Expert: Peter Gabany - 10/19/2008

Question
QUESTION: I am a student researching a piece on the the evolution of advertising from print to online.  What would you say has been the most significant changes that have occurred and what directions do you think ads are headed?

ANSWER: Time is possibly the most significant driver for the type of advertising we see today and will see tomorrow. Let me explain. Yesterday people had the luxury of time. Reading long copy print ads was not considered arduous. People did not have the information available at their fingertips (Internet) and to become better informed the prospective customer would appreciate becoming better informed about a purchase decision.

Time also affects other dynamics. The time to innovate has become truncated. A new aircraft which could take a dozen years of design and engineering is now taking 24 months to prototype all the way down to major advances in the music industry. The demand for new products and services is met with new manufacturing methodologies to create new product in record time. This process is costly and therefore the time to recover costs are truncated. Public relations, sales promotion and advertising became willing bed partners in the late 80s when the term integrated communications was born. Ad agencies knew that they had produce a better return for their client dollar, while preserving their profitability and growing revenues.

Arguably they saw the wisdom of incorporating PR departments, Sales promotion departments and purchasing direct mail operations to expand their portfolios of service. Now a client's million dollar budgets were considered over several channels of marketing. Public relations was used more strategically (by ad agencies) to build brands, while advertising was used to support the brand image and claim.

The dawn of the internet (a further truncation of time) opened access to information in a heartbeat. Today it never ceases to amaze with the integration of both online applications which enhances viewership and the time people are spending on the internet - in front of advertising.

Print advertising was measured in a cost per thousand people reach and 2.5 readers per copy to support the value of advertising. Visual ad tests were done to track people's responses to ad size, colour and design where today on the internet through the use of search engine optimization programs, pay per click campaigns, link popularity conversion models are created with the ability to throttle sales. What does this mean? Simply, if you spend $10 you can gain $100 or for ever $1 spent you can convert $10 in sales.

How it works is unique. Through pay per click (every time someone clicks on a searched link, your account is debited. This process is done through key phrase popularity and ranking. Each key phrase is ranked as a value - it could be 5¢ per word and upwards of double digit values. Every time someone clicks on a link and arrives at a web page the owner of the web page has the unique ability to make a sale. Content of the page becomes king - becomes the ad so to speak or at least one of the many ads that drive the person to the website. This ad points the way to the sale and depending on how well it is crafted, how easy the interface is design for the browser to make a purchase will determine the effectiveness of the conversion model.

Obviously brand remains ever important. If the system fails in any way the ability to convert is jeopardized. Therefor the rate of return is affected.

The internet has many channels onto itself. Social networking - driving people to a web page promoting an offer at little or no cost will enhance the ability of the site to make more money.

For more information and simple explanations look to the commoncraft web site or commoncraft In plain english videos on YouTube.

I hope and trust that this helps. This is a big topic and requires much research and further discussion.

Cheers,

Pete


---------- FOLLOW-UP ----------

QUESTION: First, thank you for your time and depth.  I have just a few more questions:
1, What does one have to do in order to become an ad executive?
2, With the recent changes in the economy, how has that effected ads?
3, What main legal issues are most relevant?


Answer
1./ Attending school such as Northwestern or U of Texas in the US or Youk/Sheridan or U of Toronto in Canada will give you a great understanding of the industry by enrolling in marketing, business or design. Seeking placement while in school with a client who advertises (in the marketing department) or with an ad agency in the account management department will help to prepare you for this role.

2./ The first thing to cut (wrongfully) is advertising or market spending, yet it is the fuel for any and all business. People have the tendency to recoil at first and hold onto their cash. Often (in smaller businesses) they hold on too long that any type of spending becomes too little too late to save an enterprise. One must spend wisely and monitor change in their sales to ensure that all market and ad spending is delivering the return they need to succeed.

3./ This question is too nebulous to answer. Specific to what?

thank you again for your questions.

Pete