Wednesday, 27 April 2011

How technology will revolutionise advertising (eventually)

In the ad industry, we talk a lot about new technology.

But technology won't fundamentally change the way that advertising works, because it hasn't fundamentally changed the motivations of the people we advertise at. And by advertise at, obviously I mean 'engage in brand conversations'.

New technology won't be the death of TV. The Ad Contrarian is better at making that case than me and he does it frequently enough that I can safely link just his homepage.

It won't provide real time advertising response statistics. Well it will, but shortly after it does, we'll realise that we don't want them. I don't even want my morning coffee in real time, never mind visitor statistics for my web-site. These things need time to consider and appreciate.

What technology is going to do, eventually, is give us some decent kit to do our regular client reporting and media buying jobs. I wanted a TV spot history for one of our clients for the past couple of years this afternoon, so I called up DDS because that's what there is. We all use it.

Pay the DDS website a visit and see if you can find a screenshot of one of their tools on it. Red flag number 1 for a software provider that is - if images of the software aren't front and centre on the website and they're using generic business-like stock images instead, then invariably it's because the software is crap.

For the record, if you want to extract a list of TV spots for your client, then the software looks like this. No I didn't write this post in 1992 and never get around to publishing it.

You can't get more than a year's data out, ever. In fact if your client has run any number of ads, then you can't get more than a couple of months out at a time. More user friendly databases than this used to run on the BBC Micro.

Also from DDS and embedded in a large number of media agencies is the BrandOcean timesheet system, which is more modern (it's got a web interface!) and is arguably even worse to use.

It's unbelievable that a client ringing up and asking for a detailed history of their press spends for the past couple of years, can spark panic in a planning team if they've only got a day to put it together. Any exec should be able to run that data in ten minutes.

OK, most industries have got some legacy software hanging about and it's often not very good, but marketing is a special case. The tools we use every day to do our job are shockingly bad. In planning and buying, in research and in reporting, vast amounts of time are wasted by account handlers fighting against crap software.

In a large number of cases - Telmar and much of the DDS suite for example - all the software really does is interface with a prorietary database and make it difficult to extract what you need. You're forced to run four separate queries to get four years' worth of data, or told you can't have TV stations and spot lengths together in the same table, because it's not a report the software knows how to build.

We need - as an industry - to refuse to buy these systems. You've got raw data I need? Great. I'll have it raw in a database please and I'll point my own 21st century software at it.

Technology will eventually change the marketing industry, but I fear that its arrival is as imminent as Facebook's triumph over TV advertising.

Wednesday, 20 April 2011

This retail obsession with yesterday's weather

When I sit down with a new client to explain econometrics and how we could measure the effectiveness of their advertising, the conversation usually goes something like this...

Analyst: So we'll build a mathematical model that explains all of the different drivers that have moved your sales over the past two to three years - price changes, advertising, discounts and promotions etc.

Client: You don't just measure the advertising?

Analyst: No, we have to measure pretty much everything that has had a major impact on sales, so that we can be sure we've got the advertising measures right.

Client: Ah, I get it. So you have to include the weather?

Analyst: [Sigh] Yes, we'll have to include the weather.

If the client is a retailer, measuring the impact of the weather will come up every time, guaranteed. There's some logic as to why retailers are obsessed by it, but that doesn't mean it helps to be concentrating on how much it rained yesterday.

First, a caveat. If the business sells ice cream, then of course it matters. I once modelled sales of cold sore cream (fought hard to get allocated that one) and temperature was tremendously important to sales.

Let's imagine a clothes retailer though. The first thing to note about retail analysis is that far more importance is placed on what happened last week - particularly what happened last weekend - than you find in other businesses. This makes sense for stock control and making sure that your London stores haven't run out of men's blue shirts but it doesn't make sense for working out whether your advertising campaign (that has already been running for six weeks and has another three to go) is working.

So you look at last weekend's figures and sees sales are down 5% year on year. The school holidays were at a slightly different time last year, but you haven't got data on those, so stick it in a footnote on the report. You have got data that says it was sunny last weekend. Everybody must have gone to the beach, or had a barbecue and that's why sales were down.

