Artificial Intelligence vs. Genuine Creativity

Will Artificial Intelligence replace Creativity?

No, but it might help it, in a roundabout way.

What is AI? What can it do?

Nearly all AI work today is based on successes in machine learning. Think of machine learning as having enough data and enough processing power to think through analyses that would take humans too long to do. Imagine a mountainous, time-consuming task that needed to be done, however slowly.

Here’s one example. For half a century, scientists have been mapping the three-dimensional shapes of proteins that are responsible for diseases like cancer and Covid-19. They refer to this mapping as “unfolding,” and doing it for just one protein takes a long time and a lot of money. Up to now they’ve “unfolded” only a fraction of the 200 million known proteins. The work done so far was recently fed to an AI program called “AlphaFold” which used it to do decades of work all at once. The results have been published online for review by the scientific community.

Did AI cure any diseases? No, but it advanced the work of scientists trying to do so.

Can AI advance the work of creativity?

How to approach AI

Some AI experts will tell you to approach AI with three questions in mind:

1) Is the task genuinely data driven?
2) Do you have the data needed?
3) Do you need the scale that automation provides?

On that last question: If you have a decision that needs to be made more than once per minute, then yes, you need the scale; if you have a decision that needs to be made only once per year, then probably not.

Does creativity answer “yes” to all three questions? What kind of creativity are we talking about? A painting, a sculpture, a novel? An advertisement? Let’s focus on advertising for the moment.

Advertising, Big Data and AI

We can’t say the task of creating ads is “genuinely data driven.” Sure, advertising ideas for a particular client or project may entail data or feature a data point, but even that isn’t a matter of computation. Nor is the task so routine that we create ads at a rate of more than one-per-minute. (OK, it feels that way sometimes.) Variations on an ad, however, might drive that kind of scale. Personalization of ads, for example, might be accomplished with AI that considers not only the recipient’s name but their past purchase history and other data. That’s already happening in most online marketplaces, and don’t forget that direct mail is personalized. But these are all variations on an ad created by humans.

It's a protein,
not a creative brief

There have been attempts to create at least one kind of advertising with AI: movie trailers. The first experiment was back in 2016: someone wrote a program, based on consumer reactions to movie trailers, that could lift scenes from a movie and sequence them in 30 seconds that would effectively convince people to see the movie. Judge the results for yourself and see here a more recent experiment from 2018. More recently, Netflix invested in technology to automate trailers for their content, while adding personalization for its subscribers, which makes sense for an individualized setting like your Netflix account.

Setting aside the irony that movie trailers are already quite formulaic, we see that AI made an ad. But does anyone really think that the studio marketing head won’t ask the machine for revisions? What about the movie itself? Could AI create a full-length, cinematic feature?
 
This may depend on one’s world view.

Keep AI in perspective

AI can certainly enable a human being to see new possibilities. For example, large amounts of data may help us predict future changes in consumer behavior. Knowing these possibilities may lead to a new insight on how to position a product or service. There’s great value in AI when it comes to aiding our thinking process. It can give us insight that inspires creativity. But that creativity is human, not artificial.

At an AI conference, a very intelligent professor of computer science said, “There’s no aspect of human cognition that can’t be modeled on a machine.” At the next break, I sought him out to learn more. He explained his world view that humanity – the human mind – is essentially physical, part of the physical world, and therefore can be modeled. Yes, he explained, machines will gain the ability to make cinematic features when AI develops enough to mimic every function of the brain. I asked, does it follow that humans are essentially machines? Incredibly, he said, “Yes, that’s a fair statement of how I see it.”

I see it differently. Creativity takes judgment, and human judgment comes from each person’s uniqueness, and their interaction with other people’s uniquenesses, to create something with passion and imagination. Perhaps, like me, you believe that we are more than machines. We have a spirit, a soul if you will, that animates us and gives us the ability to create sculptures, novels, choreography, and advertising. No machine can ever replicate that.

Book Review: If Then by Jill Lepore

If Then: How the Simulmatics Corporation Invented the Future

By Jill Lepore

Liveright Publishing, 432 pages

The guys who invented predictive analytics never saw failure coming.

That’s the upshot of Jill Lepore’s latest book, If Then: How the Simulmatics Corporation Invented the Future. 

Ostensibly, it’s the story of Simulmatics, founded in 1959 on the idea that with enough data collected in one place, everything and everyone would become predictable. The name is an attempted portmanteau combining the words “simulation” and “automatic.” You’ve probably never heard of Simulmatics because it folded in 1970, but during its short history it played a role in electing John F. Kennedy, mismanaging the Vietnam War, seeking answers to 1960s social upheaval, and speeding the presence of mainframe computers at advertising agencies.

If Then: Book Summary

The founder of Simulmatics was Ed Greenfield, a midcentury ad man, but not like Don Draper. Lepore delightfully introduces him: “He was like a ten-million-volt Looney Tunes electric magnet, a giant red-handled iron U that pulled everyone toward him.” His personality, his ability to influence others, was what propelled him. As evidence, the story includes a lot of bold-faced names, especially from Democratic Party politics, which is what Greenfield cared about most.

Indeed, he built an impressive team. Lepore introduces the other main players early, and efficiently. Harold Laswell, the influential communications theorist. Eugene Burdick, novelist and self-styled adventurer. Alex Bernstein, mathematician and computer programming pioneer. Ithiel de Sola Pool, a social scientist specializing in technology. Bill McPhee, a FORTRAN programmer – and this is such an emblematic aspect of the story – who wrote “the core intellectual property” of Simulmatics while he was committed to Bellevue. Yes, a mental hospital.

