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How Blue is the Ocean, How Red is the Sea?
Supply versus demand. You have probably heard these words a
thousand times. You have probably experienced them as well. Remember the release
of the iPad? These units flew out of the stores at the rate of about 700,000
the first weekend. Apple Computer is expert at creating new demand and then
capturing it. However, at the iPad’s
premiere their supply chain undoubtedly had trouble keeping up with the demand.
In the media and advertising world, the talk of supply versus
demand typically turns toward the upfront marketplace where annual TV
commercial time is purchased in a race to the finish. The limited supply of
commercial inventory virtually insures that demand is healthy and that premium
prices may be charged for a declining share of audience. But what happens at
the tipping point where old demand begins to break down? It then becomes
essential to create a new value curve by uncovering new demand.
To do this one has to overlook the red sea and set his sights on a
blue ocean. The concept of a blue ocean strategy typically nets out to a four
actions framework: 1) to eliminate – i.e., to determine which factors that the
industry takes for granted that should be eliminated; 2) to reduce – that is, to
assess which factors should be reduced well below the industry’s current
standard; 3) to raise – i.e., identify which factors should be raised well
above the industry existing standard; and 4) to create – that is, to outline
which factors should be created that the industry has not offered up in the
past.
Application of this framework to the media planning and buying marketplace
might look something like this:
· 1.) Eliminate the network
upfront, move beyond media centricity, eradicate GRP media post-buy evaluation
and move away from push-oriented media planning.
· 2.) Reduce reliance on the
following metrics: demographic reach and frequency, syndicated product usage data based on recall, costs-per-thousand
and irrelevant data that do not contribute strategically to the media selection
process.
· 3.) Raise the specter and
increase the usage of the following metrics: product purchase reach and
frequency, targeting with actual marketer customer purchase data, media
cost-per-inquiry, media cost-per-acquisition, media cost-per-sale and
actionable media relevance measures.
· 4.) Create a real-time (or
near-real time) media marketplace, create plans that are human-centric, implement
pull-based 360 Communications Planning and create and use only return-on-investment
metrics for media post-buy evaluation.
Can you
imagine how different the media business might look if the changes above were
made? Gugelplex TV can. Zero-based communications planning would become the
rule rather than the exception. As important as it is, television will no longer
be a mandated medium used in planning. It will sit alongside others that are
equally important in moving product. It may also have to become price
competitive. All media vehicles, like it or not, will be evaluated on their
ability to drive palatable return on brand sales. No more media properties
hiding behind nebulous metrics that do not tell the entire story about how they
drove sales. It is the business environment everyone pays lip service to yet
fears since they do not know how they stack up. It’s the business environment
that is coming and coming quickly
In
the current business environment we believe that it is no longer about beating
the competition, it’s about making the competition irrelevant. Here’s to today’s
brave new media world!
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