Why Ad Tech Can't Build Brands (Yet)

In April this site published "Ad Tech Primer" to lend this writer's background in ad tech to the democratic conversation around social media ads and market surveillance finally taking place in our public sphere.

Today this site brings you a transcript of a podcast that explains why ad tech may nudge you toward a conversion event, but has yet to be effective at building brands. It may never be effective if tight surveillance remains the norm.

The Ad Contrarian produced this podcast episode "I Finally Understand Why Online Advertising Doesn't Build Brands" and the title immediately caught this writer's eye. This episode falls squarely inside this site's beat. Begins "Ad Contrarian" Bob Hoffman:

For years I've been writing about a mystery that should perplex any clear-minded marketing person: the mystery is why online advertising seems to be incapable of building customer-facing brands.

We've had 20 years of phenomenal growth of online advertising and yet I have trouble coming up with one example of a major consumer-facing brand that was built by online advertising. I can think of no example of beer, soda, cars, toothpaste, cookies, candy, fast food, sneakers, peanut butter ... you get the picture ... that were built by online advertising.

There are some who make the case of web-native brands that have been built by online advertising like Amazon, Netflix, Google and Facebook. I'm not so sure that advertising played a significant role in the building of any of those brands - but lets leave that argument for another day and just talk about those brands that are *not* web native, which probably constitutes about 95% of the brands in the world. So the question is: whats the problem with online advertising that has rendered it ineffective at advertising's most important job, building a brand?

For years I've fumbled around trying to answer this question but I've never really understood it. I've blamed an absence of creativity, I've blamed the fact that it's mostly direct response style advertising. But I've never really evolved a comprehensive theory of what the problem is, but someone else has - and that's our subject today.

A few days ago I received an email from Richard Shotten who's a very smart guy and works at --

--Hoffman received an email from his friend Richard Shotten (possibly this Richard Shotten.) Shotten spotted a tech blog post that expanded on another blog post that in the end gave Hoffman a eureka moment. Hoffman being a copywriter took the tech blog writer's exposition, summarized it and wrote a very listen-able script for audio. The tech blog post was titled "Ads Don't Work That Way" and it first laid out the conventional wisdom of how brand-building was understood to work, before the tech blog writer went into his own argument of how brand-building advertising actually works.

Here's Hoffman again, after giving proper credit to his "very smart" friend Shotten who emailed Hoffman the blog post. And just before Hoffman continues his line of reasoning, he twice credits the author of the blog post and gives the listener the blog post title. (Hoffman knows how to write for audio. When a listener or viewer has no text to follow, some repetition is helpful.) (Point two to Hoffman - he grants proper attribution. Could be a copywriter's trait or he may just be a classy guy.)

Hoffman summarizes Simler's writing on conventional wisdom's understanding of brand-building advertising, what Hoffman calls the "Standard Model":

So Simler starts by quoting some standard explanations of how advertising works at brand-building. Let's borrow some terminology from subatomic physics and call this the "Standard Model."

Here are some examples from the Standard Model: "An ad succeeds at making us feel something," it says, "and that emotional response can have a profound effect on how we think and the choices we make."

Or, it works "by creating positive associations between the advertised product and feelings like love, happiness, safety, and sexual confidence. These associations grow and deepen over time, making us feel favorably disposed toward the product and, ultimately, more likely to buy it."

Or, "advertising rarely succeeds through argument or calls to action. Instead, it creates positive memories and feelings that influence our behavior over time to encourage us to buy something at a later date."

As Simler says, if Coke shows us enough images of people beaming with joy after drinking their product, we'll come to associate Coke with happiness, then sometime later we'll be more likely to purchase Coke.

Simler is not happy with this argument. He says it portrays us as far less rational than we actually are. We may not conform to a model of perfect economic behavior, but neither are we puppets at the mercy of every Tom Dick and Harry with a billboard. We aren't that easily manipulated, he says. Instead, he offers an alternative view to the Standard Model that he calls "Cultural Imprinting." Now don't be turned off by the terminology.

