Dissrtation. New media platforms

Before Now

Are new media platforms threatening
the advertising industry?

Carla Ibáñez Barquet
MA Advertising
October 2011
Top Copy

Bucks New University
Faculty of Design, Media and Management
MA Advertising

Are new media platforms threatening the advertising industry?

Carla Ibáñez Barquet
Student ID: 21104206

VMC Tutor: Helena Chance
Date of Submission: 3rd October 2011
Word count: 8.502
Module number: ADM02

CONTENTS

Introduction ........................................................................................... 1
1. New media and what is new in advertising and why? …………….... 3
a) Case Study: Tesco Homeplus ………………………………….… 4
1.1 Social Networks madness ……………………………………………... 8
b) Case Study: 3 wolves T-shirt ……………………………….….…. 8
c) Case Study: 13th Street Universal ………………………………. 10
2. Do people engage with advertising differently using new
media?...................................................................................................14
2.1 Democratization of information ………………………………………. 14
2.2 Is Internet empowering us? ………………………………………...… 15
2.3 Shift on peopleʼs behaviour …………………………………………... 18
2.4 Consumers are empowered ………………………………………..… 20
2.5 How people engage with advertising? ………………………………. 21
d) Case Study: Glasses Direct …………………………………... 22
2.6 We will be googled… ………………………………………………….. 24
e) Case Study: Nike – The Girl Effect …………………………... 27
3. Changing Business models: compare new companies with
traditional advertising agencies ....................................................... 30
3.1 How media is affecting the advertising industry? …………………... 31
f) Case Study: Heineken Star Player ……………………………. 33
g) Case Study: Kleenex – Let it out ……………………………... 35
3.2 New advertising business models ………………………………….… 36
3.3 The new advertising landscape …………………………………….... 37
3.4 So are new media platforms threatening the advertising industry?.. 39
4. Conclusion …………………………………………………………………. 41
5. References
Bibliography ……………………………………………………….... 43
Webography ………………………………………………………… 44
Picture Credits ............................................................................ 47

INTRODUCTION

My iphone is responsible for waking me up every morning and it is also the last thing I
use before going to sleep. Google is my dictionary, encyclopaedia, GPS, bank of
knowledge and an entertainment source. YouTube, Megavideo, TED, etc are my TV.
Amazon is my bookshop. Barclayʼs Online Banking helps me to check all my money
movements and track my transactions too. Facebook is part of my social life, a way of
being connected with my friends, but also with my job and studies. My personal Blog is
a virtual space where I can express my opinions and share my thoughts. Skype allows
me to see and chat with my parents every evening before dinner. Therefore, I can say
that my computerʼs or smart phoneʼs screen are the window that I am always staring at,
and I can interact with them.

The range of media available to us is getting bigger and bigger; in other words the
meaning of the word media is nowadays wider than before. This project will analyse
new media platforms like social networks, mobile technology, the outernet, apps,
Youtube, Google, etc because they are responsible for the changes in peopleʼs
behaviour and as a consequence, a change in advertising.

This project aims to discover if new media platforms are threatening the advertising
industry, the changing business models, how societyʼs behaviour has changed and
predict a possible future for the advertising industry based on the new media platforms
and the digital impact. This dissertation will compare the traditional model of an
advertising agency with the new digital agencies or production shops. Questioning the
old and interrogating the quality of the new it will try to discover which future holds for
the advertising industry.

By conducting research into this field and finding out more about changes produced by
digital impact I intend to create an awareness and explain my opinion of what the
consequences are going to be and how this is going to reshape the future. That opinion
will be sustained with primary sources as interviews to professional advertisers working
in the industry now, the ones who are facing the changes.

1

The outcome of this dissertation will provide the reader with a theoretical and practical
understanding of how new media platforms are changing peopleʼs behaviour and which
direction is advertising taking to reshape the future industry.

2

CHAPTER 1
New media and what is new in advertising and why?

Despite the fact that all those technologies seem essential right now, we cannot forget
that it was in 1991 when Tim Berners-Lee invented the World Wide Web and in 1993
was accessible for people to use. Gradually the importance of the digital technology
has grown to the point that it is now an integral part of our lives and we trust it in so
many different ways.

To begin with, we can say that people nowadays is not only using the Internet as a tool,
actually digital technology is changing peopleʼs behaviour. A proof of that is the fact
that the majority of under-25-year-olds chat to friends on social networks via their
mobile phone while watching TV, according to a study by the marketing agency Digital
Clarity. Of the 1,300 UK people surveyed, 80% said they use their mobiles at the same
time they are watching TV, while 72% use social networks to communicate with others
on their mobile phones. The study identified Facebook and Twitter as the most used
social networks.1

Advertising has to be aware of the subtlest of changes in society and as we can see in
the results of that study, we are facing a dramatic change of habits and lifestyle. The
digital departments of the advertising agencies are now as important as the others and
even digital specialized agencies have been created.

As the Internet started developing we could perceive that what it was actually doing
was concentrating all the media and ways of communication in one single device.
Digital combines photos, music, data, video, social network, etc. For example mobile
technology integrates everything in one singles device. This new media platform is
clearly successful and the introduction of apps is one of the keys of this success. The
advertising industry is facing a big opportunity to reinvent the traditional ways of
approaching the customers. With Smartphone apps brands will have a whole personal
new channel to get to their consumers. Brands like Tesco Homeplus are already using
this platform in a revolutionary way.

1
http://www.digital-clarity.com/ a specialist digital marketing agency that polled over 1300
people under 25 from a cross section of the UK.

3

a) Case Study: Tesco Homeplus

Tesco in South Korea is called HomePlus. They needed to overcome their main
competitor: E-Mart. So their mission was becoming the number 1 without increasing
the number of stores. Korean people are the second hardest working people in the
world so they decided to approach these busy and tired people letting the store come
to the people. They created virtual stores in the subway. The display looked exactly like
the one in the supermarkets and each product had its own QR code. People just had to
scan the codes and the product was landed to their online cards. After the online
purchase is done the products were automatically delivered to peopleʼs houses. The
results were clearly positive: The number of new registered members rose by 76% and
online sales increased 130%. Homeplus became the number 1 in the online market,
being very close 2nd offline.2

Fig. 1 Korean boy purchasing an item scanning a QR code with his phone.