Punchcards
on parade

Like any startup, the group had big plans. They bragged they had invented “the A-bomb of the social sciences.” They called it a “People Machine” that could predict the outcomes of advertising campaigns and government policy initiatives. Sadly, they couldn’t get out of their own way. They overplayed their true role in JFK’s winning presidential campaign of 1960. They overpromised how they could help the New York Times analyze the 1962 midterm elections in real time. They overestimated, tragically, how Western-style social science techniques could understand Vietnamese culture. They oversold their value to blue chip brands but opened the door to a legion of market research providers still selling soap today.

One gap in the story: What projects did they actually finish? The only projects fully described were the political ones, and there was only fleeting mention of having sold studies to various corporations, like Bristol Laboratories, Philip Morris, P&G, and some others. Simulmatics was always starved for data, so most of the projects had little effect. Still, it would have been interesting to read more about those episodes.

Eventually Simulmatics folded, although some of its work survived in projects undertaken by individual team members, thus laying the groundwork for today’s data-driven marketing. They accomplished just enough to push things forward, but not enough to get pinned with credit or blame for what we have now. Oddly, Simulmatics’ most accurate predictions came not from data but from the very human insights of Ithiel de Sola Pool. He envisioned with eerie accuracy the role of technology in our lives today: the interconnectedness of the World Wide Web, the ubiquity of social media, and the rise of “mobile computers,” today’s smartphones.

Why Simulmatics matters now

Lepore’s book is thoroughly researched and well-written. It’s a solid history, which is why Simulmatics matters: because we learn from history. Here’s what I took away:

• No data. It shouldn’t have been surprising, but was nevertheless shocking, how Simulmatics never seemed to have data that were complete or accurate. In an almost poignant moment, Lepore writes, “Pool raised the question that Simulmatics would never really answer: ‘What is the data we would need for this model?’” Ad agencies, which had data, filled the gap, bringing in their own IBM mainframes and offering the services to clients directly. Today we have plenty of data, but we still have to answer the question: Which data do we need to solve this problem?

• No humility. The Vietnam phase of the book is a troubling read. Defense Secretary Robert McNamara in 1962: “Every quantitative measurement we have shows we are winning the war.” That might have been all too true; Lepore points out that military progress was measured by “the number of insurgents killed,” with the implication that indiscriminate killing ran up the numbers. Humility is a function of introspection. Are we thinking things through? Are we seeing the big picture? Are tracking the right metrics? These questions are relevant to the work we do today.

• No humanity. Lepore points out that computers can simulate a flight because physical laws like F=ma are constant. “But the computer simulation of human behavior … is much more difficult. Behavior is not a law.” If, as some Artificial Intelligence experts say, the brain is just a very sophisticated machine, then eventually we will create a machine that can think like a human brain. But there is a (so far) unquantified human element that no series of If-Then scenarios in FORTRAN, C++ or Python could ever predict.

Simulmatics failed where other succeeded. There’s still lots of room for modern failure, which is why these lessons from the past are important.

What is Ad Majorem?

Thank you for visiting my blog, Ad Majorem.  When it started in the late 2000s, it was a view on modern marketing from within a large advertising agency.  Now it’s a view on modern marketing from the perspective of a CMO.

The title, Ad Majorem, is part of a familiar Latin phrase and loosely translates to English as “to the greater.”  As in, there is always an opportunity for better marketing: stronger consumer insights, more powerful ideas, channel-neutral marketing plans, and accountability so we know what sells and what doesn’t.

 

There’s also always an opportunity for better marketing people.  It’s important to me that team members keep learning as they go, staying curious and maintaining a perspective of continuous improvement.  We’re happier when we’re learning and growing, so that will continue to be a theme here.

The “ad” in Ad Majorem means all marketing communications, from social media to direct mail to Internet gaming to television commercials. To most consumer audiences all of these are advertising. My professional experience

in these channels provides a perspective that is part specialist, part generalist.

A lot has changed since 2009, not all of it “to the greater.”  We’re at a very inauspicious moment, with uncertainty, threats, deepfakes and divisions.  This blog has always avoided politics, and will continue to avoid politics, because there are too many wannabe pundits in marketing and advertising already.

That said, there’s always hope for the future, so the tone here will be hopeful as well as honest.  Don’t come here for dirt, fear or loathing. The closest I’ll come to that is self-criticism of the marketing business. Occasionally I’ll stray into a review of a campaign but only in service of a larger point.

Please comment. Otherwise this wouldn’t be an honest look at an industry where communication with consumers should be two-way, not just one-way.

One thing hasn’t changed since I started this blog.  Ad Majorem’s reason for being is to keep myself honest on embracing the challenges and changes of modern marketing. My hope is that you, too, will derive some professional growth from it.

Greetings from Startup Land

Which one delivers results?

This past month on Ad Majorem I've described in a series of posts how I went from Ad Land to Startup Land.  My hope is that you found it interesting or helpful or both.

There are a lot of differences between the two worlds.  I'd argue that one big thing Startup Land can teach Ad Land is how Technology and Marketing can work together.

One big similarity?  I've seen that whether you're in Ad Land or Startup Land, the only way to create real value is to focus on delivering results.