Next Hoffman lays out the new model by tech blog "Burning Asphalt" author Simler. Instead of the "Standard Model" of advertising to build brands, Simler's brand-building advertising model is more specific, and specific in a way that we only could articulate in the online age - when we moved away from "Cultural Imprinting" via broadcast and print. By moving away from older (but not obsolete) tech, we finally articulate one advantage of it.

Hoffman explains Simler's "Cultural Imprinting" theory (and "necktie products"):

The theory underpinning Cultural Imprinting is that in some way we all want to be part of what is culturally acceptable. As he [Simler] says, brand images are part of the cultural landscape we inhabit. They provide cultural information. When we ignore brand messages, we're missing out on valuable cultural information and alienating ourselves from the zeitgeist.

He [Simler] says this puts us in danger of becoming outdated, unfashionable or otherwise socially hapless. We become like the kid who wears his dad's suit to his first middle school dance. In other words, to some degree, we all strive for social acceptability.

Of course this is not new thinking. When I first started working in the ad business a thousand years ago we used to call products that were most responsive to advertising "necktie products." In other words, products that are used or consumed in public, and are visible to others. Why are products like beer, soda and cars so responsive to advertising? Because these products are visible, and whether we want to admit it or not, we want to be socially acceptable.

Necktie products. Only a real adman could have told us that. Now Hoffman brings it home, and describes what Cultural Imprinting has to do with online ads, targeted or non:

OK so what does all this have to do with the online advertising problem? Here's the connection I've been missing. In Simler's words, "Cultural Imprinting relies on the principle of common knowledge. For a fact to be common knowledge among a group, it's not enough for everyone to know it, everyone must also know that everyone else knows it."

In other words, part of our purchasing calculation is not just our belief that this brand is acceptable, but our expectation that other people believe this brand is acceptable because *they know what we know.*

Here's the example he uses: in the Standard Model we see a Nike ad that makes an association between Nike and athletic excellence. Over time, we internalize this association and feel good about Nike and when it comes time to buy some sneakers at a later date, we're more likely to buy Nikes.

In the Cultural Imprinting model, it starts the same. At first, we see a Nike ad that makes an association between Nike and athletic excellence, but here's what's different: over time, we realize that everyone else also associates Nike with athletic excellence. And when it comes time to buy shoes, we expect that people will think more highly of our knowledge or our ability at athletics if we buy Nike. This does not guarantee we'll buy Nike, but it makes the likelihood greater.

So for an ad to work by Cultural Imprinting, it's not enough for it to be seen by a single person or even by many people individually. Everyone has to know that everyone knows.

This is why search ads and banner ads are ineffective at Cultural Imprinting, and accordingly at consumer brand-building. As Simler says, everyone lives in his or her own little online bubble. When I see a Google search ad, I have no idea whether the rest of my peers have seen that ad or not.

In a nutshell, this is why mass market advertising is demonstrably more effective at brand-building than precision-targeted, highly individualized, one-to-one, online advertising.

So for years I've known that online advertising has been mysteriously ineffective at brand-building. And now I think I finally understand why. And the irony is that the person who connected the dots for me isn't a marketing or advertising person, he's a tech nerd. But I believe he understands marketing better than 99% of the so-called professionals currently working in the industry.

One nice byproduct of writing about technology from the outside in is encountering people from other professions. Hoffman lacks the techbro braggadocio, and he practices thorough attribution which builds bridges on which ideas can travel. Hoffman's attributive nature may be a trait found in the ad industry or it may be him, but it's refreshing as was his summary of Simler's idea (which reacted to a blog post from Lifehacker.)


------------------
Further Reading:

"Maybe I'm comfortable associating myself with a beach-vibes beer. But if I'm worried that everyone else has been watching different ads ('Corona: a beer for Christians'), then I'll be a lot more skittish about my purchase."   meltingasphalt.com

Artist Guido van Helten paints silos in Brisbane.   www.abc.net.au






This work by AJ Fish is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.