As we can see mobile technology is developing faster and getting into peopleʼs life
trying to become indispensable. An interesting statistic found online says the average
of Smartphone user spends 667 minutes a month using apps. But what is even more
shocking is that in 2010, 5 million apps were downloaded and experts predict that 21
million apps will be downloaded in 2013. The info graphic below shows in detail:

2
http://www.youtube.com/watch?v=fGaVFRzTTP4

4

Fig. 2 Statistic that shows the state of the mobile app world. Detailed Top smartphone
platforms and Top mobile phones. It also estimates the increase of downloaded apps in
the future.

5

Fig. 3 Stats showing highest rated apps, Top apps stores, Top mobile app categories
(USA) and Top mobile categories for 2012.

Meanwhile communication is changing from broadcasting to ʻnarrowcastingʼ. Previously
media was ʻpoint to multipointʼ, that means companies were the ones who delivered the
message to the public. Now we are talking about ʻpoint to pointʼ communication, which
means companies launch a message and it goes from one to another, there is a
response, an opinion. Digital creates dialog and mass media is becoming personal.3

3 th
Martin Runnacles workshop, 17 January 2011

6

Fig. 4 The graph pictures the different relationship between broadcaster and
consumer.

So the most important change that communication has experienced in the commercial
world is going from one-way communication to ʻpeer to peerʼ communication.
This means that groups of individuals are coming together to share, cooperate, and
even to organize collective actions with common purposes. That fact has always
happened in social now but now is happening in a commercial context.

Clay Shirky wrote in Here Comes Everybody: “When we change the way we
communicate we change society 4 and thatʼs exactly what is happening. New
generations decide their plans on Facebook, make the supermarkets come to their
places, never check the route to go to a place because they have an iPhone with
Google maps, show their work online and even run their business through the internet.
But more importantly, new generations have a voice at the same level as others, a
digital voice that makes brands react and advertising change.

An example of creating new business through the Internet could be Amandaʼs Hocking
case: she is a 26 years old writer who has been able to sell about 1,000,000,000 books
without any help. During a few years she tried to publish her books through a literary
agent but the result was unsuccessful. So she decided to sell her books directly on the
Kindle shop (available in Amazon), and as thereʼs no middleman, except the platform,
she gets the 70% of the benefit. As a result of that, Amanda has become the most

4
C Shirky, Here comes everybody, Penguin Books, London, 2008, p. 17

7

popular independent writer in Amazon, selling 100,000 copies per month, achieving
revenues of about $1,400,000,000 USD since last April 2010. 5

1.1 Social networks madness

Social networks have become a really powerful and influential media platform. The next
case study proves how peopleʼs behaviour is changing and the importance of this
platform.

b) Case Study: 3 wolves T-shirt

Fig. 5 Wolves T-shirt that became Amazonʼs bestseller.

This T-shirt became the Amazonʼs bestseller thanks to a funny comment made online
by an Internet user. According to Russell Dicker, a spokesman from Amazon, the sales
of the item raised 2300%.

5
http://www.businessinsider.com/amanda-hocking-2011-2

8

In 2008 Brian Govern a student from Rutgers University posted a satirical comment
about the T-shirt, highlighting that one of its attributes was the power of attracting
women. Thanks to www.collegeofhumour.com his comment went viral and more than
750 people have posted their own outlandish comments about the T-shirt. 6

Brands must adapt themselves to those changes, for example, Heinz made a limited-
edition flavour of tomato ketchup available exclusively through Facebook, making it the
first food brand to sell a product via social network. There were precisely 1,057,000
bottles of Heinz Tomato Ketchup with Balsamic Vinegar, which Heinz said was its first
limited-edition product. 7

Fig. 6 Screenshot of Heinz Facebook page launching its limited edition Ketchup with
Balsamic Vinegar.

6
http://abcnews.go.com/WN/story?id=7690387&page=1
7
http://www.telegraph.co.uk/foodanddrink/8361796/Heinz-tomato-ketchup-with-balsamic-
vinegar-a-review.html

9

Tim OʼReilly, computer book publisher talks about his vision of the future saying that till
now we had Web 2.0 but the future is Web 3.0, which involves people forgetting they
are using social networks, services and the Internet as consumers. People are creating
the web but without being conscious that theyʼre actually doing it. ʻOur phones and
cameras are being turned into eyes and ears for applications,ʼ 8 O'Reilly has written.
Thatʼs because “virtual” and “real” are now practically united in a sense of perception. A
campaign made by the agency Jung von Matt/Spree in Berlin shows a completely new
way of communicating lowering the boundary between digital and real. They were
trying to advertise the new 13th Street Universal and they wanted to engage people with
the thriller genre, the result is ʻThe Witness the first movie in the ʻOuternetʼ. The
concept ʻOuternetʼ, created by the German marketing firm TrendOne, means that
Internet is no longer subject to the screens because it has merged with the outside
world. 9

c) Case Study: 13th Street Universal – The Witness

In 2011 NBC Universal launch the new 13th Street Universal so the challenge was get
the audience engaged in the genre of thriller and crime like never before. The solution
was ʻThe Witnessʼ, the first movie in the Outernet. Viewers of all over Germany applied
on their website to be part of this exclusive event.

8 th
Article The Guardian by Oliver Bukerman, 15 of March 2011
http://www.guardian.co.uk/technology/2011/mar/15/sxsw-2011-internet-online
9
http://www.youtube.com/watch?v=Yis6is8v9jA&feature=related

10

Fig. 7 Screenshot showing the website where users could register themselves to play
The Witness.

The Witness begins in a hotel room in Berlin; they have to safe Nadia a prostitute from
the Russian Mafia. Using augmented reality technology, with GPS and special software
they developed for the iPhone, viewers can experience a real life film directly at the
crime scene. Everything begins when Nadia is kidnapped, then viewers turn to be part
of a thriller. The Witness will take the viewers through a journey all over Berlin. The
smart phone becomes an essential tool in order to stay in the game. They will have to
take important decisions and depending on those, one can be or the hero of the film or
the next victim of the Russian Mafia.

Fig. 8 Player using augmented reality technology with his phone.