Here's an index to the whole series.  Thanks for reading.

How I Went from Ad Land to Startup Land

Startup Land Has No Boundaries

Startup Land, Where Technology and Marketing Work Together

In Startup Land, Management Really Is Nimble

Results Also Matter in Startup Land

Book Review:  Quick and Nimble

Book Review: The Signal and The Noise

The Signal and The Noise:  Why So Many Predictions Fail -- but Some Don't

By Nate Silver

Penguin Press, 534 pages

Can you go to jail for promising your client great results?

Ask the Italian seismologists found guilty of manslaughter for underestimating the risk of what turned out to be a magnitude-6.3 earthquake that killed over 300 people.  They're one of the cases analyzed in The Signal and The Noise, a new book about successful and failed predictions.  Advertising isn't (usually) a life-or-death matter, but it is a major line item on your client's P&L.  You might not go to jail for a bad prediction, but you could get fired.  That's why I recommend this book:  It helps us understand the impact of so-called Big Data in marketing today.

The Signal and The Noise: Summary

In electrical engineering, “Signal to Noise" describes the relationship between signals that report a useful reading and random noise that makes signals hard to identify.  Similarly, as we drown in data, generating 2.5 quintillion bytes every day, it's harder to separate signal from noise.  Compounding the problem is our own subjectivity:  human beings, more than any other species, are wired to see patterns, and often in the data we see patterns that aren’t real.  Worse, we use those non-patterns to predict future events.  The solution is to embrace our subjectivity and test hypotheses, getting “closer and closer to the truth as we gather more evidence.”  Examples are drawn from pro baseball, politics, earthquakes, economics, epidemics, gambling, global warming, and terrorism.  The author, Nate Silver, knows whereof he speaks.  Years ago he built a reliable tool forecasting baseball player performance, and later gained wider fame for correctly predicting the state-by-state results of the last two presidential elections.

True to the topic, Silver’s analyses are sincere and (generally) objective.  It’s not the type of book, however, so common on the business shelf, that outlines 7 key findings or 10 ways to improve your predictive power.  In fact, buried on page 195 in one of the most hopeless cases – economics forecasting, which will destroy whatever confidence you had left in economists – are what I saw as his three keys to success:  (1) Improved computer power, (2) Better data collection, (3) Old-fashioned hard work.  Comically in a book that keeps reminding us that “to err is human”, there are some unfortunate typos like this one on page 379, quoting a NASA climate researcher:  “I finally realized the definition of rocket science is using relatively simple psychics to solve complex problems.”

Why Advertising people should read The Signal and The Noise

The book is relevant to marketing today because we have far more data than ever and, increasingly, the expectation that we can predict results.  If you think about it, our day-to-day decisions are predictions about what will succeed.  We launch that new product (and hope it isn’t in the 90% that fail this year).  We choose those three animatics for test (and pray that one of them scores).  We buy this medium over another (and look for which half of the ad budget we wasted). 

Silver points out that Prediction and Forecast are two different things.  A prediction is definitive, e.g., "this new product will achieve $60 million in Year I sales."  A forecast is probabilistic, e.g., BASES may tell you Year I sales within a +/- 20% range.  This once frustrated a CPG CEO who didn’t realize how his brand managers were jacking up the assumptions that went into the company’s BASES forecasts.  Of note, the U.S. Geological Survey explicitly states they can’t predict earthquakes – they work hard (and fruitlessly, to hear Silver tell it) to forecast earthquakes’ probability.  (Small comfort to Italian seismologists.)

Likewise there’s a difference between Risk and Uncertainty.  Risk is something you can put a price on, a calculable estimate.  Ipsos/ASI may report a persuasion score as having an 80% or 95% level of confidence.  That means there is a 20% or 5% risk the copy won’t be persuasive.  Uncertainty is risk that is harder to measure.  Silver’s example is the gross miscalculation by credit ratings agencies as to how risky collateralized debt obligations really were.  (The chapter on the 2008 financial meltdown, “A Catastrophic Failure of Prediction”, is worth a read if only to understand that fiasco in 28 simple pages.)

Three Lessons for Marketing and Advertising

All data is not created equal.  Silver admits that some things are easier to predict than others.  Baseball happens to have a rich set of data, whereas predicting earthquakes is virtually impossible because we can’t actually observe and record the subterranean shifting of tectonic plates.  The same lesson has historically separated direct response (did version A or version B have a higher response rate?) from advertising (which half of the budget am I wasting?).

Calibrate your crap detector.  The book is a treasure trove of ways we should not interpret data.  You’ll cringe at some of the mistakes – and realize you’ve made some of them yourself.  One of the more intriguing discussions is about “unknown unknowns” – what is it we don’t see because we would never dream of it?  Which leads to my last point.

Use your imagination.  We’re human and our subjective POV is inevitable, so why not use it? 

Silver’s personal template for prediction is called Bayes’s Theorem.  It’s essentially a way to apply the scientific method:  observe a phenomenon, develop a hypothesis to explain it, formulate a prediction from the hypothesis, and test the prediction.  To be clear, this is not a left-brain analysis that a computer could perform.  It requires human imagination.  Computers just help us calculate the possibilities.  

In other words:  It’s up to us to distinguish signal from noise.

Check out another Ad Majorem Book Review, The Shallows by Nicholas Carr.

