Who doesn't love Honda's advertising? Ever since Cogs, they've been producing consistently fantastic creative ideas.
Following up on the prediction in my last post that Vimeo is set to put a big dent in Youtube, Honda has used its higher quality and much nicer interface as part of their latest campaign.
Honda Insight - Let It Shine from Honda on Vimeo.
Click the video above, or even better, have a look on the site. The page dimming when you press play has been created especially for this ad.
That's the brilliant bit.
And now the slightly depressing.
I'm sure these campaigns work. They sell product. They make Honda more profitable. But if Honda did econometric analysis of their sales and trusted completely to the results, then there's no way any of these ads ever get made.
Econometrics favours advertising that we can measure, which means advertising that has an immediate and obvious impact on sales. In terms of return on investment, an econometric model will say every time that product advertising - preferably in conjunction with a comptetitive price point - has a higher ROI.
In the short-term, econometrics is right. Product advertising does measurably sell more product. If you've got a warehouse full of unsold Honda Civics and they're depreciating, then the best thing you can do is discount them and advertise cheap Honda Civics. Econometrics would be very good at telling you what price point and how much advertising. In the long-term though, wouldn't you rather not get yourself into the situation where you've got lots of unsold product?
Econometrics has a valuable place in marketing decisions. Speaking as an analyst, If I was a marketing director I'd use it, but give it less prominence in making decisions than you might imagine.
As analysts, we've got a major challenge to incorporate the wider benefits of good advertising into our models. To prove that Honda's advertising works.
At the moment, pure econometrics is like procurement in a large company. Yes you could equip your office with cheaper PCs and cheaper desks and give your staff cheap business cards and make the company more profitable this year. That's very useful information, but only part of the decision about how much to spend.