On the other hand, nowadays every agency is concerned about the importance of
digital and social networks and it looks like something new, but it will soon become
conventional, as it is already part of our lives. If digital becomes conventional,
advertising should start thinking about using it as a tool to make better-integrated
advertising and increase effectiveness.

11

Advertising should be about what you do, not what you say. Itʼs good to use digital
technologies as a media because of the speed, coverage and engaging capacity, but
we have to think laterally. A Facebook page and a blog is not enough for a good brand
communication or advertising campaign. For instance, the Chalkbot Nike campaign
made by Wieden+Kennedy shows those ʻthinking differentlyʼ attributes that I want to
refer to 10. They are using the road as a canvas (real action) and people can send their
messages to be written on it and that is the engaging factor (digital technology).

Fig. 9 Road with peopleʼs messages. Fig. 10 Machine responsible for the
paintings

As Patrick Collister, ex Creative Director of Ogilvy, said in a conference on March 15th
2011: “People want ideas they can take part of, not messages anymore.”
If you only use the Internet in order to raise awareness and influence the consumer,
then you are forgetting the real utility of the web: to enable networks where people with
the same interests can share and cooperate for a common purpose.

The challenge that we have to face now is how we can more easily control whom we
want to share this information with. For example Facebook is an easy way of

10
http://www.youtube.com/watch?v=HmW-eGCrSxs&feature=related

12

communicating and moving information but we need help managing our connections
and selecting and controlling the information that we want to send to a specific person.
Whilst reading blogs I came across a sentence that sums up this argument: “The social
networking site that will do for the connections among people what the Web has done
for the connections among sites is awaiting its own Tim Berners-Lee.” David
Weinberger, co-author of the Cluetrain Manifesto 11, has written.

In the future the process of creating networks, advertising campaigns and
communication should be integrated and interactive. Most probably advertising will
increasingly have to sell experiences instead of products and the former will have to be
mutually beneficial, satisfying the values of the brand but also the people that the brand
wants to connect with. They will have to connect people with mutual interests and
engage them to our work. Make them participate; feel passionate about it in order to be
more effective and create a community of likeminded people.
The point of developing relationships in branding has been extensively discussed. For
example Guy Kawasaki, one of the original Apple employees responsible for marketing
the Macintosh, said: "Many companies waste millions of dollars trying to establish
brands through advertising... Brands are built on what people are saying about you, not
what you are saying about yourself. People say good things about you when 1) you
have a great product, and 2) you get people to spread the word about it." 12

Furthermore, integrated communication will also affect physical devices such as TV,
Radio, Computer, etc. Integration is the future. That means that homes will most
probably have one single device from which you may perform all the former functions.

11
The Cluetrain Manifesto is a set of 95 theses organized and put forward as a manifesto, or
call to action, for all businesses operating in a new connected marketplace. The book tries to
explain the impact of the Internet on both consumers and organizations. Rick Levine,
Christopher Locke, Doc Searls, and David Weinberger worte the manifesto in 1999.
12
http://www.allbusiness.com/company-activities-management/product-management-
branding/11736449-1.html#ixzz1XlPkUOcW

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CHAPTER 2
Do people engage differently with advertising using new media?

This chapter is about new media and its effects trying to analyse the actual technology
outlook. Another point will be how advertising is directly affected by those facts and
some examples will be given to support the arguments in a more practical way.

2.1 Democratization of the information

We live in fragmented times with an excess of information. This overcrowded world
makes competition a usual thing therefore people have a vast choice of products and
tones of information thrown at them. Information that is intended to help them to make
decisions gives them support and makes their lives easier.

Jay Adelson, CEO of the social content website Digg, in an article of The Sunday
Times gives a good definition of what is the democratization of information:

“Just like in a democratic society, the democratisation of information means that
content and information, from news stories to videos to music, get prioritised by the
collective vote of the internet community. I think of democratisation of information to
mean that every bit of information or content on the web has the same opportunity for
exposure or discovery as every other piece of content. Thus, for example, an obscure
blog or podcast has the same chance of exposure as a Wall Street Journal article. I
also take the democratisation of information to mean that everyone can have a voice in
what is deemed important or relevant or entertaining, versus only a few people making
those decisions on our behalf and filtering what we know about the world through their
own biases and view of how things should be.” 13

So democracy is applied in all possible levels. Brands have now to be aware of what
they say and how they act because consumers have a voice and they will probably
reply. Social networks are a new media platform where those conversations between
brand and consumers can take place.

13
J Adelson, CEO of Digg, article The Sunday Times.
http://business.timesonline.co.uk/tol/business/related_reports/business_ideas/article3364558.ec
e

14

Charlotte Mceleny, journalist for Campaign magazine, said in one of hers articles that a
recent research has revealed only a small minority of people complains to brands via
social media. But brands cannot ignore the channel, as it will become the most
important customer service tool.
What is true is that before calling to an expensive number people will eventually use
more and more social networks as a tool to communicate with brands. And if
Smartphones allow people to be online everywhere they go that will increase the
effectiveness of the customer service.
The research on Mcelenyʼs article did reveal that of those who had complained via
social network, only 40% had received a quick response. That means that more than a
half of costumers were unattended.

“Actively complaining is something carried out by the minority regardless of what
14
technology is involved. Whatʼs crucial is that this minority isnʼt ignored.”

Brands need to start investing on social networks the same resources they invest on
phone and email customer service; otherwise their image can be increasingly
damaged.

