F**k paid media.

Just got out of the morning session of AdAge Digital Conference where Union Square Ventures’ Fred Wilson discussed the idea that it’s time we start investing in “earned media” in addition to the good ole fashioned paid variety. Then he shared this point of comparison:

Two ad spots during the Superbowl cost roughly $4MM plus another $1MM to produce the ad. That means an advertiser is spending $5M to get roughly 10MM people exposed (but not engaged), for 30 to 60 seconds.

CareerBuilder’s Monk-e-Mail campaign cost $250k in creative and execution fees (earned media, not paid) and got 30MM users to actually interactfor an average of 8 minutes each.

Whip out your calculator and you’ll quickly see that the pure cost per impression for the paid media campaign is $.50—versus $.000833 for the earned media campaign. And that’s not even factoring in the length of time they spent on the site or the viral/network effect downstream.

Is it me or is the shift to earned media A TOTAL NO BRAINER?

The only thing I don’t understand is why a smart guy like Fred would pussyfoot around the issue and say “in addition to” not “instead of”.

Throw down the gauntlet, Fred! Stir the pot! PUH-LEASE!!!!!!!!!!!!

(Also, thank you for giving me a lovely excuse to drop an f-bomb. And for sharing that story about the Jonas Brothers. Much obliged.)

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6 Responses

  1. I totally agree! So many corporates are scared to use Social Media and online campaigns, but will still invest millions in TV, print and radio when there clearly can’t measure the effect of them properly.

    They rather spend a measly 5% of their advertising budget on online / mobile when the ROI and interaction far outweigh anything they have ever put up on traditional media channels.

  2. FYI I’m a digital strategist, working with big national brands.

    And this kind of sensationalist talk just degrades your credibilty. Paid media does work and works well with lots of non-paid media. It’s not one vs the other.

    In regards to your calculation, the only missing multiplier is the number of times you’d need to have to create that content before you got that kind of reach. I haven’t seen mny agencies or brands do it consistently over time. It’s so hit and miss. The tv version of why your talking about would be like a brand creating a tv show, music video or some such thing.

    So the more we ‘digital’ marketers have sensationalist rants the greater the diode will be between digital and dollars.

  3. While i am also an advocate of producing “earned” media you have in my opinion neglected the exposure (or earned media) all good SuperBowl spots get for weeks after they have aired. I am sure that would raise their part of the value in your calculation.

  4. Ah, how I love a good debate! Thanks for sharing your views, stirring the pot, and weighing in on what I suspect will continue to be a thorny subject for many in our industry.

    And just to stir the pot a little more… I think part of the reason the earned-approach work we’ve seen so far has been so “hit or miss” is b/c most of the folks creating that content are approaching it with the Old Model mindset wherein the media buy = 95% of the budget and effectively PAYS for a lack of creativity, inventiveness, etc. I heard this very belief voiced by Unilever’s CMO, Simon Clift, at the AdAge Digital conference yesterday: “Sometimes large budgets can make us lazy .When u have little money to spend on media, you’re forced to be more creative.”

    Bring it on, I say!

  5. I agree! BRING IT ON!

  6. I agreed with Marta on:
    – Social media is cheaper as against the Traditional advertising.
    – Viral marketing has wider reach .
    But the probable reason for why one is ready spent $ 5M could be:
    – Higher Brand Recall value as the audience is more attentive during the sports events.
    – Lower Noise Factor ( when team supported by target viewer is in wining condition, it can also goes otherwise)
    – During this time(sports events) creative advertise can create more buzz (or WOM) as against Normal days
    (e.g. Vodafone creative advt. zoozoo which is currently aired in India has created more impact during ongoing IPL events)

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