Facebook and the Conundrum of Mobile

A Bronx cheer from the New York press

If you bought Facebook at $38 a share, I’ll offer you some hope for the future.


But if your eyes glaze over when hearing about audience measurement, then skip today’s post.

Facebook went public, then publicly flopped

The two topics are linked. This past week Facebook went public and then publicly flopped. You may have gathered from news reports the following causes:

(a) CEO Mark Zuckerberg pushed up the price too high

(b) Morgan Stanley mishandled the transaction

(c) Nasdaq’s technology failed

All three to some extent are true.

What really started the entire affair was audience measurement.

Audience Measurement flummoxed Facebook

Facebook dominates the online advertising marketplace. Over the past few years it’s grown to be about 60% of the market. For the most part this advertising is measureable because Facebook controls the inventory, distribution and analytics. If you spend money to advertise on Facebook, you generally know who you’re reaching and how they’re responding.

The audience data for mobile usage, however, isn’t so certain. The technology just hasn’t developed yet. Reuters noticed this fact and wrote about it, calling into question the projections of Facebook’s future advertising revenue. Since their source was Facebook’s own SEC filing, this wasn’t exactly an exposé but it was a total buzz kill.

This week’s events don’t necessarily put Facebook on the same path as MySpace and Friendster. It still makes billions on the ads it sells.

Facebook and the Conundrum of Mobile

Still, Facebook symbolizes the Conundrum of Mobile: Consumers have adopted, embraced and depended on it, but advertisers haven’t yet found their role.

The answer to the conundrum is: Advertisers’ role will increase as measurement becomes more certain. And it will.

So, hang on to your Facebook stock. When they figure out mobile, the share price will go back up.*


* Obviously, I'm not an investment advisor, and this post isn't investment advice.  I didn't buy any Facebook stock, so it's easy for me to opine.  That said, my opinion is less about Facebook's future than the future of mobile audience measurement, which can only get better.

More Unusual Overlap on the Gigantic Venn Diagram

Often on Ad Majorem we discuss the Gigantic Venn Diagram, a concept that captures how the media landscape continues to change all the time and how consumers use media in a lot of different combinations.

This morning I’d like to direct your attention to a good article that should have been datelined from “An Unusual Overlap on the Gigantic Venn Diagram.” No, not The Twilight Zone. The QR code.

Yes, the QR code. It’s been criticized for a number of reasons, mainly due to its misuse by clueless marketers who insist on putting it in useless places like 30-sheet billboards along major highways.

David Henkel points out, however, that a QR code can be an effective direct mail tactic. Now that U.S. smartphone penetration exceeds that of feature phones, it's easier to imagine someone using a QR code to get more information about the product or offer they see on a piece of paper.

I hasten to add that like all technology, QR codes are not a solution unto themselves. Consumers will only respond to them if marketers communicate something relevant enough to cause a response.

So, here’s an overlap on the Gigantic Venn Diagram to think about: Direct Mail, Mobile, and Websites. It hits all of the Three Ds (Digital, Direct and Data) but better still, it recognizes how consumers use media.

Thanks to my colleague Patrick Moorhead for pointing out Henkel’s article.

3 Reasons You Should Care About the BzzAgent Acquisition

Last week Boston-based BzzAgent, a word-of-mouth marketer with extensive analytical capabilities, was acquired by dunnhumby, a direct-response marketer, also with extensive analytical capabilities, that in turn is also owned by U.K. retailing giant Tesco. (American readers should know that dunnhumby works extensively in the U.S. with Kroger.)

Bzz you should notice

I’ve worked directly with BzzAgent, and it’s always been a great experience. The starting point of their capabilities is a network of some 800,000 Bzz agents, consumers who receive product samples from manufacturers hoping to generate positive word-of-mouth. Just search on Twitter for #ImaBzzAgent, #BzzAgent or @BzzAgent to see the conversation they drive. As their CEO Dave Balter has pointed out to me in the past, BzzAgent is more than a network of “advocates,” they truly understand social media and analytics.

To oversimplify a bit, BzzAgent is great at driving consumers toward brands, and dunnhumby is great at closing the sale at a particular retailer – which is also known as shopper marketing. This is a powerful model for manufacturers and retailers alike.

3 reasons you should care about the BzzAgent acquisition

1. Shopper Marketing holds Social Media accountable. As Balter put it in an interview last week, social media “is still in the world of ‘likes’ and clicks, but substantial budgets just don’t come from that. Shopper marketing, on the other hand, is the ultimate measurement vehicle. It’s a thousand percent about ROI.” Yesterday someone posted on Ad Majorem that social media is just media, not necessarily an advertising vehicle, and they’re right if no one knows its effect on sales.

2. The path to purchase still ends at bricks and mortar. I’ve posted before that Social = Mobile. If you accept that premise, and observe that shoppers carry mobile devices into stores, we can also say Social = Retail. Apple and Google mobile platforms offer plenty of apps for looking up product information. Twitter is a secondary market for online coupon offers. At some point the cash register rings and its usually at a physical store.

3. There’s a trend forming. Not only did dunnhumby acquire BzzAgent but Walmart acquired Kosmix, which for lack of a better term we’ll call a “social commerce” platform. Read more about Kosmix here, here and here. And then there’s Groupon, which is also a blend of social media, shopper marketing and e-commerce. In short, retailers are figuring out how to harness the power of the Internet.

Perhaps now someone will figure out foursquare’s reason for being.