2.2 Is Internet empowering us?

“Infinite monkey theorem: Huxleyʼs theory says that if your provide infinite monkeys
with infinite typewriters, some monkey somewhere will eventually create a master piece
– a play by Shakespeare, a Platonic dialog, or an economic treatise by Adam Smith.” 15

Andrew Keen compares what it seems a joke to now foretell the consequences of a
culture that is blurring the lines between traditional audiences and author, creator and
consumer, expert and amateur. So we can compare Huxleyʼs theory with our Web 2.0
World where the monkeys are the Internet users and the typewriters, personal
computers. And instead of creating masterpieces “they are creating an endless digital
forest of mediocrity.” 16

14
Charlotte Mceleny at Campaign magazine http://www.nma.co.uk/opinion/social-media-will-be-
a-key-customer-service-channel/3019722.article
15
A Keen, The cult of the amateur, Nicholas Brealey Publishing, London, 2009, p. 2
16

15

The Internet has brought democratization to our culture but that doesnʼt necessarily
mean itʼs positive. “The cult of the amateur has made it increasingly difficult to
determine the difference between the reader and the writer, between artist and spin
doctor, between art and advertisement, between amateur and expert. The result? The
decline of the quality and reliability of the information we receive, thereby distorting, if
not out rightly corrupting, our national civic conversation.” 17

For example sometimes, citizen journalists are able to give something traditional
journalists just canʼt because of money and time constraints. During the tsunami in
2004, Bloggers were able to give better information than some news agencies because
they were on the scene and could offer photos, videos, and first-person opinion and
detailed information. Bloggers became the source of information for some news
agencies.18 Another example is teenagerʼs beloved Justin Bieber which became
famous because in 2008 Scooter Braun, music industry manager, came across
Bieberʼs videos on Youtube.19

On the other hand, Anderson in his book The Long Tail defends that self-created
content will somehow result in an endless village of buyers and sellers. He believes in
the free market and new technology will bring nothing else but abundance.

Digital technology is inescapable in the 21st century; we cannot just ignore it. And it is
also an incredible way of sharing information and keeps the world connected from one
side to the other. Kevin Kelly told Siliconʼs Valleyʼs TED Conference in February 2005,
ʻYou can delay technology, but you canʼt stop itʼ. 20
Andrew Keen accepts that statement but he thinks that the challenge now is to protect
the legacy of our mainstream media and two hundred years of copyright protections
within the context of twenty-first-century digital technology. The main goal should be
preserve the culture and its values while we enjoy the benefits that Internet provides to
all of us. The most important thing is to find a way to balance the best of the digital
future without destroying the institutions of the past.

17
18
http://mediacrit.wetpaint.com/page/Blogs+and+Citizen+Journalism%3A+The+Effect+on+Our+
Culture
19
http://es.wikipedia.org/wiki/Justin_Bieber
20
http://blog.ted.com/2009/08/18/how_technology/

16

A good example of the fact that the democratization of information can quickly
degenerate into intellectually negative egalitarianism is Wikipedia. An encyclopaedia
made by amateurs that everybody would consult eventually.

The idea is to create new media platforms that offer the best of both of the new and old
media worlds. In that way “Web 2.0 technology can be used to empower, rather than
overshadow the authority of the expert.” 21

A really old case is the music industry that had to rethink its business model in order to
survive the piracy and digital downloading. The success of iTunes shows that
consumers are willing to pay for music when is fairly priced and easy to buy. That
business model could not be possible without new media platforms and of course itʼs a
consequence of its appearance.

So with all that freedom and accessibility how are we going to reassure that west
culture will behave with Web 2.0?

“We need rules and regulations to help control our behaviour online, just as we need
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traffic laws to regulate how we drive in order to protect everyone from accidents.”

Technology doesnʼt create geniuses from scratch. It should be considered as a new
tool of self-expression otherwise thanks to the democratization of culture generated by
the Internet, artists would not be able to sell any creative work because it will eventually
loose its value.

Andrew Keen claims in a really clear way his own opinion and solution:

“Instead of developing technology, I believe that our real moral responsibility is to
protect mainstream media against the cult of the amateur. Letʼs not be remembered for
replacing movies, music, and books with YOU. Instead letʼs use technology in a way
that encourages innovation, open communication, and progress, while simultaneously
preserving professional standards of truth, decency, and creativity.” 23

21
A keen, The cult of the Amateur, Nicholas Brealey Publishing, London, 2009, p. 188
22
23

17

Nicholas Carr, respected journalist, in a cover article of the Atlantic Monthly argues that
the Internet is making our brains get used to read short posts and instant messages,
the shorter the better. Internet has been eroding our ability to concentrate and read a
whole book or long article without stop in the middle and start thinking about what else
can we do.

“Instead of readers the digital revolution is transforming us into skimmers”. 24

2.3 Shift on peopleʼs behaviour

According to a statistic released in December 2010 by Forrester Research: the average
U.S. consumer now spends much time online than watching television. “Social
networking and online video are among the top catalysts for the shift in attention.” 25

People who donʼt watch TV anymore, they spend time online with their laptops or
mobile phones. With mobile networking, the world becomes smaller and smaller. There
are plenty of possibilities to explore with the mobile technology. Foursquare is a good
example of engagement. This location-based social networking allows consumers to
check-in their favourite places and then each check-in awards the user points and
sometimes “badges”, depending on how often they go and consume.

24
http://www.theatlantic.com/magazine/archive/2008/07/is-google-making-us-stupid/6868/
25
B Solis, Engage, John Wiley & Sons, New Jersey, 2011, p. 65

18

Fig. 11 Foursquareʼs app interface.

Technology and behaviour are related as well:

Fig. 12 Graph that illustrates how technology changes people and people changes
technology.

When technology changes peopleʼs behaviour does as well, a clear example of that is
what is happening in our society with social networks, smartphones, tablets, etc.
But people also have developed different needs along the history that have made
technology change and adapt to them. For example nobody could imagine the success

19

of text messages in mobile phones, but suddenly people start using it as much as
normal calls.
The touch screen technology makes people want to interact. Technology is making
sense with humanity. Apple, for instance, is humanizing technology. Facebook and
Twitter are successful because they are creating conversations.
Google search is different for everyone, it analyses what it can be better for your
interest, relating to your past searches or country of residence, etc.
Another example is Konnect the new video console simpler than Wii, works only with
the movement.

“If technology is accessible everybody can join. Is going from exclusive to inclusive. It
is closing the gap between high tech and normal people.” 26

2.4 Consumers are empowered

I have argued that communication has shifted from broadcasting to narrowcasting
communication. That fact empowers consumers to decide what they want and what
they donʼt. There is a vast choice of content to snack on: from advertising, films, TV
programmes, books, magazines, music and gaming to the whole range of Internet
resources. That variety has enabled consumers to choose entertainment and
information that is relevant to them, in a way and at the time that suits them.
Furthermore, they can cut what is irrelevant.

Social networks have provided a focused target audience because advertisers can
track which interests people have or what they need.

