“The last bastion of unaccountable spending in corporate America” -Google CEO Eric Schmidt speaking of corporate advertising budgets.
The effectiveness of advertising has always been difficult to measure over the course of history, but no one questions its innate value. Calvin Coolidge once said “Advertising charges you with the high responsibility of inspiring and ennobling the commercial world. It is all part of the greater work of the regeneration and redemption of mankind.” Egyptians had no intention on putting financial metrics on the time or materials it took to display sales messages some 5000 years ago, nor did the Romans who touted their political campaigns on city walls. But at some point in time between papyrus and press releases, a person who was financially responsible for these messages demanded accountability.
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It has become one of the last remaining business expenses that is unable to be completely harnessed. Consider a billboard. The technology behind the billboard is as old as advertising itself, and will probably outlast social networking, subliminal marketing or any other type of advertisement idea that comes along the way. There will always be a facade that is unclaimed that could be used to hawk the next greatest product, and yet it gives one of the most vague definitions for ROI. Sure, you can pin ROI to advanced statistical regression models that explain the amount in sales increased over the duration of the sign with all other things constant, but even as statistical models become more defined you still avoid the asymptotic curve towards total reliability.
What Eric Schmidt and the rest of modern marketers are realizing is that with the advent of technology companies are given the opportunity to approach advertising with greater confidence in the overall success or failure of their projects. Google has redefined advertising by giving precise definitions of clickthrough rates and impressions which give the opportunity to be even more precise in targeting specific campaigns. Facebook is starting to grasp the idea of targeted marketing, and realizing the potential of pertinant banner advertisements to its 300 million plus growing community. Services like TiVo, and other DVR’s are analyzing metrics of commercials skipped, and shows watched. But with all this potential their is still a sense that it remains the beginning of an era of truly tailored advertising.
Consider again the case of the billboard. Consider a scenario where your new car drives by a billboard on the freeway and sends a signal that your car is within an area that would make it ideal to view the sign. These “impressions” would be able to see if you are generating enough traffic to justify the sign. If that weren’t enough consider it then uses eye tracking technology (which is already being used in cars to monitor optimal driving techniques) to send a signal to the billboard that your eyes were fixated momentarily on the sign. This information would be correlated to your browsing habits, whether or not you researched the product (i.e. your “clickthrough”) , and also to your purchasing habbits, online or via a credit card. These are all things 20 years ago that could not even be fathomed. Now we can measure the cost per view, cost per visitor, and cost per acquisition, all from a poster or billboard on the side of the building or highway.
Totally accountable advertising may be a mirage, but the tools to make ad campaigns more culpable are becoming a reality.
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