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Curb Agency Enthusiasm? Agencies Need To Evaluate Use Case Before Tech Thrills

As the agencies and their clients descend on CES this week, 4A’s Foxgrover offers advice on seeing through the hype to reality, be it augmented, virtual, or actual.

The 4A's Chick Foxgrover
The 4A’s Chick Foxgrover

It’s safe to say that 3D TV screens and the latest in augmented reality will leave CES 2016 attendees dazzled by the end of this week, but knowing which ones will have an actual impact still seems like a guessing game.

Chick Foxgrover, the SVP and chief digital officer for agency trade association the 4A’s, has some thoughts about determining the hierarchy of promise when it comes to advertising’s relationship to technology advancement.

GeoMarketing: Part of your role at the 4A’s entails outreach on digital marketing technology. What areas have the agencies sought to explore as 2016 approached?

Chick Foxgrover: There’s an increasing appreciation for context in addition to things like demographics and targeting. There’s a lot more interest in the Internet of Things and the use of sensors for tracking all different kinds of data, not only in the marketing space, but everything to warehouses and offices. It comes down to how people are getting better at understanding the kinds of signals that the centers are pushing back at them in order to then characterize certain human context for messaging or marketing.

We’re still at the very early stages of this. Malls and brick-and-mortar stores are starting to pull those things together. They’re starting to use the data that’s available to them to market effectively to certain context versus a particular set of people based on their demographic information.

The underlying use of that data in an online/offline context also depends a lot on the notion of permission-based marketing. That’s certainly not been a big part of major ad buying and planning before. How does that change the approach agencies have to take?

It’s complex across all of those industries, in a sense. From a media buying standpoint, we’re talking about a set of businesses that are primarily concerned with efficiency and reach, and mass marketing if you will. And now, with the advent of ad blocking, there’s a lot of concern around the advertising creative that is being used in a mobile context. People are concentrating a great deal more on how they should change their marketing tactics, and the kinds of creative that they use in order to make it more welcome in the kinds of areas where marketers would like to speak and to send messaging.

Permission-based marketing makes a lot of sense when you’re in, let’s say, a brick-and-mortar situation. If your primary goal as a consumer is to get the lowest price and whatever coupons happen to be available at that moment, then those are the things that you want to see. At the same time, your mobile device is such a personal and intimate device. And it’s doing a great deal more for you than simply being a shopping companion when you’re in a mall or in a store or something like that.

So advertising needs to learn how to appropriately speak at the right moment in order to be welcomed, I think, in those situations.

Are there any implications for the creative/messaging side of the agency business?

On the creative side, what all that means is that people will be looking more at the design aspects of how advertising should look and feel. You’re already seeing a lot in generally on that topic, as there’s a lot of debate around ad blocking and how and when permission is asked from consumers. At this point, all of these devices and the fact that the world is connected in various and sundry ways is no longer novel There’s going tor be a great deal more discussion about the nuances of what it means to communicate through all of these personal devices for commercial and other purposes.

Society is going to end up going through a lot of soul searching over everything having to do with surveillance and safety and security. And it will go all the way through the kind of information that’s being passed in any context, whether you’re in a store or anything else. That’s going to be a huge topic of discussion through this year. And that will ultimately influence agencies and how their creative is designed.

Ever since digital began to emerge as an agency discipline over 15 years ago, the discussion has focused on how deeply agencies should integrate channels — from display to mobile to social — into their traditional units. Is that process of making “all things digital” making that process for main agency brands more of a reality these days?

There’s some movement along those lines. In some ways, it’s going to be sort of a movement that’s coming from two directions. One is a certain amount of a realignment inside of the agencies. If you’re seeing a bit-by-bit sort of a change towards multi-disciplinary teams that work against certain kinds of strategies. There’s some structural things that make that difficult for agencies to do even when they want to. And what I mean by that is that the way agencies are compensated does not necessarily lend itself towards them being very agile in the way that they create their teams.

The agencies are compensated on the number of people that work on something, and what’s most efficient is to use the structures that are in place and to count the hours that people work. Putting smaller, leaner, cross-functional teams on it means that you lose a certain amount of control over how much time people spend on things and what exactly that they’re doing that is necessary for the type of reporting that they’re required to do in their compensation agreements.

What’s the impact then on recruitment and training of agency staffers?