“With broadcast media the strategy was to push information at audiences offline. With
digital media the aim is to pull customers towards information online. Now push and
pull methods tend to be used in conjunction through multimedia programming and
advertising.” 27

26
Matt Longstaff, creative copywriter at AKQA.
27
P Springer, Ads to Icons, Kogan Page, London, 2009, p. 244

20

Online there is a lot of material, websites and content designed specifically to entertain,
because entertainment attracts a lot of web traffic and makes sites an attractive place
for advertisers.

“We are witnessing a shift in power. Once tightly controlled by publishers,
broadcasters, and corporations, the power to publish and connect messages and
stories to people was considered a luxury only a matter of a few years ago – a privilege
many of us never would have experienced without the introduction of social platforms.
Technology is a change agent, and the capabilities and accompanying benefits that
social media offers are liberating our channels of influence. Information is now
democratized and we the people are making our voices heard.” 28

Thanks to social media consumers have now a voice and brands are not the only ones
that have influence. Democracy is reaching other levels like commercial
communication. That is somehow beneficial for advertising because people are
conscious of what is advertising and what they are trying to do, so it is easier for
advertisers to be ignored and be less influential.

2.5 How people engage with advertising?

“Tell me and Iʼll forget. Show me and I might recall. Involve me and Iʼll remember.” 29

Digitisation has made an old dog learn new tricks. Thanks to digital technology the
relationship between advertisers and consumers has changed:

“Digital has allowed advertisers to reach customers in new ways. It has allowed
advertisers to create interactive catalogues, set up customer support and set up
information channels and has introduced the possibility of company-to-customer
dialogue.” 30

According to the book Engage by Brian Solis, sharing pictures online encourages views
and peopleʼs interaction and as a result pictures become into social objects. For
example at the time of Hurricane Katrina, the American Red Cross launched a social

28
B Solis, Engage, John Wiley & Sons, New Jersey, 2011, p.108
29
30

21

media initiative to track peopleʼs sentiments about the organisation – related issues
and to strengthen their relationship with the public. They created a blog, Twitter,
Facebook and an active Flickr community. At the time of writing, there are 393 Red
Cross Flickr members and 1,627 images have been posted. But itʼs never just about
one social media tool, the key of success is being able to create multiple touch points
related with each other giving a sense of community, making people feel part of
something.

“Participation is the key to growing the community and ensuring its integrity and
associated activity.” 31

These days when people have some problem with a brand they donʼt necessarily tell
their friends about it. They just go online to broadcast their displeasure. This is an issue
for brands because bad news travels fast and the average person has around 120
Facebook friends, plus Twitter followers. So it is really important for brands to decide
how to react in front of a complaint because ignoring the problem will usually make it
worse. The following case study shows a clear example of that fact: 32

d) Case Study: Glasses Direct
A man called Thomas, Account Manager in LBI, explains in his Blog that he had a
problem with an order with Glasses Direct. He sent his sunglasses off to them to have
new lenses put in but when they returned they were wonky, one of the arms had been
damaged. He sent the glasses back but when he received them they were still wonky.
He was so annoyed and he tweeted about it:

Fig. 13 Thomas message to Glasses Direct.

31
B Solis, Engage, John Wiley & Sons, New Jersey, 2011, p.47
32
http://www.thomassays.co.uk/dealing-with-complaints-via-social-media

22

And Glasses Direct replied to him and they added a Youtube link, where all the staff
was apologising. 33

Fig. 14 Glasses Direct tweeted Thomas back.

Fig 15 Screenshot of the video that Glasses Direct sent to Thomas.

With a simple action they turned one negative situation into a positive one. And the
results were 300 views, 20 retweets, a link on Thomas Facebook page and a little
boost of positive press. 34

The challenge for any brand is first getting noticed and then engages with people being
able to catch their attention, have a response and hopefully initiate a relationship.

33
http://www.youtube.com/watch?v=vYFV80dXoGs&feature=player_embedded
34
http://www.thomassays.co.uk/dealing-with-complaints-via-social-media

23

2.6 We will be googled…

With social media comes great responsibility. Everyone inside an organization is
responsible at some level for the branding and public relations. Everything an
employee does online or offline builds the brand perception of the company he
represents. It is really important to build online trust in order to retain customers and
make them talk about the brands they like and trust. Some key points are: add content
to the engagement, create a story and allow participation. Be transparent, donʼt lie and
know when to apologize if it is necessary. Respect your consumers and protect
confidential information. 35 The picture below shows a detailed path of how online trust
is built:

35
B Solis, Engage, John Wiley & Sons, New Jersey, 2011, p. 123

24

Fig. 16 Detailed path of how to build online trust.

Another landscape where we can see the importance of trust is Cannes 2011. The
majority of rewarded campaigns were based in ʻmaking projects not campaignsʼ. In
other words, brands are doing something ecologic, non-profit, etc, instead of only
selling. Advertising for the good is the new undercurrent, like the last Leviʼs campaign

25

ʻGo forthʼ by Wieden + Kennedy trying to rebuild a poor and abandoned village of the
US. 36

Fig. 17 Two posters of the Leviʼs ʻGo Forthʼ advertising campaign.

The democratization of information is another danger that brands have to keep in mind.
Having a lot of information available to everybody carries huge responsibility and it is
harder to lie. A consequence of that fact is that brands have to change their behaviour;
they have to be legitimate online and offline.

36
http://www.youtube.com/watch?v=p63BwVm_ojw

26

“For instance Innocent brand is the proof that acting nice can be more powerful than
37
Coca-cola doing a lot of cool advertising.”

Brands like Nike can also do campaigns transmitting good values besides promoting
their own image, like for instance, ʻThe girl effectʼ (Wieden+Kennedy)38.

e) Case Study: Nike – ʻThe girl effectʼ
Nike launched a campaign that proposed a girl as the solution for poverty, hunger and
sickness in the world. They said if you invest in a 12-year-old girl she will be able to
avoid HIV because she will have money to visit a doctor regularly and she will not have
to sell her body to maintain her family. She will stay at school where she is safe, she
will use her education to earn a living, she can get married and have children when she
is ready and her children will be healthy as she is. If this continues for generation after
generation will mean: 50 million 12-year-old girls in poverty equal 50 million solutions.
This is the power of the girl effect.

Fig. 18 Screenshot of ʻthe girl effectʼ website.

