More work to spend less money? | Benefits of Online vs. Offline marketing

The always useful Valleywag has an interesting post which looks at the problems the online advertising industry has in scaling upwards.

Apparently, $100mm get’s a client 1,500 purchased and tracked TV ad spots. For a frame of reference, $100mm is about one third of Facebook’s project 2008 revenue.

NeoAtOgilvy COO Greg Smith provided the following quote that encapsulates all that is good about online advertising and all that is bad about the traditional advertising approach:

“There’s a huge wave of data we’re not prepared to deal with.”

When I was meeting with the Friendly Ghost, Brendan Cooper in London, we talked about data as a good thing. As a valuable thing. As a way of demonstrating both Return on Marketing Investment (ROMI) AND Return on Investment directly to an organization’s bottom line.

Online Advertising

If you take a newspaper advertisement, or article, you can say that Xmm people had the chance to see that article (circulation x pass along rate = impressions) but you can’t say how many people opened that section, went to that page and actually read that article.

Online Advertising:

If you buy an online ad, you can be sure that, click fraud not withstanding, it will be seen by the number of people that you’re paying for. I bought 1mm impressions for a client a few months back and I know that 1mm people saw the advertisement.


What’s more, I also know that, on top of the 1mm who saw the ad, X per cent actually took action after seeing that ad and clicked through to the client’s site.

With the right analytics package, we can also work out how many people, who saw the advertisement, ultimately bought my client’s product or service.

I guess what I’m trying to say is that we now know which half of our advertising (or marketing) is being wasted.

Data is not here to tie us up and place us into a state of paralysis but to set us free from the worry that a campaign may not work – because the data can tell us what works. Once we know what works, what direction to take, we can work within those confines.

Agencies that have the capacity to spend less of their clients’ money but that do more work to show that they are spending it in the right places, will ultimately benefit from their clients’ permission to spend more of their money.

One Response to More work to spend less money? | Benefits of Online vs. Offline marketing

  1. ian says:

    Argh. Do you know how many times I’ve seen clients reduced to paralysis by data?

    You make a very powerful argument: If a client’s willing to throw $100mm at a TV ad, how can they hesitate to spend 1/20th of that on an online ad?

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