The skill sets of the workers in advertising is simply going to change as a matter of course as the workforce becomes younger, and people who are coming into whatever job they’re coming into, even a very traditional role like account management or creative, or something like that is simply going to have a natural digital-first mindset that won’t need to be implanted into them. That this is already kind of happening. It won’t always be a leadership-led decision-making to change the agency so much as the agencies will change with the people that are working in them.

Earlier, you touched on IoT and sensors. Where is the agency business with respect to virtual reality, especially as Facebook races to fill orders of its Oculus Rift VR headset?

It’s some of the most advanced technology out there and also still very new. On the other hand, it may be one of the technologies that helps bridge the online/offline gap better than any other. You can imagine a campaign or an experience that’s designed for virtual reality that allow people to have a more visceral sense of a product or service. It’s kind of a curious thing that some of the most advanced technologies are the ones that will bring consumers closest to actual physical experiences in many commercial aspects. And that’s what we’re going to see: we’re going to see a people trying to exploit the possibilities of virtual reality for any number of expressive sales context.

As evidenced by all the agencies providing walking tours through CES this week, agency professionals often tend to be as excited as anyone about the possibility of a new tech toys and tools. Is it a challenge not to be too seduced by the latest advance, particularly if it doesn’t have a practical use for clients right now? How should agencies balance the need to pursue new advances while not going down a dead end?

It’s relatively easy to see which sort of things stand a better chance of consumer and marketer adoption. One big key is whether a new device or technology requires someone to take more steps or less when achieving a result.

This is all just anecdotal with me, but what I’ve seen is that all the technologies around beacons have not yet proven to be as wonderful. The reason is because there’s a lot of friction, not a lot of seamlessness to their use. For example, people have to download an app, and then they have to turn on their Bluetooth receiver — that’s a whole lot of hassle. As a design, it’s not a real natural experience.

Or take Snapchat and all of those related messaging apps for marketing purposes. There are actually more people still communicating with their friends using simple text messages and sending pictures back and forth. There’s still greater appeal for something simple than using a media channel that is amendable to advertising and marketing.

Augmented reality is another exciting technology, but even after several years, it’s been a little bit difficult to generate significantly meaningful use cases in the commercial space. Still, the possibility is there, because it’s still so useful in the industrial space that eventually some of the design skills and the technologies that work with augmented reality will eventually find themselves in the commercial space in a way that will be far more useful than it has been so far.

Google Glass may still provide a wider example of the ways technology can be hyped as a marketing channel and didn’t initially measure up. In a larger sense, like augmented reality, Google is not giving up on it. There were still many very positive aspects to that technology, but I think they’re seeing more benefit in proving itself in an industrial context before it will be more of a public of a commercial context. So even if things don’t work right outside of the box, the ultimate influence could be important.

Google Glass was one of the first wearable items positioned as a potential marketing channel. That continuing experiment aside, how do you see the state of wearables and advertising?

Wearables are certainly here to stay. However, one of the things that’s a little bit hard about assessing the potential comes down to distinguishing between a horse race, between the various brands, to be able to say which brand is going to be successful. There is definitely progress in terms of people’s acceptance of using them in many contexts, and the applications for the data that is being collected by wearables is going to be felt by marketers.

As sensors get better, there was always this dilemma of where the lines are drawn between personal information that can be mutually beneficial from a consumer/marketer standpoint, and that information that isn’t.

Take the use of the Apple Watch. It’s apparently good for monitoring your health rate from a standpoint of doing athletics and or fitness versus monitoring your health rate from the standpoint of medical diagnostics.

It appears that Apple doesn’t want Apple Watch to get FDA approved for certain kinds of medical application. Even if might be able to be, but they didn’t want to necessarily then have to put every application that was developed for the Apple Watch into a regulatory environment that would sort of cloud its adoption. It was maybe too early or there was not enough distinction between products and, “This one is FDA approved and this one isn’t.”

The bottom line, and this is something people will be talking about during CES, even compared to a few years ago, the products are getting better, more useful, and more comfortable. People are adopting technologies like wearables and using them more, and the applications are getting better. And that is having enormous changes for how advertisers and consumers connect.

About The Author
David Kaplan David Kaplan @davidakaplan

A New York City-based journalist for over 20 years, David Kaplan is managing editor of GeoMarketing.com. A former editor and reporter at AdExchanger, paidContent, Adweek and MediaPost.