37
Interview Matt Longstaff, creative at AKQA
38
http://www.youtube.com/watch?v=C44BOxKhwsQ&feature=related

27

Fig. 19 Screenshot showing how people can help.

Fig. 20 Screenshot showing Facebook and Twitter representation.

In an interview with Matt Longstaff, creative at AKQA, he mentioned that projects are
not going to replace campaigns but the former help to reinforce any brand.
He said that brands are not anymore two-dimensional. The new trend is 3D brands,
which are experiential, allowing consumers to have a relationship with them.

In the interview to Craig Mawdsley he ensured that projects are not only going to stay
but grow bigger. He justified this with two main arguments: first, agencies like doing

28

them and second, clients like having a good brand image. Those ideas are more real,
thatʼs why they work better. Projects help to ground brands and they are easy to
understand for both consumers and clients.

29

CHAPTER 3
ʻChanging business models: from new companies to traditional advertising
agenciesʼ

New media platforms are changing all the business landscape that we use to know.
Every business had to adapt itself to the new technologies but what it is even more
interesting is that, this technology has enabled the birth of new forms and types of
business. The entrepreneurs simply change the way people think about something,
they probably make everyday things easier. They are now able to create businesses
that could not have existed before like Facebook, Google or Amazon. These
businesses succeed not for the concept but the execution, all of them are based on
things people love to use, human ways of relating with other people, conversations,
trade, education, etc.

“Itʼs not about what you destroy itʼs what you create. Itʼs about seizing changes in
technology, regulatory changes, and changes in how consumers are behaving, so you
can do something much more efficiently – do it in a completely different way.” 39

The creators of limited products that nowadays have been digitised have to find the
way to survive in a new world where anyone can create similar products with really low
cost budget.

“The Internet created a new physics of business: a fundamental change in the rules of
who can compete with whom, and how and where they can compete. It allowed
entrepreneurs to apply radical operating models to traditional businesses and to create
businesses that simply couldnʼt have been conceived before. For example, Betfair has
been able to create a completely new type of gambling company. Skype can operate
as a global telecoms company, with paying customers around the world, serviced by
only 320 staff.” 40

Businesses that believe that the historic strength of their brands reassures their
success they are wrong. The key for survival is innovation; every single business has

39
Niklas Zennstrom, one of the founders of Skype speaking on stage at DLD in Hamburg,
February 2010.
40
S Waldman, Creative Disruption, Prentice Hall Pearson, Great Britain, 2010, p. 17

30

to adapt itself to the society needs. And they cannot forget that peopleʼs behaviour is
constantly evolving and technology just makes it easier.

Polaroid for example failed, they thought people would continue loving the instant
technology therefore they avoided the shift to digital.

So how all these changes will affect advertising? What are ad agencies going to do?

The record labels, newspapers, retailers, directory businesses, ad agencies and
publishers that will succeed in the future they will do so, because they will continue
reinventing themselves, they will prioritise innovation in front of the other values. For
every disruptive action, there is a creative reaction. Thatʼs how entrepreneurs get new
opportunities to enter in the market and provide fresh innovative blood to any kind of
industry. 41

3.1 How media is affecting the advertising industry?

If we compare advertising from the 1960s to the advertising from 2011, we will notice
that really important statements have changed. For example ad agencies had more
control and now audiences are the ones who have control. Before advertising agencies
used to design messages to people but now people designs messages to ads. In the
60s advertisers used to see people as consumers and now audiences have much more
power, they are consciously aware of the existence of advertising so they demand
much more than information, they want experiences.

41
S Waldman, Creative Disruption, Prentice Hall Pearson, Great Britain, 2010, p. 217

31

Fig. 21 Comparison between advertising in the 1960s and advertising in 2010.

Following Craigʼs Mawdsley presentation at AMV BBDO, he mentioned some really
interesting points about the future of advertising 42. He questioned the way of producing
ads for example: reducing the media budget and then spend more money on producing
a great ad and put it on Youtube. That is already happening but in his opinion that is
not the answer, it is just transitional.

42
Head of planning at AMV BBDO

32

“It has been a shift from hierarchy to network. We donʼt have to be in the top, we have
to be in the middle of a conversation.” 43

So we can say that engagement is the key of success. We need to make people
participate and make them feel they are part of something. Craig put some examples to
justify that engagement also needs content (Mother: Eurostar – Somers Town),
participation (AMV BBDO: Doritos – ʻKing of adsʼ) and earned media that means for
instance that Old Spice – ʻSmell like a manʼ campaign has never been seen on TV but
The Sun made a parody of it.

The following campaign is a great example of a good engagement process. 44

f) Case study: Heineken Star Player

An iPhone app designed to let fans interact in real time with football matches of the
UEFA Championʼs League. It is really easy to use. You just download the app; create a
simple profile for yourself and ten minutes before the match starts it opens up for play.
The game is sync with the time on TV and allows players to predict which team will
score first, if it is going to be corner, red card, goal, etc. You also can see your friendʼs
profile and check who is the best.

43
Craig Mawdsley, Head of Planning at AMV BBDO
44
http://www.youtube.com/watch?v=-QO8IYm2xVo&feature=related

33

Fig. 22 Heinekenʼs app interface.

So are we living in the golden age of advertising?

Fig. 23 U.S. Advertising Expenditures in 1860 vs. 2000s.

Probably advertising never has been in such over communicated era. Traditional media
are still on but new media technologies are rising with no sign of stopping. Agencies
have to be careful with the use of digital. Making a Facebook page for the sake of it is

34

not profitable because there is lack of content. A good digital agency is the one that
thinks digitally. Advertisers have to treat media with respect, not just because is there it
means they have to be on it. Is not about shouting messages, is about having
conversations. In an interview with Matt Longstaff, creative in AKQA, he came up with
a good example to explain that fact: Lynx advertising shows an imbalance in the use of
media. Their proposition doesnʼt link between TV and Digital. In TV ads they say Lynx
is all you need to attract women but in the online version you can see is giving guys
advice about how to be more successful with them. Advice that you are not supposed
to need if you use Lynx following what the TV ad says.
An example of a balanced use of media is the Kleenex campaign ʻLet it outʼ made by
JWT London.

g) Case Study: Kleenex – Let it out

They made a TV ad that shows a psychologist sitting in a couch in different streets of
London. People approach him and start explaining problems or experiences, sad or
happy feelings doesnʼt matter but they all ʻlet it outʼ with Kleenex. All people need to let
it out itʼs a good listener and Kleenex tissues. 45

Fig. 24 Screenshot of a frame of the Kleenex ad.