Even if it's true that 100% of what happened last weekend is down to some hot weather, what have you just achieved? It will rain at some point - we're in the UK after all - and those people who had a barbecue last week will still need a new suit. Some sales might have been lost forever, but how does knowing that hot weather will reduce sales help you? You'll still have to open the store even if the forecast is for a scorcher.

I've seen more than one retailer's weekly sales report that has a box on the template to cut and paste a screen grab from the weather forecast. That sort of reporting ends up creating an even bigger problem - one of positive reinforcement. It's easy to remember the bad weeks' sales reports that had the hot weather symbols on them and then to assume there's a strong underlying relationship to your overall sales.

This weather obsession is a symptom rather than the cause. The underlying problem is concentrating far too hard on a single week's (or a single Saturday's) sales figures. Once you're in the situation of trying to explain a single day's sales, you'll fall back onto what you've got data on for that day - which leads you, inevitably, to the bloody weather again.

If you're trying to work out what actually drives your business, forget last week. Forget last month even. Spend some time pulling apart at least a year's worth of weekly sales data and see what you find out. Try charting a year's worth of weekly sales against a year's worth of rainfall data. That close relationship that you thought your sales had with the weather, will vanish almost every time.

On the other hand, if you do have a heavily weather impacted business - if it really would help you to know what the long range weather forecast is likely to do to your business this summer - give me a call. We econometricians can do that too, as well as measure adverting and rant about weekly sales reports.

Monday, 11 April 2011

Do you follow anyone who makes things?

I came to a shocking realisation today. Of all the blogs I read and people and companies I follow on Twitter, not one of them makes actual, physical things.

Many of those I choose to follow are creative and often inspiringly so - that's why I follow them - but they make presentations, strategies, beautiful visuals, publications and software. Not one creates things that I can touch, or hold, or feel. High quality engineering is inspiring to me, so how the hell did that happen? The best software or graphic in the world still can't match a beautifully engineered, physical, thing.

If your reading list looks similar (and I'll bet it does for a high proportion of marketing people) then I think we should be collectively ashamed of ourselves. Creative? We're living in a world of strategies and PowerPoint; that's not creative.

For me, this is a work thing. @Data_monkey and my feed reader are used almost solely for marketing and both are distinctly lacking in connections to the physical world. Outside work, I spent a very satisfying day yesterday dismantling, cleaning and reassembling a motorcycle, which is probably what's inspired this post.

It's time to swing the balance back a little. Triumph Motorcycles are a new client, so @TriumphOfficial is my first proper engineering follow. Proper engineering looks something like this. Beautiful isn't it?

Wednesday, 6 April 2011

Data Visualisation: Naming and Shaming

I seem to have ranted about data visualisation quite a bit recently and you lucky lot only get to hear the rants that I get around to writing down. Here comes another one...

Since my dashboard software evaluation exercise (I will finish those reviews, promise) a few software providers have kindly signed me up for a damn good sales email spamming.

Logixml just mailed to say that they had three new example dashboards waiting to be played with and no analyst worthy of the name can resist an offer like that.

Here's the Financial Services example.

Good God, where do I start? Well it's certainly colourful.

Let's just say that I'm running a couple of training sessions on data visualisation later this month and when I finished off the deck yesterday, it was missing a single, impactful slide that showed how to break every rule in the charting handbook.

It's got one now.

Friday, 1 April 2011

Destroying an amazing data visualisation

Hans Rosling was on BBC2 last night, presenting a program called 'The Joy of Stats'. He showed his amazing visualisation of a 200 year history of life expectancy vs. Income. If you haven't seen it yet, it's well worth watching.

Unfortunately, the programme was a perfect case study in how to destroy a compelling dataset with chart junk. Take a look at the video above and how beautifully clean and simple that chart is.

Now imagine a camera cutting all over the place and zooming in and out of an image that looks like this. I can't believe it was Rosling's idea.

Pretty, maybe. But so much less effective.