Radio has been way too timid in its reaction to the online ad industry: Bob Hoffman | radioinfo

Radio has been way too timid in its reaction to the online ad industry: Bob Hoffman

Friday 26 September, 2014

“I’m Bob and I’m here to talk about bullshit…

I spent 41 years in the agency business. If you think you’re full of shit, I have a lifetime achievement award in it... my credentials are impeccable.”

 
NAB RadioShow keynote speaker Bob Hoffman told delegates that there is too much bullshit these days about consumer interaction with brands and about the success of internet advertising.
 
In an entertaining and expletive laden keynote, Hoffman challenged the notion that consumers want to have a relationship with brands and questioned the honesty of online advertising sales pitches.
 
“There are people in my business who believe that consumers are in love with brands and want to be personally engaged with brands... What! Dude, get a f##kin’ girlfriend! People are not ‘joining the conversation about brands,’ they’re having conversations about cats or almost anything else except brands.”
 
radioinfo’s reporter at the conference says Hoffman told delegates that “an astounding amount” of what the experts have said about marketing, internet advertising and media in the past ten years “has turned out to be baloney.”
 
Hoffman said the advertising industry has become “the web’s lapdog,” by “irresponsibly exaggerating the effectiveness of online advertising and social media.”
 
Like the little boy in the story about the Emperor’s New Clothes, who saw the reality that the emperor was naked while everyone else was too afraid or confused to admit the truth, Hoffman questioned some of the established “myths” that surround internet advertising.
 
Hoffman was not saying that the internet and social media are not effective, but he was questioning the way internet advertising is sold and the truth of the figures quoted by online ad sales people.
 
“Yes, there have been amazing changes in technology and communication and they have caused uncertainty, chaos and pain. The changes were supposed to bring radical changes in consumer behaviour but they have resulted in only small changes at most.”
 
Hoffman accused internet and social media marketers of exaggerating the effectiveness of online advertising in the face of facts that prove otherwise.
 
The assertions and opinions of experts are masquerading as facts,” he said, then began to question the so called facts and figures behind what internet advertising experts have said. “No one ever goes back and checks up on what they said. Today we will.”
 
Assertion 1: We have reached the end of traditional advertising and mass marketing.
 
“Apparently they forgot to tell Apple, which sold 200 million iTunes downloads that year via mass marketing. Every square inch of the planet is covered with advertising and these schmuks are telling us it’s dead?”
 
Assertion 2: The 30 second spot is dead because of interactivity and disruption.
 
“It actually turns out that consumers have no interest whatsoever in interacting with advertising. Online banner ads have a click through rate lower than one in a thousand. This is not interactivity, it is absence of interactivity…
 
“Here are some things you are more likely to do than click on a banner ad: you’re more likely to complete navy seal training than click on a banner ad; you’re more likely to have your application to Harvard accepted than click on a banner ad; you’re more likely to survive a plane crash than click on a banner ad.
 
“This is one of the great advertising delusions of all time.
 
“What’s worse…among the few click that do occur, an astounding amount are fraudulent. A report by CNet says that only 38% of traffic on the web now is human. The rest are bots, scrapers, spammers, and other impersonators.”
 
Hoffman said the “amount of fraud” being perpetrated on advertisers by what he terms ‘online scammers’ is “amazing.”
 
“A recent study found that 54% of display ads, paid for by advertisers between May 2012 and February 2013, never appeared in front of a live human being.” If the results are projectable it means that about $7 billion dollars worth of online advertising costs spent in the US “probably used some degree of deception or fraud,” said Hoffman.
 
Assertion 3: Social media will kill advertising.
 
“When I question this they say, he’s just an old traditional ad guy who doesn’t get social media… but I have used social media to build a successful brand, the Ad Contrarian.
 
“So I’m not speaking as a social media denier. It is a huge world wide phenomenon. But social media marketing has been anything but that.
 
One genius said, if you can harness social media you don't have to pay for advertising any more. Bullsh*t! Social media is rapidly becoming just one more channel for delivering traditional paid advertising, take a look at your facebook page, it’s swimming in traditional paid advertisements. Count the number of paid ads and compare that with the number of so called conversations about brands
 
The first crack in this fantasy came in 2010 when Pepsi cancelled all its superbowl advertising to great fanfare to embark on the Pepsi Refresh social media project… This project cost them tens of millions of dollars that got them 3.5 million facebook likes - and a 5% DECLINE in market share. They dropped from the second best selling softdrink in the USA to third place.
 
Hoffman said one of the most stunning reports on the ineffectiveness of social media marketing is from McKinsey, which concluded that email is nearly 40 times more effective than social media marketing in acquiring customers.
 
The “social media delusion” has been shaken by many examples of how tweets and likes do not translate into buys, according to Hoffman.
 
“The hundreds of millions of people on social media are interested in interacting with each other, not with ads or brands.”
 
While the experts were lecturing us about the success of online marketing they were also prophesying the death of broadcast advertising “That has not happened either,” he said.
 
Despite all the “bullsh*t of these so called experts” Hoffman says studies show that radio is almost three times as popular with consumers than the web and radio is substantially more effective at creating sales than online advertising. “In addition, radio has none of the harrowing fraud problems of the web.”
 
He concluded with a strong message to the radio industry:
 
“I think you guys are letting the online industry eat your lunch. The online industry and the trade press have created a narrative but, regardless of facts to the contrary, the narrative lives, and you’re letting it live.
 
“ Radio and tv have been way too timid in your reaction to the online ad industry… you’ve been letting them get away with murder... Educate the people in agencies about [the opportunities] in your industry. The truth and the facts are on your side."
 
 

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