45
http://www.youtube.com/watch?v=u5cPulLXiLA&feature=related

35

And then when the consumer visits the website, it makes sense, because they offer to
the user the possibility of reading stories about other peopleʼs problems, test their
emotions express their feelings or give their support to other people.

Fig. 25 Screenshot of the Kleenex website showing the ʻlet it outʼ campaign.

3.2 New advertising business models

The advertising industry is inevitably related with technology. There are different
advertising agency models:
- Traditional ad agencies: AMV BBDO, Ogilvy, DDB
- Integrated agencies: Glue
- Larger digital agencies: AKQA
- Digital production shops: Mofilm, Idea Bounty

It is important to keep in mind that people engage with ideas not channels, therefore
any type of agency has to be driven by focusing on good ideas.

The head of planning of AMV BBDO, Craig Mawdsley, affirmed that “we are going to
fail more often now” because with the traditional model of advertising the demand of

36

creation was equivalent to 90% and the demand of fulfilment about 10%. On the other
hand the online model demands 10% of creation and 90% of fulfilment. In other words
engaging with people and rewarding them with an experience is what is on demand
nowadays.

3.3 The new advertising landscape

Internet and new technologies have made possible the creation of companies like
46
Mofilm or Idea Bounty. Mofilm is divided in Mofilm Social which helps big brands
become better listeners to on-line conversations and Mofilmpro which offers brands the
opportunity to create higher quality video faster than traditional methods. They have a
registered community of 30,000 creative filmmakers thinking on any brief. Usually it
takes between 4-6 weeks to finish a project instead of 4-6 months time needed by a
traditional advertising agency, because working directly with Mofilm eliminates all of the
bureaucracy and administration.
They call themselves: “The Worldʼs Biggest Creative Department”. Mofilm can help
brands to produce any form of video content: TV commercials, sales support material,
virals, online content, trade stand shorts, etc. Professionals like David Alberts, former
chairman and executive creative director of Grey, and Jon Landau, american film
producer, ensure that every video produced is the best material possible and the
quality is excellent as well.

Idea Bounty is another digital production shop. They define themselves like that:

“For clients, Idea Bounty is the simplest way to hire 1000s of creatives and only pay for
the Ideas you want. For creatives it's an amazing platform that allows you to pitch on
various briefs.

Their bottom line: “Clients get the best Ideas and creatives get paid for those
Ideas.” 47

They use the Internet as a channel to trade creative solutions to business problems.
Clients only pay for what they consider is the best but they have a lot of different

46
http://www.mofilm.com/
47
http://www.ideabounty.com/

37

creativeʼs working on it. On the other hand creatives can have thousands of
opportunities to demonstrate how good they are and get paid for it.

Traditional agencies had to introduce new roles within the advertising profession as:
Data planner, Brand planner, Media planner, Customer Insight specialist,
Technologists, Project managers, Flash Expertise, HTML programmers etc.

“Digital technical directors (DTDs) oversee the programming of websites, virals and
other digital communications. They have to understand new ideas that are emerging in
the field of digital technology, and have a clear grasp of how the capabilities of new
hardware and software might create potential for advertising, as well as how specific
clients might use them.” 48

Dave Bedwood and Sam Ball are Founder/Creative Directors and digital advertising
team at digital agency Lean Mean Fighting machine. Sam and Daveʼs agency
produces online advertising. They work as an art director/copywriter team. They initially
use a traditional way producing creative ideas and then they make the drafts that later
will be developed digitally by designers, filmmakers and programmers.

“Working online also requires copywriters to be skilled in maintaining a dialogue (rather
than simply imparting messages) and have an ability to extrapolate campaign ideas
through different types of online experiences. Digital art directors have to ensure that
URL links and functional information are clear and that both the visual language on
screen and movement between screens are consistent.” 49

New breeds of advertising agencies have also emerged. One such agency in the UK is
Quiet Short Films. They describe themselves as programme makers and they produce:
TV commercials, TV programmes, virals, website MPGs and many more. Quiet Storm
operates through existing channels and new margins of mass communication. 50

48
49
50

38

3.4 So are new media platforms threatening the advertising industry?

“New technology and the new economy are creating turmoil in advertising, challenging
ad agencies to rethink the way they do business. Some industry observers predict
agencies will disappear. Others say the new economy and technology will provide
greater opportunities for agencies to grow and prosper.” 51

Experts say that to survive, agencies must serve as "strategic partners" in helping
advertisers to promote dialogue between brands and customers. Sean Carton, chief
creative officer at Idfive in Baltimore, wrote in ClickZ.com, a digital marketing website
saying: Agencies in the future must "provide high-level strategic guidance that clients
need in a media-chaotic environment". According to that last statement we can say that
strategic planning will become more and more important.

Craig Mawdsley, head of Planning at AMV BBDO said in a presentation the past 22nd
of July that the role of planning is changing in the age of engagement. It is becoming
more important but planners have to be constantly changing and the motivation that
fuels that change is the fear of becoming obsolete.
If “markets are conversations”,52 planners are the ones responsible for knowing the
human being in all its senses and create a good strategy to engage with him.

According to Rob Steeles, copywriter in 23red (integrated agency), new media
technologies only threatens an agency if this one is to slow to face how the consumer
responds. Although digital production shops are doing well, he thinks there is always a
need for a professional brand campaign, comparing new media platforms with the new
direct response. In his opinion the birth of these new kind of businesses could bring two
things: Fresh new creativity, which is always interesting, or the fact that clients start
buying poor advertising created by them. Maybe the solution is matching the
advertising agencies with the fresh creativity produced by new media companies
avoiding poor advertising. The constant need for knowing whatʼs new is vital thatʼs why
having a technology department like Ogilvy Labs is completely necessary.

