All marketers chase "Effective and Efficient Plans". Why is the money not following?

The magic words in marketing strategy were, are and remain “effective AND efficient” (E&E). Sure, there are many “words du jour” like A.I., Purpose Marketing, in-housing or end-to-end consumer attribution. But marketers always come back to “I want my plans to be both effective and efficient”.

So it is kind of surprising that when it comes to choosing their mix of touch points to deliver their purposeful messages through their in-house managed consumer funnel dotted with attribution triggers, they seem to be losing sight of their own effective and efficient mantra.

Proof? Sure!

Vast amounts of media are invested in digital, the medium that promises the most data points to proof that it delivers. The reality is however that most marketers struggle to understand the outputs, let alone the outcomes of their digital investment.

Most digital strategies are informed, it seems, by “everybody else is doing it, so we are, too” and “I can’t very well NOT be in digital”. The proof points remain elusive, though, especially in terms of brand building and other, broader marketing objectives. Some brands are getting very good at understanding sales, provided they sell directly through digital. But even there, the attribution of what triggered the actual sale is often shrouded in mystery.

The second proof point is that marketers are each year still spending lavishly in the TV upfront. Fox, Disney, Hallmark, NBCU, Warner and others have reported strong gains in their upfront volumes, and especially in their Cost per Thousand (CPM) increases. In fact, industry data confirms that TV inflation frequently outperforms regular US inflation.

And this is happening at the same time as network and cable TV are losing audiences, because more and more people ditch their cable subscriptions and watch content via non-advertising supported streaming, making that the fastest growing “TV” platform.

Obviously, media agencies and advertisers negotiate. Very often, a media agency is asked to “negotiate the inflation away”. But even if they manage to cut TV cost inflation in half, or to zero, the fact remains that at zero your budget will deliver a smaller audience than you what you got for that same budget last year. So, it would appear that marketers are indeed willing to pay more for less. That seems hardly efficient, and will harm effectiveness, especially when we know that advertising budgets do not increase as fast as media inflation, and they are used across an ever growing mix of touchpoints.

P&G and Unilever have publicly reported that in-housing and other efficiencies have saved them hundreds of millions of dollars. They have taken costs out of their agency ecosystems, and best as I can tell added them to re-investment in inhoused ecosystems and their bottom line. What is less clear is how much was used to invest in understanding "effectiveness". There are some indications of investment in that all-important area, but large advertisers and agencies seem far more eager to talk about how much more efficient their investments are, and much less so about how effective they are.

• Ensure your plans are chasing "Effective and Efficient" goals in words and actions.
• Set realistic goals for both, and do not fixate on "savings" only.
• Make sure you incentivize your own teams and your agency partners on delivering both. If you say you want both, but incentivize on efficiencies only, guess what you will get?