Hyper Island II: The Network

NEW YORK – Every day at Hyper Island starts with a “morning reflection”. You get a chance to stop, consider what you’ve learned and how to apply it. Then you share insights in group discussions. It’s mandatory to take a lot of notes, which I’m repurposing here as a blog post.

Networks are the Base Unit of Communication

I learned a lot on Day 1 but the one thing that most changed the way I think was the concept of Networks. Your Network is the list of people you choose to read, listen to, and interact with.

Our lecturer, Mark Comerford, said this: “Networks are the base unit of communication. If you don’t reach the Network, then you don’t reach me.”

That was a radical idea for me, not because of my experience with mass audiences, but because I made a mental shift some years ago from mass audiences to one-to-one communication. My newer paradigm has been that Digital, Data and Direct all work together, allowing us to engage people in ways relevant to them, and measure the results.

In a bit of self-analysis, I realized that I had seen each individual person as their own gatekeeper – and that is true, by the way. What I had been missing is the fact that each individual person relies on their Network to be a gatekeeper. The implication for marketers is to figure out how you are going to offer something of value to these Networks.

That value is what matters to the Network of people. The currency of the Network is stuff that’s interesting to its members.

What My Network Taught Me This Morning

After a few minutes of journaling, we sat in a circle – a Network, if you will – and shared our insights.

My good friend and colleague, Terry Corrigan, shared something that anyone coming from a traditional ad agency background, big or small, would want to hear.

Terry observed that “the digital space isn’t about selling, it’s about being useful.” Many of you know this. He went on to describe how “being useful” builds brand equity.

Many traditional agency people and their traditional clients think about brand equity as a function of the TV advertising. What we say, how it looks, what products we choose to advertise – all of these contribute significantly to a brand’s equity.

The same applies to digital programs. Best Buy’s Twelpforce and Zappos customer service build brand equity. Motrin’s ignorance of the space hurt their brand equity. Brand equity is your reputation.

This point is significant because many clients ask about the ROI of Social Media. Instead of dissembling because we don’t know how to calculate the ROI, we should make the impact on brand equity part of the answer.

Time again for lunch. You can follow our Hyper Island Master Class on Twitter by searching for the hashtag #HIMC.

Modern Retail is Full of Caveats, Part II

Earlier this week we posted about DecorMyEyes, an online seller of designer eyewear owned by Vitaly Borker. The New York Times reported how Borker purposely angered customers who complained, so they would complain online and drive up search engine rankings for his business. It seemed to be working.

You can't beat the Algorithm

Apparently, Google was not amused by all this, and announced Wednesday that they had adjusted their algorithm to screen out merchants that "provide an extremely poor user experience."

It was a good, but possibly unnecessary move, as Borker's strategy may not have actually worked in the first place. According to Search Engine Land, you can't rank well just by cultivating terrible reviews. Google, however, didn't take any chances.

Direct Marketing will continue to influence advertising

Last night the Chicago Advertising Federation honored Howard Draft with its Silver Medal Award for lifetime achievement, which honors contributions to the local ad community as well as the community at large. The venue was a large dinner at The Drake Hotel and it was fantastic to see a lot of people I’ve worked with over the years.

Howard has obviously achieved a lot, including a series of agencies with his name on the door, which was a running joke throughout the evening’s remarks. It’s not all chest-pounding, though; Howard’s myriad agencies have been very successful. (Full disclosure: If you didn’t know, I work at Draftfcb.)

Direct Marketing in the Past

Most of Howard’s agencies were of the direct marketing variety. Back in the day, “Direct” had always been a little too scientific for most of the big ad agencies. Only David Ogilvy called it his “secret weapon”. The other agencies knew it was powerful, but as Rick Fizdale said last night, “What I knew about Direct could fit in a thimble.”

Fizdale, former Chairman and CEO of Leo Burnett, told the story of how he led an effort to acquire Kobs & Brady, the 1980s powerhouse Direct agency, and in the process met Howard for the first time. The acquisition didn’t happen, and I would never do justice to Fizdale’s version of the story, so I won’t try to retell it here.

One line of the speech is worth pointing out, however. Fizdale referred to “The advertising I practiced and the advertising (Howard) had mastered.” He was comparing traditional brand advertising and Direct Marketing, but what I loved about this line was how casually and naturally he declared both disciplines to be advertising.

Direct Marketing in the Future

Howard, in his acceptance speech, told how he failed to get a job at an ad agency when he was first starting out, and instead landed at a Direct agency. “I firmly believe,” he said, “I wouldn’t be here tonight if I hadn’t gone into direct marketing.”

This is true for a couple of reasons. One is that Direct allowed him to be the entrepreneurial guy he is, outside the stultifying structures of most traditional ad agencies. The other is that he prepared himself for the turn-of-the-century shift toward accountability in marketing. Direct had always been accountable.

This trend will continue, unabated, for as far as any of us dare predict. We’ve posted before about Direct, Digital and Data, and how you can’t have one without the others. The Digital Age is really the continuation of the Direct Age. Data gives us the ability – and the burden – to be accountable. In this way, Direct Marketing will continue to influence advertising.

Channel Neutral vs. Channel Chaos

TORONTO – Today in Canada we spent the afternoon discussing channel-neutral planning.

