Digital Matters - Issue 48

First Adland fell in love with the Internet, and then the Internet crashed. Now both marketing and advertising have discovered the next big thing: ideas!

So what happens next in Adland? A couple of years ago, people in the advertising community looked out across the horizon and saw the Internet bearing down on them like an ugly tornado. They were terrified. The more they read about what was coming — TiVo, permission marketing, wireless technology — the more frightened they became. The question loomed: How does advertising's push model "work" in a networked, peer-to-peer world?

The initial answer, to Adland's complete surprise: Better than your wildest dreams! When the tornado touched down, it didn't rattle windows and tear down walls. It showered money on every agency from California to New York. All of those new dotcom companies wanted to advertise during the Super Bowl and the Academy Awards and the Grammys and ER! And on the radio. And in all of the new magazines. The tornado turned into a money tree.

Better yet, the whole dotcom business model was premised on something called "mindshare." It was a term that most folks in Adland had never heard before but one that they quickly adopted as a sexy new mantra. The Adlanders got very good at all the lingo — "first movers," "monetized eyeballs" — very fast. Before long, they had it down cold. Their answer to every dotcom marketing challenge was a ton of traditional advertising — gotta have mindshare! — especially television advertising. And the dotcommies, flush with IPO cash and naive beyond words, bought it hook, line, and sinker. Turned out they were just like everyone else: They wanted to be on TV.

And then it all crashed. It crashed so fast, it took everyone's breath away. In January 2001, recruitment advertising in the San Jose Mercury News was down about $100,000 from the year before. In February, it was down $2.5 million. It just evaporated. Truth be told, many people in the advertising and marketing community regarded the evaporation with some relief. When it all came crashing down, the hope was that the business would revert back to normalcy: Let's all go back to the traditional agency model.

But it didn't, and it won't. Internet technology itself is disruptive and destabilizing. And it isn't going away. In the traditional broadcast world, with a central station beaming out messages to the nodes, advertising matters. In a networked world, where everything is interconnected, ideas matter. What doesn't matter, in theory at least, is where those ideas come from. This technological shift elevates the importance of what has come to be called "ideation."

Consider American Express. What has worked for AmEx in the past 18 months? Not the dreadful Jerry Seinfeld advertisements that ran, at enormous expense, during the Academy Awards in late March. The big AmEx success story of the past year and a half was a great idea developed by Momentum Worldwide, a special-events-planning agency. Momentum proposed an outdoor concert in Central Park featuring Sheryl Crow, among others. The event, which was aired on television, radio, and the Web, "launched" AmEx's new product, the Blue card. The concert garnered a ton of free media, which was supported by print and Internet advertising. The launch was so successful that there was an eight-week backlog in processing Blue-card applications. AmEx could not keep up with demand.

Ogilvy & Mather created television advertising to back the Blue card (one ad features a robot twisting the card this way and that, as a visual metaphor for the card's "flexibility"). But while the TV ads no doubt played an entirely supportive role in the rollout of the product, it was the concert that really ignited the Blue card. Momentum had a great idea, and American Express allowed them to run with it.

The notion that a special-events-planning agency would play such an important role in the introduction of a major product extension like the Blue card for a company like American Express would have been unthinkable 10 years ago. It simply would not have happened. But in the networked world, the perceived status of a company like Momentum was irrelevant. What mattered was the quality and effectiveness of the idea. And the idea worked.

As more companies come to understand the importance of ideation in a networked world, they will increasingly turn to agencies and firms that provide that service. This is especially true in the current economic downturn, where a big idea is much easier to get approved than a big ad budget.

Back in the days of the heady dotcom froth, Internet-advertising agencies boasted that they would soon become the next giants of Madison Avenue. It didn't turn out that way, to say the least. It turned out that the only banner ads anybody ever clicked on were the ones that promised a lower price. And it turned out that "precise" targeting — putting the right message in front of the right Internet surfer — was anything but. Agencies ended up selling inventory (how many times have you come across the "punch the monkey" ad?). And, unsurprisingly, most of the major Internet-advertising companies have all but collapsed.

What the Internet gave rise to was not Internet advertising but ideation as an advertising force. The technology created a network, which placed a premium on ideas. And it is within the context of this "space" that the advertising business will be redefined in the next few years.

This new domain is wide open. Consulting companies like McKinsey & Co. (which recently purchased Envision, a Chicago-based branding company) are getting into it. Public-relations firms like Fleishman-Hillard are getting into it. And of course, advertising agencies (as they see ad budgets sliced) will get into it, if only to protect their core product: traditional advertising.

For as long as television advertising has existed, creative product (a good art director and a good copy writer working well together) has been the driving force in the business of advertising. And it remains important. Bad ads badly executed don't do anyone any good. Good ads well executed can capture public attention and resonate over time. But the days when good ads were all that mattered are over. Technology did indeed change the game — just not in the way that people expected it would. Ideation is the future of the advertising business. And that's a very big idea.

John Ellis (jellis@fastcompany.com) is a writer and consultant based in New York.

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