Advertising is failing because it is a ‘lawless game of chance’ says market research boss

Advertising is a “lawless game of chance” according to the CEO of market research firm Forethought.

Speaking at Mumbrella’s Marketing Science Ideas Xchange, Ken Roberts, CEO of Forethought, said 99% of advertising failure is because marketers aren’t rationalising reasons to deliver an advertisement.

Ken Roberts at Mumbrella’s MSIX Conference.

“Why is so much advertising failing? The reason is because it’s just a lawless game of chance indiscernibly better than gut instinct,” Roberts said.

“I believe our focus should be empirical dissection of behaviour in both ways, rational and emotional, and then to develop a creative brief based on these drivers.”

The session discussed how marketing science could help creatives quantify the drivers of consumption.

Roberts said brands need to stop focusing on “made up” measures such as brand equity and “global norms” and test for “validated drivers.”

“You are interested in what the drivers of purchase behaviour are for your product in your category,” he said.

Ken Roberts: Advertising a “lawless game of chance”

“If you’re trying to influence sales, than that’s what you are setting about to influence, why do you need to measure some made up measure called brand equity? You are seeking to change people’s behaviour.”

Also in the session, Roberts said building associations with emotional events can be an effective way of communicating with an audience.

Giving the example of beer brand XXXX, Roberts explained the association with Queenslanders and the State of Origin links the brand with emotion.

“It’s not actually building emotion into XXXX it’s about building the association of XXXX into State of Origin,” he told the audience.

Roberts: “It’s not actually about building emotion into XXXX, it’s about building the association of XXXX into State of Origin”

However, Roberts said measuring emotions is most effective if marketers can understand implicit and discrete emotions such as love and pride.

“If you’re using physiological ways of measuring emotion you are wasting your time. If you are using facial coding – you’re semi-wasting your time,” he said.

Roberts said the best creative work comes when agencies are “constrained” by this process of analysing rational consumer behaviour.

“If the creative agency argues to you that you shouldn’t be constraining the creative guys that’s not right,” he said.

“The best creative comes when they are constrained, when they are having work through this process where they’re fenced.”

Simpler is (sometimes) better: Managing complexity in consumer goods.

Here’s how consumer-goods manufacturers can master complexity—and even turn it to their advantage.

With consumers’ product preferences diverging and retail formats proliferating, consumer-packaged-goods (CPG) companies have compelling reasons to constantly launch new SKUs. Fast-growing niche markets—such as health and wellness products, socially and environmentally responsible wares, and ethnic foods—represent enticing opportunities for CPG companies, as do new online and offline retail channels. Indeed, product innovation can help CPG companies win shelf space and capture growth, which is crucial at a time when many CPG categories are experiencing flat sales. But manufacturing more SKUs means having more complexity in the entire business system—and that’s not a trivial matter to CPG companies already under pressure to cut costs and to become ever more efficient. We estimate that complexity among food-and-beverage manufacturers, for example, is costing them as much as $50 billion in gross profit in the US market alone.

Many companies are painfully aware of the problem, and acknowledge the difficulty of keeping complexity under control. CPG executives from a range of companies—including Campbell Soup, Colgate-Palmolive, ConAgra Brands, and Hershey—have made public statements about their efforts to reduce complexity in their businesses. It’s a tricky undertaking, precisely because some level of complexity is necessary and advantageous. Traditional approaches to simplification—such as “cutting the tail,” or discontinuing the lowest-volume SKUs—are suboptimal, both because they tend to address only one aspect of the business system (a cut-the-tail program is all about assortment) and because they can produce unintended consequences. For example, by discontinuing a low-volume SKU, a manufacturer might inadvertently eliminate a product that plays a unique strategic role in the assortment. Or it might unknowingly drive up the per-unit cost of manufacturing other SKUs made on the same production line.

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