Knowledge Bridge

//Shubha Bala /July 4 / 2012

Advertising lessons from Facebook: Sell relationships not impressions

According to AdAge Digital, the social networking age brings with it an entirely new, superior, way of brand advertising.  Ben Elowitz, CEO of next-generation media company Wetpaint, says: “The key is in a single idea, and Facebook is singularly able to deliver on it: SELL RELATIONSHIPS, NOT IMPRESSIONS.”  With print, radio, TV and even online, advertising assumed a captive audience that was briefly interrupted to reach the “mostly-right audience at the mostly right-time” with an advertisement.  Be regular and creative enough, and people will probably hear your message – that was the logic.  Social networking offers a new opportunity, Elowitz believes, by giving brands an opportunity they never had before: To actually create consumer relationships before making purchases. He says:

A relationship is worth a hundred or a thousand times an impression – or more – depending on how you monetize it.

As Syed Karim, Media Development Loan Fund Director of Innovation and Digital Strategies, said in the last Digital Briefing, news and media organisations are “relationship engines”, and it is critical to manage the “relationship between the audience that they have created and advertisers who want to access that audience” now that it is possible to do so without relying on just having an interrupting ad here or there across a newspaper page.

Newspapers and other news outlets have traditionally been one of the best ways to reach an audience because they attract large numbers of readers, listeners and viewers. But digital media offer advertisers new ways to reach audiences and many news organisations are lagging behind their audiences in making the transition. This disconnection means many news groups have squandered the advantage they once had in the relationship with their audiences, and in doing so have lost a key selling point to advertisers: those relationships.

But how to monetize a relationship?  Ben Elowitz gives five steps:

• “Create an offering that can’t be price-shopped or commoditized.” Create truly original ad products.
• “Create an offering that can’t be measured in one-time conversions.” Allow brand advertising, not just click-throughs.  Right now only 40% of ad spending online is allocated to brand advertising, compared to 90% in offline markets.
• “Create an offering that enhances rather than compromises the user experience.” Keep the user-experience first.
• “Create an offering that closely guards the data.”
• “Create a supernetwork that has no borders.”

As news media organizations start assessing how they can get a bigger chunk of online advertising revenue, they should consider the relationships they have with their audience and discover ways to capitalize on that, rather than just focusing on impressions and click throughs.

Article by Shubha Bala