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How has technology changed advertising?

Technology has changed advertising in two specific ways. Depth and Speed.

In 1923 when Claude Hopkins wrote his classic Scientific Advertising, most of the principles of modern advertising had already been established. You should get to know your prospective customer as well as possible using the principles of psychology.You should test one campaign against another in an effort to determine what works and what doesn't.

100 years of technology has not done much to change these basic principles, but what it has done is change the Depth to which we can learn about our customers and the Speed with which we can gain these insights and implement changes based on them.

How Information has improved Depth of Knowledge.

The rise of advertising in the 20th century parallels the rise of psychology in many ways. Both are concerned with being able to understand the basic human drives, predict and ultimately influence behavior. While psychologists were inventing ways of cataloging the human experience, such as the famous Myer-Briggs Type Indicator (1962) and the less famous Minnesota Mulitiphasic Personality Inventory or MMPI (1939) they used questionairres, cross referenced with identical questionairres given to people with known psychological attributes and defects in an attempt to objectively, scientifically categorize various personality times.

At the same time, marketers were using similar techniques to categorize people into different lifestyle segments. The rise of computers along with psychological theories allowed marketers to segment the population according to what magazines they read, and what television programs they watched. The rise of psychology and marketing in the 20th century is documented in the excellent documentary The Century of Self.

During the 2000 presidential election, Republican street teams were armed with PDAs with short videos and addresses. The addresses were for swing voters that their computers had determined were the most likely to be able to be swayed by a house call in the days leading up to the election. The videos were short and persuasive - each phrase and image tested and re-tested by Republican pollster Frank Luntz, author of the infamous "14 Words Never to Use" that changed "Capitalism" to "Free Market System" and (in another memo) "Global Warming" to "Climate Change."

Luntz is also author of Words that Work, What Americans Really Want... Really, and Win.

He works by conducting focus groups where people watch videos of speeches & on a moment-by-moment basis rate their opinions of what's being said by turning a dial. The instant someone says something that resonates with them - or that they dislike - he knows it. Techniques like these bring an unprecedented level of knowledge to the marketer's toolkit. You can learn more about Luntz and others in the excellent Frontline documentary The Persuaders.

The internet brings its own innovations into consumer behavior. Not only do we no longer have to rely on magazine & television viewership statistics to gather information about people, we can track their individual searches and clicks. Founded in 1995, and acquired by Google in 2008, Doubleclick was, for a long time, the king of the hill in learning the browsing behavior of users and serving up ads that were specifically relevant to them. If you searched for sports products, or created an account on Doubleclick was able to track this activity and serve ads based on this knowledge. Facebook has recently come under similar criticisms, notably by blogger Nik Cubrilovic for tracking you as you traversed the web, even if you'd clicked "Log Out" of Facebook itself. Today this technology is available to anyone with even a modest budget through Google's Remarketing service.

100 years ago, books ad advice on things like which corner of the ad should have the coupon, what type of dotted line encourged more people to clip the coupon, etc. Today heat maps, which track eye movements & clicks help marketers determine what people are paying attention to on websites.

How Information has improved the Speed with which marketing knowledge is gathered.

For decades a small town in Arizona has been a test bed for advertisers. Everyone in town is given a discount card to the local supermarket. They're also shown ads that haven't been shown yet elsewhere in the United States. Marketers will pilot ads there and see how buying behavior changes over the next few weeks. If they start buying the products that are advertised, they know they have a successful ad. If buying behavior doesn't change - they know the ad doesn't work that well.

Bringing this one step further, the 2005 Frontline documentary The Merchants of Cool shows how MTV's street teams develop contacts amongst teen trend setters to discuss what's new & hot, and then put that on air later within days. They then measure the reaction amongst their viewership in order to decide what to promote next. Their show Total Request Live provides near instant feedback on what the hottest videos are - fans vote for their favorite videos and they're shown the next day.

I've already discussed how focus group techniques by Frank Luntz are able to instantaneously provide feedback about what phrases work and what phrases don't during press conferences, political debates etc.

On the internet, many ad networks, including Google Adwords work on a bidding model- only the ads that get the most clicks survive and they push out lesser ads. This benefits the sellers because only their most successful ads stick around, and it benefits Google because they want to show better ads to their customers to collect some of that ad revenue.

Tools such as Google Website Optimizer allow marketers to quickly and easily test one version of their website against another and see immediately which version is better. Tools like this allow you to do this within hours instead of wait for weeks via regular mail.

This very Darwinian model is at the heart of all advertising- the advertising that works stays, the advertising that doesn't work dies.

What has changed, what hasn't?

The fundamental principles of advertising haven't changed that much. Get to know your customer as much as possible and test your ads against one another. A century of technology allows people to do this with more specificity and with greater speed than ever before, and thanks to that speed and knowledge less expensively as well.

January 3rd, 2012

© Mark Wieczorek