The U.S., Saudi Arabia, Canada and beyond

This story really started yesterday in Chicago, however, when we were working on a U.S. assignment. The client wanted us to get a brand “back on the air” after several years by virtue of a new product launch. The assumption was broadcast advertising. Thinking it over, the team saw for this product that TV advertising alone would only drive awareness, perhaps missing opportunities to engage the consumer much closer to the purchase decision.

A colleague who spent much of his career in the Middle East observed how this kind of channel-neutral thinking comes much more naturally outside the U.S. “This is how we always worked in Saudi Arabia,” he said. I’ve had exactly the same experience working in or with countries all over the world. Clients and agencies tend to be less divided into departmental silos, so teamwork comes more naturally.

This same integrated dynamic applies to Canada, where the channel-neutral mindset has always been strong.

Channel-neutral meets Channel Chaos

Having a mindset isn’t enough, though, because the choice of channels is complicated. In the days of Ye Olde Marketing, we had mass media, retail and perhaps direct mail or public relations. In the year 2010, we have so many options that some analysis is required, and that’s what brought me to Toronto today. How do you sort through it all?

The basic principles are simple but not always easy. Know your target. Understand what triggers a purchase. Identify what considerations ensue. Envision the moment of purchase. Figure out how to reinforce loyalty and ensure a repeat customer. You may have this down to a formula; in my QSR days our mantra was “bring ‘em in, trade ‘em up, keep ‘em coming back.”

Still, the choices available for engaging consumers at each part of this story are mind-boggling. Ironically, the efficient size of organizations that reduces departmental silos also reduces the available data and research you can use to analyze this process. Just like in the old days you must make some assumptions. In an age of data and research, this can be frustrating.

Channel Chaos meets Channel Control

There are a number of software developments in the market, in beta-testing or in development that will help us sort through these choices, so stay tuned. Today there was an interesting Adweek article about what IBM has been up to this summer. I’m not sure if it’s the wave of the future but it’s exactly the kind of tool that could help us all turn Channel Chaos into Channel Control.

Book Review: The Shallows

The Shallows: What the Internet Is Doing to Our Brains
By Nicholas Carr
W. W. Norton & Co., 276 pages

Nicholas Carr’s new book, The Shallows, explains his theory that the Internet, like all forms of media before it, affects our brains by changing how we think and communicate. In the specific case of the Internet, this effect is to shorten our attention span.

Casting all irony aside, I will now blog about it, in hopes you will have the patience to read an entire book review. Ready? Here goes.

While Carr does believe Internet use reduces the attention span, he actually has a more elaborate thesis: Throughout history, humankind has created many tools, measures and media, all of which literally changed the way we live, usually bringing some advancement to civilization. The human brain adapts to each of these advancements. Neurologists have proven the brain to be plastic in nature, operating according to the routines by which we live. This principle explains muscle memory, addiction, and how we communicate.

The Shallows lasts ten chapters, with the charming irony that Carr interrupts some of the chapter transitions with “a digression”, perhaps to underline his overall point that few of us can stay on track anymore. Nevertheless he stays on track, starting with a personal perspective, then plunging deep into the science of neurology, followed by the history of communication media, and finally tying the two together to show that the Internet, like all media before it, influences our ways of thinking. It’s a compelling case.

This book is thick with science and history, all presented as the engaging story of our journey through oral traditions, cuneiform, papyrus, paper, books and the Internet. Carr sees the benefits of all these media. He embraces the Internet, pointing out how it not only stores information efficiently, but has developed our skills at locating the right information. We may not remember the Dewey Decimal System, because we don’t have to -- and that’s the danger. Carr quotes more than once a caution expressed by Socrates that writing down texts, instead of memorizing them, was “a recipe not for memory, but for reminder.”

Carr is neither Luddite nor Cassandra. Most of the books’ press coverage pursued a “bad Internet” storyline, but in reality Carr sees “the Net” (as he calls it) as simply another invention that’s not only a product of our brains but an influencer of how we use them. In that way the story is a bleak one for bibliophiles. A key finding is that just a decade and a half of Internet usage has reduced our ability to digest long-form literature such as an essay or a book. More than that, Carr laments in a personal observation, “What the Net seems to be doing is chipping away at my capacity for concentration and contemplation.” There’s a kind of resistance-is-futile feel to this and other passages of the book.

Carr also captures a debate between Determinists, who say out technology affects our history, and Instrumentalists, who say our history affects our technology. Carr seems to side with the Determinists, based on his analysis of science and history. Science tells us the brain is “plastic”, forming neural pathways based on how we employ it most frequently. History tells us that we have always molded our brains with each new technology, including the map, the clock and the printing press. It’s worth remembering how revolutionary books were as the Renaissance dawned: “To read a book was to practice an unnatural process of thought, one that demanded sustained, unbroken attention to a single, static object.”

Pursuing the Determinist angle, Carr's examination of the Internet focuses on linked text and its cascading cross-references. Reading a page in a physical book leads merely to the next page. Reading a page on the Internet can lead to hundreds of other pages with just one or two clicks. Chapter 7, “The Juggler’s Brain”, explores how Internet multitasking erodes comprehension. You can access all sorts of data but not all at one time. The software you’re using to read this review isn’t called a “browser” for nothing.

Google comes in for some criticism in The Shallows for its über-quantitative culture. Google’s very business model is based on the number of choices people make, so the more links we click, the more data we feed to the beast. It occurred to me while reading this passage that SEM is like direct marketing on Red Bull. Instead of sending in a single BRC, the consumer votes early and often, every time they click.

