I sincerely hope Sir Martin Sorrell ( CEO, WPP plc) was misquoted in the interview he gave during his recent visit to India . He said – “We know that consumers spend 20 per cent of their time online. We know that advertising on Internet and search is 7-9 per cent of worldwide advertising budgets. So, there is a disconnect here since, naturally, it should gravitate towards 20 per cent”.This argument just doesn’t stack up .
It has been clarified ( by one of the comments) that he wasn’t misquoted and he was referring to 20% of media-consumption time ( and not total time of the day) . Even then I am not sure that “If your target group is spending 20% of their media consumption time online , then online/digital should be 20% of your media spend” is an effective thumb-rule .
1. Propensity to consume /accept advertising messaging is different across medias. Let us illustrate via a simple example . If the balance 80% of time is spent between TV , radio , outdoor in the ratio 50/15/15 , one can argue that the likelihood of radio and outdoor messaging being received “effectively” by the consumer is perhaps higher . Think about it ,How often do you change the radio station while driving when an ad comes , How often do you find yourself reading the outdoor posters in a tube station while waiting for the train. Contrast that with channel surfing on TV and the focused nature of Internet surfing . Thus one might have a higher % on radio and outdoor in media mix because their effective reach is higher . To be fair, it can be argued that the challenge for the marketeers then is to weave their online message in such a way that it is registered or welcomed (i.e maximise effective reach).
2. Media mix varies according to the communication objective and consumer behavior in the category . Brand building messaging will require audio-visual content ( TV , digital) while brand awareness / reinforcement can be done with a healthy mix of outdoor and print . Secondly , impulse purchase categories require a different media mix from categories which have a more considered or loyal purchasing behavior.
3. Cost to deliver 1000 impressions (CPM) is different across media . Thus % spend on a particular media will not be same as % of time spent on that media ( those who want to understand this in detail can write to me seperately) . Further as one moves money away from “old” media to online , the CPM of the old media may go up because the benefits of bulk deals may reduce .
In summary , there are several other factors like consumer behavior, CPM of each media ,communication objective which will determine the media mix and hence % spent on each media.
There is no arguing with the fact that digital/online is a big opportunity which needs to be better understood . But so is In-store ( at least for consumer goods) .138mn shoppers visit a WALMART store during a week in US . This is much more than any single website .
The point is, any shift of media $$ to online should be a considered and case by case decision , and not driven by broad thumb rules. While advertising /communication networks hedge their bets by buying digital agencies, in-store marketing outfits etc as they see clients gravitating towards these touch-points , they should supplement it with real thought leadership to help clients navigate the complex media landscape as opposed to pushing “fads”