51
http://www.suite101.com/content/future-ad-agency-business-models-
a112454#ixzz1RuVkkKze
52
F Levine, C Locke, D Searls & D Weinberger, Cluetrain Manifesto, Perseus Publishing,
Cambridge, Massachussets, 2001

39

AKQA is a digital agency and their opinion about that topic is also really relevant. In an
interview with Matt Longstaff, copywriter and conceptist in AKQA, he affirmed: “Expert
knowledge prevails. Of course ideas come from anywhere but still an advertising
agency knows exactly what to do. An agency with a long relationship with a client
wants to benefit him not only win awards. In the other business model (Mofilm, Idea
Bounty) the attitude of the creatives can be more selfish, working on a project to put in
their portfolio rather than satisfying a client.”

In his opinion the Mofilm business model is more likely to make art rather than
advertising, and the latter is about making money not art.

In AKQA teams are divided in the brands they are working for. All of them headed by a
creative director. AKQA is relatively young (12 years) so a big threat they are facing is
the fact that traditional advertising agencies are doing good digital advertising like for
example AMV BBDO, which is investing strongly in digital technologies.

Matt thinks the use of digital technology is going to grow bigger but is not going to
conquer other fields as print. But eventually TVʼs will become smart products. Microsoft
CEO Steve Ballmer said in an interview that all traditional media, including television,
radio and print, would disappear within a decade. It will all morph into a new
personalized media environment that will be delivered digitally over the Internet: “the
consumption of anything we think of as media today, whether it is print, TV or the
Internet, will in fact be delivered over IP and will all be digital.” 53

Big agencies have more money to experiment with new technologies but it is harder for
them to shift because they are earning a lot of money with big TV budgets. In contrast,
small agencies can easily change but the donʼt have the money to invest.

53
Microsoft CEO Steve Ballmer.
http://broadcastengineering.com/news/ballmer-predicts-media- dissappear-1022/

40

CHAPTER 4
ʻConclusionʼ

Marketers should stop thinking about consumers as simply a group of people. They
have to start imagining these people they want to target, as a powerful network that
shares common goals and concerns. They have to find out how the values of a brand
could fit in the collective interest of this network and make it beneficial for both parties.

It is clear that the business model of advertising is constantly mutating and new breeds
of advertising agencies are being born. The opinions of different experts or professional
advertisers are diverse. What it is for sure is that the industry is facing a big change
due to the implementation of new technologies in peopleʼs everyday life.
Nowadays traditional advertising agencies are still powerful but the competition is fierce
and innovation is the key of success.

In conclusion, new media platforms can be a threat for advertising if the industry
doesnʼt update its skills at the right time, if it doesnʼt prioritise innovation and if it
doesnʼt have enough motivation for the change in order to avoid becoming obsolete.
In my opinion new media platforms are an opportunity for the advertising industry
instead of a threat. Because new media is giving to advertisers the opportunity to
become something more than broadcasters, they can now influence people having
conversations. People would be aware of them but still they will like them if they know
how to do the right thing. The business model will evolve mixing traditional and digital
aspects by now. Integrated agencies may be the future of advertising business model.
After research we can see that digital production shops as Mofilm or Idea Bounty are
really creative and powerful companies but still not a direct threat for the advertising
agencies as we use to know.

We can say that the highlight of digital technology is that it has given a voice to society
at large. If brands now have to protect their images and be aware of peopleʼs opinions,
that means in future we will use advertising and communication not only for a
commercial purpose, but hopefully also to change the world for the better.
Nowadays advertising is already helping to change peopleʼs behaviour in a good way,
like the Nike Girl Effect by Wieden+Kennedy, mentioned in Chapter Two.

41

As advertisers we should take advantage of the substantial power that we have and
sell experiences to people that make their lives more exciting.
We have the tools, we have digital technology, but the most important thing is peopleʼs
voice, action and reaction towards our ideas. In the future of commercial
communication and advertising, things are going to change. However, what will never
change is the importance of good ideas. And now more than ever we have the
opportunity to create strategies that will make people believe in things and trust them
by being part of the process.

42

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Matt Longstaff, creative at AKQA – (26/07/2011)

Craig Mawdsley, head of planning at AMV BBDO - (08/09/2011)

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46

Youtube, Glasses Direct
http://www.youtube.com/watch?v=vYFV80dXoGs&feature=player_embedded

Youtube, Leviʼs – Go Forth
http://www.youtube.com/watch?v=p63BwVm_ojw

Youtube, Nike Foundation Case Study
http://www.youtube.com/watch?v=C44BOxKhwsQ&feature=related

Youtube, Heineken Star Player
http://www.youtube.com/watch?v=-QO8IYm2xVo&feature=related

Youtube, Kleenex Case Study
http://www.youtube.com/watch?v=u5cPulLXiLA&feature=related

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Fig. 4 Communication - Martin Runnacles workshop. (17/01/2011)

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47

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11/09/2011)

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Fig. 10 http://www.flickriver.com/photos/tags/tourdefrance2010/interesting/ (Accessed
on 11/09/2011)

Fig. 11 http://www.uberbin.net/archivos/redes-sociales/la-evolucion-de-foursquare.php

Fig. 12 Authorʼs design (Created on 14/08/2011)

Fig. 13 http://www.thomassays.co.uk/dealing-with-complaints-via-social-media



Fig. 16 Path for building Trust - Source: Matt Longstaff, creative at AKQA (Accessed on
28/07/2011)

Fig. 17 http://stylefrizz.com/201007/levis-everybodys-work-is-equally-important-go-
forth-campaign/ (Accessed on 01/07/2011)

48

Fig. 18 http://www.girleffect.org/ (Accessed on 14/09/2011)

Fig. 19 http://www.girleffect.org/ (Accessed on 14/09/2011)

Fig. 20 http://www.girleffect.org/mobilize/connect (Accessed on 14/09/2011)

Fig. 21 http://www.chrisrawlinson.com/2010/11/the-golden-age-of-advertising-
infographic/ (Accessed on 30/07/2011)

Fig. 22 http://www.contagiousmagazine.com/2011/04/heineken_6.php (Accessed on
01/07/2011)

Fig. 23 http://www.chrisrawlinson.com/2010/11/the-golden-age-of-advertising-
infographic/ (Accessed on 30/07/2011)

Fig. 24 http://www.youtube.com/watch?v=u5cPulLXiLA&feature=related (Accessed on
15/09/2011)

Fig. 25http://www2.kleenex.com/se/Let-It-Out/Experience-The-Release.aspx

49

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