Why this matters to Marketers

How does The Shallows matter to marketers? I see two implications.

The first implication is how we train ourselves as professionals. The Internet isn’t detrimental unless it becomes our exclusive way of working. The antidote to Carr’s dystopian view is a balanced use of various media, with a return to more contemplative experiences. Reading is solitary and the Internet is interconnected – you’re never alone with your thoughts. We need balance.

The second implication is that we are marketing to a consumer population that increasingly lacks this kind of balance. The advent of social media will drive short attention spans. How can we engage consumers in an environment like this? It won’t be easy. We can only do so much to influence society, but just going with the flow doesn’t do much good. Balance your messages.

I’m glad you stayed with me to the end of this book review. You probably realize that I recommend reading The Shallows, preferably the physical book. You may not have realized that in tribute to the book, this review contained no hypertext links whatsoever.

Automatic Advertising

As computers moved from computing to other intellectual tasks, people have wondered when computers would achieve artificial intelligence and take over tasks only humans could do, such as develop advertisements.

OK, maybe “develop advertisements” isn’t as high on the list of possibilities as writing great literature or curing cancer, but this is a blog devoted to modern marketing so please stick with me for a moment.

Automatic Advertising

Some recent news stories raise the specter of computer-generated, automatic advertising:

BETC Euro RSCG in Paris has, according to the New York Times, “developed software that can produce elementary advertisements.” It’s called CAI, for Creative Artificial Intelligence. Apparently the software requires you to answer questions such as you would consider when writing a creative brief and voila, hundreds of samples result. Industry veterans in the audience are thinking right now, “What if the brief is poorly written?” The New York Times skips over this point.

PlaceLocal, a startup that provides a similar service to local merchants seeking nearby customers, is even more automated. For example, a pizza restaurant need only provide its location, phone number, web address, et cetera, and PlaceLocal creates a simplified ad to run in local media. The program was developed by Paper G, an advertising technology company. This service strikes me as perfect for small business people who can’t hire someone to place ads for them.

It’s also perfect for local newspapers which can better monetize their web operations instead of pounding the pavement to sell ads in their print editions. That leads me to my next point.

Automatic Media

Both of these developments focus on developing an advertisement, but neither of them really addresses the best medium where the messages should be placed. Where’s the automatic media planning software? In modern marketing, finding the right place to invest the media budget is a much more interesting question than in the past. Back in the days of Ye Olde Marketing we had just a few vehicles to consider.

Today there are many choices. To be sure, there is software to help you navigate the options – Compose, for example. It’s not a substitute for decision-making, though. You use the technology to help you analyze, and then you decide based on everything you know. Similarly, after creating ads with Euro’s CAI software, someone probably decides which ad is the best (or if the brief needs to be rewritten).

Automatic for the People

Crowdsourcing is a phenomenon combining both technology and humanity. Many of you have seen or read about the various crowdsourcing experiments for Mountain Dew under the banner of their DEWmocracy project. Many of these projects sought consumer input in developing the right creative, but a recent experiment sought specific input as to what media vehicles are right for the brand. That’s worth watching.

It’s always important to determine what the right creative message looks like, but part of that determination process is writing a channel plan. A copywriter can hardly write the best print ad if she thinks she’s writing a TV commercial.

The "marketing kill switch"

You just arrived at this page from somewhere else on the Internet, perhaps by link, RSS feed or a tweet. Thanks to a combination of 1s and 0s, a microprocessor, some network switching technology and electricity, everything worked. We take this for granted.

No Internet?

When you can’t get a connection, it’s usually a problem with your server or your Internet service provider. But what about a mass outage where no one can get online? This situation was memorably captured in an episode of South Park, but some recent news items report very real threats.

“We’re from the government, and we’re here to help”

The U.S. Congress is considering the Protecting Cyberspace as a National Asset Act (S. 3480), which has been reported as an “Internet kill switch”. The truth is a little more complicated, but undeniably the law would allow for circumstances where the executive branch of the U.S. Government could shut down the Internet. You can read the law for yourself and this letter from civil liberties groups opposing it.

Force majeure

NASA reported earlier this summer that an expected increase in solar activity will threaten our telecommunications infrastructure. “Our technological society has developed an unprecedented sensitivity to solar storms,” said NASA scientist Richard Fisher. The good news is that they’re watching the Sun carefully. If you’re reading this today it means we suffered no consequence from a “solar tsunami” that hit Earth last night.

Downtime

By act of Congress or act of God, a major shutdown would be catastrophic and few people would care if we couldn't sell our clients’ products. Fortunately, everyday life is much less dramatic. Technical downtime happens here and there every day, affecting about 0.1% of operating time in most commercial applications. Someone fixes it and we get back to business pretty quickly.

Marketing kill switch

The bigger concern is protecting commercial speech. There has been a lot of press lately about how corporations invade privacy via Internet data collection, and we should take those concerns seriously. At the same time, let's be aware of government abuse. Just as a local government used Google Earth to spy on residents' backyards, there are other efforts to restrict how we advertise and sell products online. These amount to a "marketing kill switch" that would a cause a scene in your office like the one in South Park.

Tell me your thoughts, readers, in the comments section below.

How to know "which half of my advertising budget is wasted"

The biggest change in the advertising business today isn’t digital, social media or even the tectonic plate shifts of retail. It’s the measurement and accountability of marketing programs.

