difficult – and that’s why we need to invest to undercover new and better ways to ‘measure the unmeasurable’. but with the status quo as it is, it’s really hard to push the boundaries and develop new methods (which will give us a leg up the business respect ladder!).

  3. Gagey Says:

    Something I’ve been thinking is that in evaluation, we get overly obsessed with trying to disaggregate the comms effect – was campaign A better than campaign B, was ad 1 better than ad 2? was press better than radio? was weekend better than week. This is derived from media agencies obsession with having some sort of measure of the ‘perfect’ plan. Or creative agencies trying to prove that the latest bit of creative work is better than the last (thus justifying the trip to the Seychelles)

    So when we think about evaluation we try and think about all of these aspects and how they might affect the bottom line / share price… Which kind of makes my head explode when I try to think how it could be done (& I’m not bad with evaluation).

    So to get further up the chain and really deal with the bottom line, we need to simplify it.

    i.e. did the WHOLE thing (idea, creative, media, message, timing etc.) work?

    By focusing on (just!) that we might get somewhere rather than losing ourselves in debates about which constituent part seems to be working / not working.

    But I agree evaluation should be part of the whole fee. But there is always the challenge of marking your own homework… But no-one can truly be independent.

    What are the options:

    1. Mark your own homework?
    2. Agencies ‘swap’ homework to mark (i.e. WPP business analyses Omnicoms) – very difficult to make happen!
    3. Clients do it in-house and agencies focus on what they’re good at – ideas, creativity, planning. But will clients do it properly?
    4. More independents

    Mmmm. Not sure? Thoughts anyone?

  4. Vando Says:

    Good post Doug, and thanks for your comments over at the Recliner too.

    From a client perspective, I’d always be inclined to keep the research independent.

    Where the agency would come in really useful is, being the experts in advertising, helping the client and the agency understand the best way to research the ad/campaign. A good planner here is priceless.

    I would employ an agency on their ability to produce really effective advertising, to fully understand the target market, and build the right brand profile over time.

    If they failed at this, but were great at research, they’d probably get the boot.

    If a client sees measurement research as being optional, that suggests to me that they’re probably not great marketers. Which means that in this case, it may be better to utilise other methods to keep the client happy. As you suggest, perhaps involvement in solving other business problems.

    More proposed solutions, less proposed research.

    Anyway, just some random thoughts. Well done on 100 posts by the way!

  5. Lee McEwan Says:

    Hi Graeme,

    I would hope that you’re largely preaching to the converted.

    In my experience most agencies do already recognise the obvious value of working with their clients to demonstrate the return on their advertising investment.

    However, as Vando points out, few clients are keen on entrusting their agency with the role of evaluating the impact of creative work. This should be left to independents.

    Where we can help is by actively supporting the measurement of effectiveness by ensuring that clear and precise targets are set in advance (much harder than it sounds) and that we help our clients to engage appropriate independent specialists and brief them in as partners from the start.

    Sadly, IMHO this doesn’t happen as often as it should because of …

    1) FEAR OF FAILURE — many brand managers (and agency teams) prefer not to set strict objectives for their campaigns unless someone further up the food chain is insisting on it because to set an objective is to risk failure

    2) MONEY — linking the impact of advertising to higher order metrics like shareholder value (or even profit) is (relatively) expensive and it is often argued that the money would be better spent elsewhere

    3) SKILLS — many clients and agencies lack the expertise to properly engage with the complexities of the task of evaluating advertising — most would not know if the advice they are getting from independents is bogus or not (the IPA are working hard on this one but it also requires investment in clientside and agency skills)

    4) TIME – the real impact of advertising takes a while to filter through and so many marketers prefer to rely on a more timely measure from a pre-test that is (apparently) correlated with in-market performance

    5) BELIEF – whilst subscribing to the view that it is valuable to demonstrate the impact of advertising, many practitioners do not believe that the current tools truly reflect the real value of their work and therefore pull back from such attempts at “marketing science” altogether

    Given the barriers, I always see each and every IPA Effectiveness submission for what it is – a Herculean effort for all involved.

    So in summary, I don’t think we should be insisting that clients pay us to evaluate work. However, we are unlikely to see a breakthrough in advertising evaluation methods unless both clients and agencies engage with the problem and invest to solve it.

    Oh, and one final comment to stir things up a bit .. just how independent and objective are those WPP research agencies?

  6. Doug Says:

    Vando, Lee,

    Thanks for popping over.

    I can see that many clients do see a conflict of interest – “marking your own homework” can always be seen as a problem

    I suppose my worry is twofold:

    1 – if we (client facing agency planners/account teams) don’t (or can’t) engage in conversions about business effectiveness, as well as creative/media outputs, then in the long-term, we’re in trouble. many in the industry are great at it, but I’ve met far too many that aren’t, and frankly that concerns me

    2 – to be able to achieve the above, i feel that we need to continuously be pushing research boundaries, experimenting with new techniques, and generally championing the discipline of measurement. again, whilst loads do, many don’t. in order to get things moving forward, we need cash and time to do this. wrapping evaluation up within our core contractual offering is one potential solution…

    … but the more I think about the impartiality argument, the more of a problem I can see it being. Personally, I know that if my agency undertakes an evaluation project for an existing client, the work is completely standalone and not influenced one iota by any other department. But from an external point of view, it’s always tricky to overcome a perceived conflict of interest.

    an interesting (and enormously important) area indeed.

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