Measurement and accountability have been an issue for at least a century, as evidenced by the John Wanamaker quote, “I know half my advertising budget is wasted; I just don’t know which half.

We’ve written about this here, here and here, and made it a central theme in The History of Advertising, which is posted here on SlideShare. Today’s post won’t be the last one on this subject.

How do you know which half of the budget is wasted?

The simple – but not easy – answer: “do your homework”. Just by slogging through data and analyzing it you will learn a lot. So far there is no magical data processing program that can calculate the ROI of everything together.

You can still learn, however, by sitting down and concentrating on Nielsen data, costs-per-lead, et cetera, and figuring out what’s really going on. There is no shortage of data, just time to sort through it all.

Lesson from the world of Economics

Recently two economists published a book about financial bubbles throughout history titled “This Time is Different”. Their thesis is that every time an economic bubble grows, the market’s participants believe “this time is different” – and it never is. We’re always surprised when the bubble bursts.

What’s amazing about their work, though, is how comprehensively they collected and analyzed data. They reviewed economic records across five continents, sixty-six countries – and over a time period of 800 years. 800 years.

You’re a lot less likely to doubt their findings when they’ve put that kind of work into their analysis. (If you’re interested in what they did, you can buy the book here and read more about it here and here.)

Lesson for the world of Advertising

Surprisingly, economists seem to have the same aversion to data as many in our industry. In an interview about “This Time is Different”, the co-authors both observe that modern economic thinking emphasizes theories over actual analysis. Their 800 years of homework is apparently not the norm for economists.

This was reflected in one of Ronald Reagan’s better lines: “An economist is someone who sees something that works in practice and wonders if it would work in theory.”

We run a similar risk, relying only on theories and never sitting down with the data to understand what actually happens. Doing your homework will help prove your worth, and perhaps which parts of the budget are being wasted.

comScore makes another move into TV territory

Last month we posted about comScore acquiring ARS, the iconic TV copy test company.

Last week comScore hired former Arbitron exec Joan FitzGerald as VP-television sales and business development. That's not about testing TV creative, it's about who watches what on TV.

You can also read this article from AdAge.com.

The Moment of Truth

We're going to market right now with an integrated program. Last year the client hired us, and together we defined objectives, wrote a strategy and developed creative for a channel-neutral plan. Regular readers know I work for an agency with many capabilities under one roof, and this program shows what all we can do. None of that really matters, however.

What does matter: In-market results.

This past week I had two parallel conversations about cold, hard measurement and accountability. One was in the comment sections of some online articles about the rise of measurement in modern marketing. It seemed that many people didn't understand the difference between (a) financial metrics like a P&L, (b) planning metrics like copy testing, and (c) performance metrics like sales, share and ROI.

My clients aren't confused. The other conversation this week took place in their boardroom where we updated the CEO on our program. Financials? Check. Research? Check. Then: Are you going to hit the sales objective? That's what matters to them. In-market results.

It should matter to us all

We would all do well to embrace this most important moment of truth. Modern marketing offers us analytical tools to measure progress and figure out how to drive sales more effectively.

Dismissing these tools as the stuff of bean counters and copy testers is short-sighted and wrong. In-market results are the very reason we write strategies, channel plans and creative.

What does the future look like?

Over the past day or so there was an interesting conversation underneath an article about what advertising agencies will look like in 2015.

The article itself starts by saying "the world of advertising is in flux." True. We can all agree that change is a reality.

The discussion broke out over the subject of analytics. Some people embraced analytics as a valuable tool. On the other hand, one person said "analytics is just another word for bean counter".

In the days of Ye Olde Marketing, my life in large agencies was about strategy and creative. Now it's about strategy, creative and analytics. It's much easier to know which half of my budget is being wasted. (I've written about this here and here.)

Back on analytics, a comment by "Bruce" of Toronto is worth repeating here: "I, too, agree [analytics is important]. The problem will be as it has always been, though: What to measure? Advertising's job usually isn't to sell, as a matter of fact. Usually, advertising's job is to predispose a consumer to buy, with the sale being closed by another more immediate brand experience. Measurement will save this business if it's intelligent, and destroy it if it's nothing more than simplistic scorekeeping."

Bruce, I agree -- that's where the channel-neutral planning comes in. If the only tool we have is traditional advertising, all we can do is predispose a consumer to buy. If we plan the consumer's entire path to purchase, however, we can figure out how to predispose, incite -- and close the sale. The measurement will be clearer, too.

The 19 comments posted as of this writing may not be a scientific sample but they would seem to indicate that analytics is far from ingrained in agency culture today. In the future, it will be.

comScore acquires ARS

Last week comScore announced its acquisition of ARSGroup, combining two well-known names in the measurement of advertising messages. You can read the basic news story here.

This is not a routine merger of two companies that offer the same services. ARS is known mainly for pre-testing of TV commercials, often in the form of animatics, while comScore is "the global source of digital market intelligence and the most preferred measurement service".

Naturally, much will be made about the new media testing company taking over the company that for decades has served Ye Olde Marketing.

There's another way to look at it, however. ARS is used mainly for measuring advertising before it is produced and goes on the air, where comScore focuses on consumer behavior in the market. More than the emergence of digital media, this signals the emergence of measurement and accountability.

By the way, the newly-merged partners wasted no time working together. Take a look at this post on comScore's blog written by an executive from ARS.

This is a development worth watching.